High on the hog: How Percy Pig came to dominate the sweetie market, and win the nation's hearts

Last month, as outgoing CEO Stuart Rose told the press that "the worst effects of the recession [were] behind us", it was hard to imagine that there was a time not so long ago when the only thing keeping Marks & Spencer afloat was knickers. In the troubled years – roughly from the mid-1970s to the late 1990s – before it was reborn as the foodie destination for the busy office classes, the public perception of the high-street giant was that it was stodgy, out of touch and good for little more than clothing senior citizens and supplying reliable, value-for-money, unsexy underwear.

It's impossible to say exactly when or how that changed. Think M&S then and you might conjure up images of boil-in-the-bag meals and comfy slippers. Think M&S now and you may well be lucky enough to picture the bikini-clad Brazilian model Ana Beatriz Barros, an equally exotic array of orchids, melt-in-the-middle chocolate sponge puddings and the wholesome, reassuring face of Percy Pig.

Marks & Spencer has never been known for creating iconic brands or following fleeting fads (this is a store, remember, that chose not to accept credit cards until 2001); a sense of history and the bigger picture has always been part of its retail DNA. But somehow, in spite of the fact that he spent years sharing shelf space by the tills with such un-family-friendly products as bars of Swiss Extra Fine Dark Chocolate, Percy Pig – a jelly-and-foam confection flavoured with fruit juice – has emerged as something of a cult classic.

Loved by fashionistas (he made it into Vogue's "Hot List" in 2008), marathon runners, children, their mothers and anyone who ever needed sugary (but fat-free) help to make it through the office day, two Percy Pigs are now scoffed every second in the UK. And this in spite of no advertising, no mission statement and no snappy slogans. He brings home the bacon, too: more than 10 million bags are sold in the UK every year at a little over £1 a bag; you do the maths.

A Facebook appreciation group for Percy has, at the time of writing, more than 234,000 admirers. Lewis Hamilton told the M&S magazine that this was the one product he couldn't live without. Calvin Harris admitted to another magazine that he used to steal them before he became a famous pop star/DJ. A blog written by an ambulance controller tells of the time a crew was sent out to get some Percys only for a man to go into cardiac arrest nearby. "Fortunately," the controller writes in an entry entitled "The Percy Pig Incident", "G602's pig run had put them in just the right place... If the patient lives, it'll be entirely down to those Percy Pigs."

Quite how far these middle-class Haribos had entered the vernacular became apparent standing in a snaking queue at the end of a working day in a busy M&S Food to Go. As stressed Londoners inched towards the pay points desperate to avoid eye contact, one businessman at the till turned around and said loudly to a fellow suit: "Sorry mate, sorry, can you pass the Percy Pigs." Blank stares. "Er, the Percy Pigs. Yeah, the Percy Pigs. Can you pass the Percy Pigs." As Queue Man tried to outstare his feet, it became apparent that Till Man would not leave without his fruity booty. Pigs reluctantly passed, we could all move on.

A few days later, a colleague came back to the office in a state of excitement with a packet bearing the legend "Reversy Percy", a sweet consisting entirely of the sticky jelly part that makes up the regular Percy's ears. There was something going on behind the scenes here: the company controlling Percy's destiny was, unusually for a corporate giant the size of M&S, in on the joke and laughing with us.

Behind Paddington station there is a glass-fronted office building with swanky lifts running up the outside that is the global headquarters of M&S. Inside, some 2,500 people are spread out over 10 floors working on those aspects of running a company this size that most people rarely think about: finance, IT, marketing, shipping, buying, sourcing, distribution, etc.

Around the perimeter of the first floor are the rooms put aside for product testing. Here, the many goods that will fill the shelves of the M&S stores of the future come to be prodded, pulled, worn, used and tasted. Today, pre-filled plastic wine glasses with a foil-top closure are being raised at a party to celebrate their imminent launch. '

In a boardroom around the corner stands a person (it's impossible to say whether male or female) in a Percy Pig costume. This "real" Percy Pig has attended the London Marathon and London Fashion Week, but M&S executives are keen not to overexpose the costume, which is already getting a little scruffy around the edges. Members of staff pop their heads through the door keen for their opportunity to be photographed with the pig. Talk of the person sweltering inside the costume is forbidden. This is Percy Pig and that's all there is to it. OK, he might not be able to move much beyond a wave. True, he can hardly sit down. And yes, he comes close to toppling over as the photographer requires him to act out various scenarios for the camera.

On the boardroom table are packets of Percy Pig, Percy Piglets, Percy Pig and Pals, Reversy Percy, Phizzy Pig Tails and a new range of face-only biscuits that will debut in stores any minute now. The full-size Percy surveys his kingdom. A group of M&S women, who look exactly as you would imagine them to: wholesome, healthy, happy – somewhere between Bridget Jones and harried mum in age – float around checking that the Percy character is not compromised by today's photo session.

One of the women, Lucy Clark (product developer, confectionery), takes a moment away from the mêlée to talk about her part in the Percy Pig story. "A lot of people think he's an overnight success, but it's actually taken 17 years to evolve," she says. The idea for a foamy sweet came, she explains, from a German manufacturer called Katjes, but it wasn't until the original product team led by Julia Catton came up with the Percy character that it could be manufactured in the kind of volume that would keep Katjes and Marks & Spencer happy.

Catton, who has since left M&S but remains in the sweets industry, remembers that time well. "It was the mid-1990s, we'd already made a few yoghurt gum and licorice products with Katjes but nothing had really worked in the UK, so a team of us went out to Germany to thrash around some ideas. We sat around a table and drew a blank. Eventually, the Katjes people said, 'We'll leave you here for an hour and see if you can come up with anything.' I looked up and saw a licorice panda sweet with different coloured ears. Next thing I knew, I had drawn Percy Pig on a piece of paper."

Its level of success has taken many people by surprise. "You could argue it's not a traditionally British sweet," says Clark. "The British have a long history of sweets like wine gums, and I think the taste of Percy Pig is more continental. We pioneered the use of natural colours and flavours, and they taste better because of it. People also notice that they are fresher than most chewy sweets and there's a perception that they are healthier because of the fruit juice. All of that gives people the excuse they need to eat them."

To keep the public pigging out (market research shows most of us go in ears first), eight people – Clark, a buyer, a technologist and merchandisers – meet up each week to talk about where the pig might go from here. "There's a relaxed feel to the way Percy is developed as a brand and a genuine sense of doing what's right for the pig," says Clark.

Reversy Percy, perhaps living up to his name, came about a little differently. These gummy sweets, made using the Percy mould, were bought to the table by Katjes, and the original feeling was that they weren't quite what M&S was looking for. "They stuck together and looked wrong," Clark recalls. "I remember thinking, 'If I can come up with a name, we might have a product.' That night, I thought of Reversy Percy, and from that moment it was all systems go to get it out there."

Others have fared less well. Penny Pig (citrus foam with lemon and orange jelly ears) was released in 1998 but lasted only a few years. Her sporadic reappearances in "limited-edition" form have not stopped people from asking how, if Penny no longer exists, Percy Piglets ever came into being. A case of immaculate confection, perhaps?

It's unlikely any of the team's developments will ever overtake the sales of their illustrious predecessor, but for now the Reversy Percy name alone has bought M&S a fresh wave of public affection. "The original Percy has been around a long time now, and there's a nostalgia attached to that because a generation of people have grown up with him," says Clark. "When we did some research in 2007, people told us there was an honesty about Percy." People also told researchers that Percy "can be cheeky at times" and this sort of anthropomorphizing is key to the pig's success and seems to afflict everyone who comes into contact with him.

Back in the boardroom, the photo session is winding down when someone suggests that, to show the cute tail on the back of the costume, it might be a good idea to run off a few shots from behind. Again, this doesn't prove easy. When the person inside turns their head to glance backwards, Percy stays resolutely facing the front. Eventually, one person holds the costume's body while another two turn its head around. The person inside can see nothing, but the pose looks right and the photographer gets his shot. In other costumes of this type – the mascots and money-raisers you see at fêtes, fundraisers and festivals – the impossibility of the character to look backwards might present many such unforseen problems. In the case of Percy Pig, it seems entirely appropriate.