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As chocolate sales slump, candy bar marketers are sweetening their on-pack promotions.

And as the number of on-pack and point-of-purchase offers from package-goods and cigarette marketers mushrooms, creativity has become the No. 1 weapon in on-pack candy offers.

On-pack chocolate bar offers have been solidly effective and represent one of the candy industry's oldest and lowest-cost promotional tools. Most are created with the help of outside promotion agencies on a project basis; few are supported by general advertising.

"The candy industry is very fragmented," said Ed McAdams, president of McAdams Associates, Chicago, which has worked with M&M/Mars and E.J. Brach Corp. "People might have 10 bars they eat frequently, not one brand day in and day out. The candy companies are trying to get people to buy a little more of their brand and keep them from switching to another."

Hershey Chocolate USA's Bar None is trying to tempt teens with its on-pack promotion for "The Coolest Stuff"-everything from basketballs to boxer shorts-which it's giving away with the mail-in of 10 or more wrappers.

M&M/Mars is countering with a $9.95 on-pack offer for a multicolored quartz watch sporting a skateboarding M&M's peanut character on the second hand.

Few products lend themselves to on-pack offers as well as M&M's with its plain and peanut characters.

"The characters have a universal appeal" and allow M&M/Mars "to extend our brand presence," said Jim Conlan, external affairs director.

Entertainment is a strong theme in other on-pack chocolate bar offers, which dangle free CD players, trips to Universal Studios and free movie passes.

Aiming for frequency of purchases, Hershey's 5th Avenue bar is giving 250 people the chance to instantly win a Sharp portable six-CD player with AM-FM stereo by finding a wrapper that says, "It'll make you go crunch." Another 250 can win the same prize if they collect enough wrappers to spell out the entire phrase.

Nestle Chocolate & Confections is offering a Universal Studios T-shirt for $9.95 plus two proofs-of-purchase from Nestle Crunch bars etched with Universal Studios ride designs. The T-shirt features scenes from blockbuster movies/Universal Studios rides "Back to the Future," "Jaws" and "King Kong."

Consumers who buy Leaf, North America's Heath English toffee bar can instantly win movie tickets and other prizes. Those who collect three wrappers can get a movie poster from such flicks as "Gone With the Wind" and "Malcolm X."

Kit Kat is offering 50,000 prizes in a "Gimme a Break in Hollywood" instant-win game, including a walk-on part on TV's "Full House." Those who collect 10 wrappers can get an autographed cast photo. Advertising will support.

Candy marketers are also extremely keen on in-store support of larger on-pack offers.

"The candy company might say to the retailer, `If you put in a big display, we'll give you this watch. You can show it to your customers,'*" Mr. McAdams said. "But most bring it home to their kid."

The barrage of promotions continues even as most major brands suffer from slipping sales.

Hershey's Bar None was down 34% for the 52 weeks ended June 19, according to Information Resources Inc. M&M's chocolate candies (less than 3.5 ounces) were down 4%; 5th Avenue, down 21%; Nestle Crunch, down 9%; and Heath, down 6%. Kit Kat was up 3%.

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