HERO Entertainment Marketing is in its seventeenth year of operation. A product placement agency cannot possible be in business for more than fifteen minutes before the Reese’s Pieces placement in ET comes up in conversation.  People wonder how it happened, how much it cost the brand and, for the real insiders, did M&Ms really pass up the placement before Reese’s got it?  The answers are: M&M passed, not a dime and yes!  M&Ms were, in fact, offered the placement first and passed on it, there was no fee attached to the inclusion (though a promotion was later negotiated) and sales went nuts!

Snopes did a great investigation and, while there were only so many behind the scenes machinations they could trace, the bigger facts were revealed.  Here’s some of what the fact checking site reported:

During production of E.T., Amblin Productions approached Mars, Inc. about a possible tie-in between M&Ms and the film. For whatever reason, Mars said “No” to the proposition. Many purported reasons for that negative response have been provided by a variety of sources: Mars decided it didn’t want its bite-size candy associated with an extraterrestrial living with an earth family, or it thought the film’s premise just a bit too otherworldly, or an unnamed M&M executive decided nobody would want to see a movie about an alien adopted by a lonely kid…

Hershey did not pay to have Reese’s Pieces used in E.T., but it did agree to do a tie-in between the movie and the candy after the film was released. A deal was inked wherein Hershey Foods agreed to promote E.T. with $1 million of advertising; in return, Hershey could use E.T. in its own ads. 

Needless to say, sales went through the roof (without needing a flying bicycle). Increases of up to 85% were reported at the time.

Snopes did include an interesting addendum to the story; though ET was not based on a book, it was novelized after the success of the film.  In the book, penned by respected Sc-Fi writer William Kotzwinkle, M&Ms returned and replaced the candy that replaced them!