Photo from Produce Business

The months from the Super Bowl to Cinco de Mayo were once the peak selling season for avocados when California was the main supplier to the U.S. market. Now, it is nearly two decades after the U.S. Department of Agriculture lifted its ban on Mexican fruit. It is almost 10 years since south-of-the-border avocados got the green light for shipment into all U.S. states. With these capabilities in place, the fall season is poised to become a prime time for retailers to see more “green” from avocado sales.

“We offer an unusually large amount of shelf space for avocados in produce in the fall,” says Richard Stiles, director of produce and floral for Redner’s Markets, a Reading, PA-based chain throughout Pennsylvania, Maryland and Delaware. “We also set up additional displays next to the chips and soda; plus, we keep the fruit at an attractive, everyday low price. Avocados, used especially for guacamole, have become synonymous with the fall’s football season, tailgating and snacking occassions. Halloween has also become such a party holiday that avocados sell well then too.”

The fall is an especially ripe time for the growth of avocado sales. This is because of a significant opportunity gap. While avocados represented 2.7 percent of total produce sales in the 52 weeks ending July 2, 2016, Q4 of 2015 represented the lowest annual percentage at only 2.4 percent, according to data provided by the Chicago-headquartered Nielsen Perishables Group. The two keys to achieving these stats are availability and season-specific merchandising and promotion.

Forecast: Plentiful

The start of fall signals a transition of growing areas for avocados in the U.S. market. “The California and Peruvian seasons come to an end between August and September,” says Giovanni Cavaletto, vice president of operations for Index Fresh, Inc., in Bloomington, CA. “Mexico supplies about 60 percent of the market in September, and this moves to more than 80 to 85 percent by October with the remainder from Chile.”

Rob Wedin, vice president of fresh sales and fresh marketing for Calavo Growers, Inc., in Santa Paula, CA, agrees “Mexico will be the primary supplier in the fall.”

Supply from Mexico will be excellent to cover fall promotions.

“Current projections show 35 to 45 million pounds per week,” says Maggie Bezart Hall, vice president of trade and promotions for the Dallas-headquartered Avocados from Mexico (AFM).

“More specifically, sizes will start small as the ‘first bloom’ or ‘flor loca’ crop is harvested in September,” says Paul Weismann, president of Healthy Avocado, Inc., in Berkeley, CA. “The majority of this fruit will be 60s and 70s, which is not the size consumers prefer. As we move into October, ‘the second bloom,’ or ‘venturera crop,’ will produce a better range of sizes with more 40s and 48s and a higher oil content for healthy eating.”

Chile starts harvesting its fruit in August and will continue to have fruit in the market through March of 2017. However, the U.S. has become a smaller market for this South American country. According to Karen Brux, marketing director for the San Carlos, CA-based Chilean Avocado Importers Association (CAIA), of the 180,000 metric tons harvested in 2015, half stayed in country, and the rest shipped to Europe with only 11,000 metric tons (24 million pounds) arriving in the U.S. for a few key retail accounts. This season, Chile’s total harvest volume is expected to grow to 200,000 metric tons as areas previously affected by drought will return after this past year’s rainfall.

“In terms of volume shipped to the U.S. market, we expect it to be similar to 2015/16. If market conditions are supportive, there could potentially be opportunities to expand our U.S. program. We will continue to work with a few key retail chains and develop targeted marketing programs to support their sales of Chilean avocados,” says Brux.

Size is one key area of opportunity. “Since there will be more small-sizing out of Mexico, there’s an opportunity for Chile to get better prices in the U.S. this fall with its larger-sized fruit,” says Index Fresh’s Cavaletto.

Many retailers, especially on the East Coast with customers of Caribbean and Central American heritage, will stock green-skinned avocados.

“Florida avocados typically peak in July and August, but we have consistent supplies in the fall,” says Bill Brindle, vice president of sales and marketing for Brooks Tropicals Inc., in Homestead, FL.

Seasonal Promo Programs

Avocados are a year-round staple and perennial Top 5 seller at Northgate. “We don’t really sell by the calendar, because, for us, avocados are such a high penetration item,” says Cano. “However, we do like to take part in all the bells and whistles promotions offered by Avocados from Mexico, like sales and display contests, point-of-sale promotions and recipes. It’s a real added-value for our customers.”

Photo Courtesy of California Avocado Commission

AFM’s fall to early winter program this year is packed with exciting opportunities to market avocados. The first promotion of the season, ‘For the Love of Guac,’ starts this month. September presents a unique opportunity due to occasions such as Labor Day, Hispanic Heritage Month, National Guacamole Day and the start of football season. The promotion is accompanied by guacamole-centered pallet bins and Molcajete-styled bins that can display avocados as well as recognizable accent ingredients such as tomatoes, onions, limes and lemons.

“We are excited to present ‘For the Love of Guac’ for the first time. This is an extensive consumer program that will leverage all of these celebrations. Our goal is that this promotion becomes an annual tradition that our consumers will look forward to each year,” says Bezart Hall.

As part of its For the Love of Guac promotion, AFM will launch a National Catalina Coupon where shoppers can buy one Mexican-grown avocado and get a second fruit free or get $1.50 off on the next bagged avocado purchase. This will be followed by digital coupons on Coupons.com, a National FSI ad and in-store IRC.

“September also represents a unique opportunity to celebrate with our Hispanic consumer base given the Fiestas Patrias holiday, which takes place on Sept 16,” says Bezart Hall.

AFM’s Viva La Fiesta promotion, which runs from September 1 to October 15, will bundle the AFM and Tabasco brands to offer Hispanic shoppers family-oriented celebratory meal solutions. In-store tools will feature co-branded bins that offer products with a $1 savings offer valid on one Tabasco and two Mexican avocados. POS and digital/social components are a key part of this promotion.

In October, AFM will partner with Ro*Tel (the brand most recognized for its blend of canned tomatos with chilies) for its Tastiest Tailgate promotion that lasts until October 31. Now in its third year, the partnership celebrates fall football and is centered on the Rock n’ Guac guacamole recipe. Large and small co-branded bins feature the easy three-step recipe instructions.

CAIA also offers retail marketing support for its Chilean-grown avocados this fall. This includes merchandising materials that cover three themes (nutrition, taste and seasonal) with catchy supporting taglines such as, “The Game Changer,” “Taste that Tops Everything” and “Open Up and Say Ahhvocado.” There’s also a fully integrated social media program. Additionally, CAIA launched a new logo, moving from “Avocados from Chile” to “Chile Avocados.”

Beyond country-of-origin marketing initiatives, promoting avocados during the holidays has huge potential. In 2015, holidays and events represented 25.6 percent of total annual produce sales, according to HAB’s Holidays & Events 2015 report. Five of 13 holidays showed an increase in their percentage dollar contribution. Two of these were the Super Bowl and Cinco de Mayo, while two others were fall holidays: Labor Day and Halloween.

For Halloween, “guacamole in a pumpkin shell makes for a fun decoration and a traffic-stopping demo that also encourages pumpkin sales. Beautiful fall salads with avocado are perfect for Thanksgiving, and produce-rich chili and soup recipes topped with avocado work well for the season,” suggests the CAC’s DeLyser.

Six Fall-Centric Best Practices

Strategic selling points that boost avocado sales year-round also work well in the fall,especially if a fall-centric marketing angle is employed.

1) Ripeness. “The most important consideration for our customers is ripeness. They want to use the avocados that night or the next day; they don’t want to have to wait. That’s good for us, because they come back sooner to buy more,” says Richard Stiles, director of produce and floral for Reading, PA-based Redner’s Markets.

Anaheim, CA-based Northgate González Markets’ produce director Alfonso Cano says, “Ripeness is so crucial that we ripen the fruit ourselves. It’s riskier that way, but we’re in the business to sell avocados, and we play to win by having ripe fruit on display at all times.”

Ripeness is the key purchase driver for both heavy (purchase of 37-plus fruits annually) and light (1 to 36 annually) avocado buyers, according to the Mission Viejo, CA-headquartered Hass Avocado Board’s (HAB), Shopper Purchase Decisions & Influences – Driving Hass Avocado Sales at Retail, 2015 Path-to-Purchase Action Guide.

“After ripeness, it’s a combination of quality, pricing and selection that are the primary factors in the shopper’s decision to purchase avocados,” says Emiliano Escobedo, HAB’s executive director.

2) Two Sizes. “Size requirements vary by retailer, with some requesting at least two sizes to maximize sales potential. Offering a small size (usually 60s or smaller) and a large size (size 48s and larger) helps meet different consumer needs and give a sense of variety,” says Jan DeLyser, vice president of merchandising for the California Avocado Commission (CAC), in Irvine, CA.

Another option for a two-size program is to make the second or larger size a Florida avocado, suggests Bill Brindle, vice president of sales and marketing for Brooks Tropicals Inc. in Homestead, FL. “Leverage the Florida avocado’s size — often three times the size of a Hass.”

Jose Rossignoli, general manager of the tropical category for Minneapolis, MN-based Robinson Fresh, says studies show selling multiple sizes/packages will increase sales incrementally.

“Customers like to have a choice,” says Rossignoli. “I recommend having the different sizes of avocados located in the same proximity in your regular schematic so consumers know their choices. Of course, if there is a front-end table, a free-standing bin, or a display rack — and you want to merchandise a promotional size there — then that is great! Secondary displays always sell more.”

3) Bag & Bulk. “We carry five SKUs of avocados: extra-large, large, medium, a Florida-grown when available, and a 4-count bag,” says Northgate’s Cano.

There are definite benefits to offering fruit individually and packaged in multiples. In fact, shoppers who purchase both bulk and bagged avocados buy the fruit more frequently (10 supermarket trips annually) and spend more ($42 avocado spend per year) than bulk only (5 trips at $17) or bag-only (2 trips at $13) buyers. This is according to HAB’s 2015 report, Keys to the Cart: Key Shopper Insights for Driving Hass Avocado Sales at Retail.

Currently, only 2.2 percent of avocado sales are bagged fruit, with bags ranging from 3 to 62 ounces in weight, according to Nielsen Perishables Group data for the 52-weeks ending July 2, 2016. Yet, Q4 of 2015 represented the highest contribution at 3.0 percent or nearly double Q2 (1.8 percent) and Q3 (1.9 percent).

“We find that merchandising both bulk and bagged avocados together in the produce department help promote sales of the category,” says Scott Ross, eastern region business manager for the Giumarra Companies, headquartered in Los Angeles, CA. “We offer high-graphic, nutrition-focused bags with a prominent display rack to highlight the grab-and-go convenience for busy consumers. Bagged and bulk avocados complement each other and offer different options to consumers who are buying their avocados for different purposes.”

4) Organic. “Today’s diverse customer base for avocados desires both conventionally and organically grown fruit,” says Dan Acevedo, director of business development for Newport Beach, CA-based Green Fruit Avocados.

Availability of organic fruit falls into a lower tier of drivers for avocado buyers across the board; however, it has been climbing in importance for enthusiasts and lovers, according to HAB’s 2015 User Segmentation Analysis report. By definition, enthusiasts are those who purchase between 37 and 120 avocados annually, while lovers buy 120 or more each year.

“Organic avocados can be challenging to source during some months,” says Timothy Spath, avocado sales and inventory manager for LGS Specialty Sales, Ltd., in New Rochelle, NY. “However, we are hearing there will be production out of Jalisco, Mexico in the future, which should support availability in the fall.”

5) Display & Cross-Display. “Increase the dimensions of fresh avocado displays and offer additional sizing for versatility and price options. Add secondary promotional and permanent displays,” recommends Maggie Bezart Hall, vice president of trade and promotions for the Dallas-headquartered Avocados from Mexico (AFM).

Displaying color that breaks with complementary produce can positively impact sales.

“Avocados placed alongside red, orange and yellow tomatoes evoke the colors of autumn leaves as part of fall produce sets,” says the CAC’s DeLyser.

Northgate sells its avocados not only in produce, but in other departments such as meat and bakery.

“Cross-merchandising avocados drives higher rings, inspires/triggers impulse purchases and facilitates shopping convenience,” says Guimarra’s Ross.

The Peruvian Avocado Commission, based in Washington, D.C., sowed the seed in consumers’ minds of the diverse uses of avocados this summer by conducting over 1,000 in-store demos at participating locations of Costco, Sam’s Club and Wal-Mart from the Fourth of July through Labor Day. Two and three ingredient recipes demo’d included avocado smoothies, bite-size avocado toast and chocolate avocado mousse.

“We do this (in-store demos) not just for our season, but to grow the entire category by highlighting the fact that there are more ways to enjoy avocados than just guacamole,” says Xavier Equihua, chief executive officer and president.

To make fall cross-merchandising easier, AFM’s 2016/2017 Merchandising Catalog offers retailers more than a dozen types of rolling racks, stands and bins that can add creative secondary display space for bulk and bagged fruit. Each display comes with bag dispensers to allow for easy pick-up in any part of the store.

Robinson Fresh’s Rossignoli says it’s always a great idea to pair avocados with other primary recipe items. “Try to offer a recipe at the display to inspire a new use,” he says. “Tomatoes, onions and chips are a natural for making guacamole. Don’t forget tie-ins with burgers and buns for a summer burger feast; or tortilla wraps, salad fixings and chicken for a festive chicken avocado wrap.”

6) Health. The health benefits of avocados are the primary reason consumers purchase avocados, according to HAB’s 2015 User Segmentation Analysis Report.

“We are working on a new bag program that highlights the nutritional benefits of avocados with a focus on ways kids can enjoy them and the fact that avocados are a great, palatable first food for babies,” says Green Fruit’s Acevedo.

Inform customers about the nutritional differences between a Hass and Florida green-skinned avocado, says Brooks’ Brindle. “For example, Florida avocados have half the fat and a third fewer calories. This builds a consumer value proposition that considers holistically price, size and health benefits.”   Supermarket registered dietitians can play an important role in encouraging avocado usage for back-to-school health agendas/efforts by offering nutritional comparisons between spreads and dressings, according to the CAC’s DeLyser. “After-school treats that include avocado and other produce are great promotional opportunities in late summer and early fall.”