Growing Chilean produce market offers retail opportunities

11/11/2011 12:07:00 PM
Jim Offner

Opportunity abounds at retail during the Chilean produce season, marketers say. All one has to do is look at some numbers, they say.

“They’ve gone from zero to over 2 million oranges in just a couple of years, so I’d say they’re successful,” said Peter Kopke, president of Lake Success, N.Y.-based William H. Kopke Jr. Inc.

“We used to be alone with the South Africans, along with Australia. Now there’s Chile, and the addition of Chile has not meant a decline of the market.”

Marketing programs will aid retailers looking to promote Chilean items, said Tom Tjerandsen, managing director for North America with the Sonoma, Calif.-based Chilean Fresh Fruit Association.

“There’s an index of consumption for the various markets around the country,” he said, pointing out that comparing sales to a particular population will reveal weak areas that can be strengthened.

“We developed for different product categories a series of best practices, and we have a bunch of merchandisers who carry that information into those retailers and say, ‘You leave a lot of dollars on the table — here’s what’s happening and why and what you can do about it,’” Tjerandsen said.

A year-round berry patch concept, such as that used by Watsonville, Calif.-based Driscoll Strawberry Associates Inc., also is key strategy, Tjerandsen said.

Marketers sometimes take advantage of their peak season by focusing promotions on big seasonal events, such as avocado promotions and football.

“Our central theme of football is very popular,” said Maggie Bezart, marketing director with the Aptos, Calif.-based Chilean Avocado Importers Association. “We’re currently at budget with all of our retail promotions and are looking to actually add more.”

The association has billboard and radio advertisements and a retail display contest that has new features this year, Bezart said.

“Our display contest has a new element that the retailers are really supporting, and that’s a new ‘scratcher’ program,” she said.

Every produce manager that enters the display contest with a photo gets an opportunity to win cash prizes, she said.

“The produce manager will go online with their number and virtually scratch off this promotional tool, and what they will win is between $25 and $500. They also enter into own display contest, where they can win up to $1,000,” she said.

The contest, which runs through February, has $120,000 in prizes.

An Avocado Lovers contest has $45,000 in prizes.

The association also has a joint-promotional effort with Tostitos that is tied in with college football’s Fiesta Bowl, Bezart said.

“It’s a tie-in where we are the only avocado sponsor of the Fiesta Bowl,” she said.

“That ties in with consumer programs, with the Avocado Lover’s Club giveaway during the game, P.R., advertising that is done with joint promotions with Tostitos and the Fiesta Bowl. And our in-store promotion, which is a coupon giveaway with a dollar off Tostitos chips with the purchase of two Chilean avocados. There are bins in produce departments and signage on all the bagged avocado racks.”

Retail promotions are aggressive, said Dan Carpella Jr., director of sales and marketing with Pittsgrove, N.J.-based Nathel International.

“Absolutely, and recently it’s gotten better,” he said. “They’re going more toward what the crop of the year is doing and not just putting an ad for the same item from the same period in years past.”

Retailers are eager to promote on price, said Eric Crawford, president of Weston, Fla.-based berry shipper Fresh Results LLC.

“I think it’s going to be very interesting to see what happens,” he said. “The retailers are looking for more aggressive pricing because, obviously, our economic situation is in the ditch.”

For Naples, Fla.-based Naturipe Farms LLC, bigger packs at retail mean better value for shoppers, said Brian Bocock, vice president of sales.

“As the industry has increased in volumes, they offer bigger packs, which helps provide a value proposition to the consumer,” he said. “We have to provide that. Bigger packs allow us to operate in that environment maybe better than two, three or four years ago.”

The retail promotional focus is divided into three areas, said Josh Leichter, Newark, Del.-based vice president of the East Coast and grape category director with the Vancouver, British Columbia-based Oppenheimer Group.

“One is the retail price point,” he said. “It’s important to work on aggressive margins to drive that volume.

“Consumers are used to seeing a lot of 99-cent, $1.29-per-pound ads out of California. Look at aggressive retail pricing and working on maybe a reduced margin that week is important.”

A second factor is “large, well-merchandised displays that are refreshed every day and featured prominently in the stores,” he said.

Quality is the third important consideration, Leichter said.

“Consumers are attracted to the quality and the eye appeal of the grapes, and if you’re focused on having good-quality grapes in the stores, that’s going to drive sales,” he said.



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