Doubleminting Money Creative and pervasive marketing built the Chicago gum giant.
By Paul Lukas

(FORTUNE Small Business) – The recent news that the Wm. Wrigley Jr. Co. had purchased several Spanish confectionery brands for $272 million was a testament to how far Wrigley has come from its origins--when its first two products weren't even edible and chewing gum was an afterthought the company gave away free.

The Wrigley story dates to 1891, when 29-year-old William Wrigley Jr. arrived in Chicago and began selling soap. He was so tenacious that, as he later described it, one merchant "admitted he would either have to give me an order or kill me, and he didn't want to kill me." To sweeten his deals Wrigley began offering free sales premiums--first umbrellas, then baking soda, and the latter quickly became more popular than the soap. So Wrigley entered the baking soda business, again offering a premium: chewing gum. Once more, the freebie generated greater excitement than the main product, and Wrigley adapted accordingly. In 1892 he began focusing exclusively on gum, and in 1893 he introduced his signature brands, Wrigley's Spearmint and Juicy Fruit.

Midwestern sales were solid, but Wrigley wanted to go national, which he knew would require advertising. He began with a pair of $100,000 campaigns in New York City, but both fell flat--he simply didn't have the capital to penetrate such a big market. His unlikely break came with the panic of 1907, which severely depressed ad rates. Sensing an opportunity, Wrigley borrowed $250,000 and mounted a campaign that would normally have cost $1.5 million. It worked: Within three years the company grew from a $170,000-a-year regional upstart into a national powerhouse with $3 million in annual sales.

Subsequent campaigns confirmed Wrigley's knack for innovative salesmanship. He essentially invented direct marketing in 1915, when he mailed complimentary gum to the 1.5 million U.S. homes listed in telephone directories, figuring that anyone who could afford a phone could also afford his product. The stunt worked, so he repeated it in 1919--the same year the company went public--this time to seven million households. And in 1930, Wrigley began promoting its Doublemint brand with the now famous Doublemint twins.

Throughout this period Wrigley maintained a steady ad blitz. In 1920, when American Magazine asked Wrigley for his secret to successful advertising, he responded, "Tell 'em quick and tell 'em often." By the time of his death in 1932, his gum company was America's largest single-product advertiser, and profits topped $12 million--all the more impressive considering the company's product line sold for only 5 cents a pack (a price that held, incredibly, until 1971). When William's son, Philip K. Wrigley, took over for his father, the company continued its strong ad presence, even during World War II, when materials shortages made it impossible to produce Wrigley's core brands. The firm ran billboards depicting an empty pack of Wrigley's Spearmint and the line "Remember this wrapper!" When production resumed in 1946, sales exceeded prewar levels.

Today another William Wrigley, the founder's 40-year-old great-grandson, is at the helm, and the firm's ad tradition continues. A clever 1990s campaign capitalized on changing social habits by promoting gum as an alternative to smoking, and Venus and Serena Williams have become an updated version of the Doublemint twins. So while other members of Chicago's once proud confectionery empire are struggling (the Archibald Candy Co. just announced the closing of its Fannie May and Fanny Farmer stores and its manufacturing plant), Wrigley's global sales are now up to $2.75 billion. Pretty good for a company whose flagship product still retails for only 30 cents--not quite a freebie anymore, but close.