Ferrero opens downtown innovation lab, marking a return of chocolate-making to Marshall Field building

For nearly 70 years, workers minted Frango chocolates on the 13th floor of the Marshall Field & Co. building on State Street.

Frango production moved out of state in 1999 to the dismay of civic leaders and local mint chocolate aficionados. The Frangos are long gone, but more than two decades later, chocolate has made its return to the upper floors of the building now anchored by the Macy’s department store, where candy giant Ferrero is opening its first North American research and development lab and innovation center.

The Tribune visited Ferrero’s labs, located on the building’s ninth floor, prior to a grand opening planned for Tuesday. Here, research teams will develop new product recipes, though sweets will not be manufactured on-site.

Details of the new operation are closely guarded. The Tribune was allowed to enter the labs where food scientists will research the development of new cookie products, but not its chocolate labs or the innovation center, where a team will conduct long-term research in support of products that could hit shelves a decade from now. Nor was the Tribune permitted to view the “sensorial” or “analytical” facilities, where workers will participate in blind taste tests of new products and evaluate their properties down to the gram.

The new space will support Ferrero’s scientific approach to the experience of eating — and selling — sweets.

“You need brains and you need machines,” said Laurent Cremona, senior vice president of research and development in North America and innovation center head.

When the Tribune observed Frango production at Marshall Field’s in 1976, it viewed an assembly line in “full, tumultuous gear” stamping out “endless rows of creamy, mint-scented chocolates at a rate of up to 300 pounds an hour.” A conveyor belt vibrated excess chocolate to ensure each chocolate was uniform in weight; upon the mints’ emergence from a drying tunnel, workers inserted them into paper liners and then into boxes.

“It is slow, exacting work, a vanishing art from another era,” the Tribune wrote.

This century, the sweets labs at the historic Marshall Field building are an expansive white space full of shiny ovens, refrigerators and mixers used for testing but not production.

Ferrero’s local production is spread out across several facilities. In Illinois, Butterfinger and Baby Ruth chocolate bars are manufactured in Franklin Park and Keebler brand products are produced in a plant on 110th Street in Pullman. Ferrero makes Crunch bars, 100 Grand and Raisinets products at a facility in downstate Bloomington, where a $214.4 million expansion that will allow the production of Kinder products in North America for the first time is on track for completion next year.

Based in Luxembourg, the candy-maker has expanded in recent years, acquiring Chicago-based Ferrara Candy, the maker of Lemonheads, and chocolatier Fannie May. In 2018 and 2019 it bought Nestle’s U.S. candy business and a portion of Kellogg’s North American snacks business, acquisitions that added the Butterfinger, Nerds and Famous Amos brands to its portfolio. Close to 500 Ferrara employees continue to work from the Old Post Office, confirmed spokesperson Blair Klein.

The Chicago labs will be a hub for development of North American products.

It isn’t easy “to capture all the needs, all the trends, when you are in (another) continent,” said Joao Paulo Andorinha, senior vice president and head of the research and development lab.

“It’s why it’s important to be here,” Andorinha said.

Legacy products like Nutella and Ferrero Rocher chocolates are made with the same recipe the world over, Andorinha said.

“After that we have some more, I will say, specific products, like all the Keebler ones, Famous Amos, where there was designing for (the) North American market: in terms of the sweetener, in terms of the texture,” he said.

One U.S.-specific brand that will be studied at the new R&D facility is Girl Scout cookies, acquired as part of Ferrero’s Kellogg purchase. Andorinha said the company sees the brand as a way to introduce younger consumers to Ferrero products.

About 30 to 40 workers will staff the labs and innovation center, with Ferrero’s total head count in the building topping 150 employees. Office staff on the eighth floor include brand teams for banners such as Keebler and Fannie May, as well as other corporate employees working in areas including finance and procurement.

The company is not adding to its head count in order to run the facility.

Ferrero said it has more than 1,500 employees in the state, including at its manufacturing facilities, downtown offices and Fannie May retail locations.

In a statement, Chicago Mayor Brandon Johnson praised the investment at the Marshall Field building as one that would cement Chicago’s reputation “as a prime destination for the world’s best talent and businesses.”

The upper floors of the Marshall Field building, which occupies an entire Loop block, were purchased by developer Brookfield Asset Management from Macy’s in 2018. Brookfield then converted those floors, which include the former Frango production space, into offices. Companies with leases in the building include online ticket broker Vivid Seats and Chicago-based market research firm Numerator.

Brookfield has leased 133,000 square feet of office space in the building so far this year, said spokesperson Laura Montross. New tenants include agribusiness company Olam International and logistics company Spot.

Privately held Ferrero reveals little about its finances, but said its U.S. sales grew more than 12% over the last year.

In an interview, Ferrero North America President and chief business officer Alanna Cotton said consumers are looking for products that are “extra sensorial.”

Cotton declined to describe potential future creations in detail, but said the company will continue to experiment with products that have “a bit of texture, crunch, but also the goodness of chocolate, the goodness of fudge.”

“You can think about the idea of really combining our know-how in the chocolate, combining what we’re learning on the bakery side, and really making sure that we can create that experience that consumers love,” she said.

Products that can be consumed on-the-go are also in demand post-pandemic, Cotton said, citing Ferrero’s Nutella & Go offering as one example.

Ferrero declined to share what percentage of its business is comprised of U.S. sales.