Page 92 - Index

organic marketing bananas
put on the organic banana supply chain, but she is still optimistic for the category’s poten- tial including the complementary and rela- tively more recent growth seen for organic plantains.
“ e only thing we can do is just become a little more e ective on every single front,” she says. “It gets to a point where they can’t and they won’t be able to grow organic if we keep pushing the prices down.”
Her observations are consistent with the data. Chiquita’s Postell references Nielsen Perishables Group’s observation that the price gap per pound between conventional and organics has narrowed to an average of $0.21 in 2018, compared to a price gap of $0.28 in 2011.
“Our main recommendation to retailers is for pricing strategies to balance the role of each of these two segments considering also the sustainability of the supply chain given the organic production constraints,” says Postell. “All of this must certainly be in pace with each individual retailer’s pricing strategies.”
Velazquez urges retail buyers not to consider the higher price as a “premium,” because organic bananas are “a lot more expensive to grow.
“We are growers, but we’re also distributors — so we see both sides of the coin,” she says. “I believe organic produce has to be available for everybody, but we have to educate the consumer on what it takes to grow organic, that it cannot be the same price as conventional.”
If consumers are to be willing to pay more for organics, a signi cant level of educational activity and branding will be needed. e approach tends to vary between the pure-play organic companies and those that deal in both organic and conventional.
“Retailers need to highlight organics in their produce sections and di erentiate them from other products,” says Christou of Del Monte. “Making organics available and educating consumers on their bene ts could also help invigorate sales in this category.
“Retailers should adopt tactics such as eye-catching promotional items and merchan- dising activities that entice and educate consumers,” says Christou. “ is might include development of seasonal POS for shelves, improved labeling information about the product nutrition and convenience, and displays close to the checkout and entrance of the store.”
He adds strategically placing secondary displays in areas such as the cereal aisle will also help lift banana sales.
Dole’s Gold eld says the core target of his company’s organic bananas is moms and dads wanting to create healthier meals for their
92 / SEP TEMBER 2019 / PRODUCE BUSINESS
families. But is this goal best achieved through a separate organic section or keeping organic and conventional side-by-side?
“An argument can be made for both,” he replies. “In those regions where organic is already widely accepted, such as major urban centers and at retailers that carry signi cant amounts of organic produce, stocking organic bananas in an organic produce section makes the most sense.”
In contrast, Gold eld says placing the two next to one another will likely do more to grow new users in areas where organic is yet to hit mainstream status.
“My recommendation to retailers is to use both strategies simultaneously to ensure you capture both types of consumers,” says Gold- eld.
Chiquita’s Postell claims organic bananas perform best when displayed near conventional bananas in order to capture crossover shopping.
“Assortment strategies between conven- tional and organic bananas should be aligned with each subcategory proposition to best maxi- mize total category pro tability,” says Postell. “Similar to their conventional counterpart, color and appearance are drivers in the buying decision process. Hence, visual merchandising tactics and point-of-sale material can highlight organic products and assist in boosting sales.”
LEVERAGE BANANAS WITH CSR
Gold eld says consumers are largely educated on the di erences between conven- tional and organic on the shelf, but they could still learn more about the speci cs of organic production.
“In addition, consumers often confuse and equate organic with social responsibility,” he says. “Retailers can leverage this by sharing information at the shelf about their Corporate Social Responsibility [CSR] e orts to build a
stronger rapport with the organic shopper.” For organic-only banana companies CSR is very much intertwined with their sense of purpose, often in conjunction with certi cations like Fair Trade or, in Organics Unlimited’s case, the GROW (Giving Resources and Opportu-
nities to Workers) program.
“Companies that are 100 percent organic
and Fair Trade (OGFT) — which are few and far between — aren’t able to blend margins across conventional and OGF T products to o er a lower price,” says Angelica Hicks, banana product lead at Oke USA in West Bridgewater, MA.
Oke USA trades its bananas under the Equal Exchange brand, with distributors on the East and West Coasts as well as the Upper Midwest selling the fruit mostly to indepen- dents or community food cooperatives.
e bananas are sourced from associations in Peru (APOQ and CEPIBO) and Ecuador (AsoGuabo), bringing a “di erentiating factor” that Hicks says is valued by alternative stores.
“One of the most important aspects of organic production, and more speci cally of Fair Trade, is that consistent, higher prices allow small farmers to organize and create their own export businesses,” she says.
She describes bananas as an “interesting challenge” for merchandising and promotion, seeing as they often have minimal to no pack- aging.
“ ere are typically not many brand options for consumers at the store, which means the shoppers spend little time thinking through their choice,” she says. “For these reasons, our approach is twofold: we focus on short, clear messaging with shelf-talkers and posters at POS, and outside of the produce aisle, we create interactive campaigns designed to get produce sta and consumers thinking deeply about their banana choices and small farmers’ livelihoods.”