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Stemilt Growers | Roger Pepperl Q&A Pt 2: Apple Merchandising 201

In Part One of my apple merchandising Q&A with Stemilt Growers Marketing Director Roger Pepperl, the former produce buyer and merchandiser for the Midwest supermarket banner Meijer gave me a veritable instruction manual's worth of insight on how to best sell the popular fruit category. Now, in Part Two of my discussion with Roger, I asked him to dive even deeper into his merchandising catalogue to talk two oft-ignored merchandising topics: intent branding and organics.


Jessica DonnelJessica Donnel: What is intent purchasing and intent branding, and how can they translate into more effective merchandising?

Roger Pepperl: Since the beginning of packaged apples, companies would sell them in 2 or 5 lb sacks with no information, no labeling, and no branding. It was a horrible way to get people to connect to your brand and get them thinking about different ways to eat their fruit and purchase. Too often in produce we try to market to everybody, but if you market to everybody you market to nobody. That’s why today, intent branding can be an important tool for connecting with different types of consumers.

Roger PepperlIt’s all about tapping into why a consumer would want to purchase your product and tapping into consumers who want to buy your product. Maybe someone who is shopping for Red Delicious or in the bulk bin is more of a value consumer who doesn’t want to spend the money on a large bag of branded apples. But look at all the types of people who do want to spend that money. Look at the people who have kids, people that eat large numbers of apples a week, and the younger crowd that’s juicing their apples like crazy. There’s a lot of business to be done if you can find out who is open to spending more for having their intentions met.


JD: What are some ways Stemilt has tapped into intent purchasing and intent branding?

RP: One of our most popular intent branded program is our kids program for small apples, Lil Snappers®. In both organic and conventional, we’re encouraging 3 lb purchase sizes with 9 to 11 apples for a family of four. Think about it—that’s a super small and reasonable purchase for a family to make, but it’s still a bigger purchase than you would have if you were selling a typical 2 lb bag of apples. We don’t want to encourage less consumption of produce, so these 3 lb bags help us help retailers keep their tonnage up, as well as keep up volume and dollars. We market to kids in a way that is fun and speaks to parents that want a healthy, easy choice for their children.

We also have an Apple Lover program, with for 5 lb upright pouch bags that encourages larger purchases of bigger apples. These bags are perfect for once-a-week shoppers and people who just truly love apples. The Apple Lover pack increases the shopper’s purchase size, so we see a rise in volume, which leads to increased sales for the retailer. Earlier this year, we added an organic Apple Lover pack as well, which really captures that organic, health-conscious consumer.

Another program that is gaining popularity is our Fresh Blenders® 4 lb grab-and-go bag juicing apple bags. The number of people who are juicing their fruit is rising, and apples are one of the greatest fillers to provide sweetness and continuity in juices. We use misshapen or less colorful apples in these packs as opposed to our bags designed for snacking. This product is filling the gap for consumers who don’t want to purchase the super premium on apples, but who also don’t want to buy a bag of garbage apples for cheap. I think there are so many areas where we can create intent branding, and that is where people are dropping the ball and missing valuable merchandising opportunities.


JD: How does merchandising change when applied to organics?

RP: I think merchandising for organics is something that’s really simple, but it's a big subject to broach. When you go to a store today, you’re typically seeing three different types of answers to organic merchandising for produce.

You see one store that really recognizes that organics have taken off, and they address it by creating an organic section. Some retailers have done such a great job with their organics that they often compete with the rest of the produce department’s conventional section. But, more often than not, this setup makes it look like the retailer is saying, ‘I’m a specialty department, I’m 10 percent of the store, and I’m one table with 50 items on it.’ It just doesn’t work.

Next, you’ll see a produce department that says, ‘I don’t know what to do with these things, so I’m going to put them in a little tiny wicker basket in the back corner of the store.’ That just perpetuates the idea that you won’t be selling very much. We have a name for that at retail: “The Dirty Little Wicker Basket.”

And then you have the third option, where the retailer is totally embracing organic, building big displays, and really promoting their items. You see, there are two things to remember about the organic shopper when you go to build these displays. One, they are the largest purchaser of produce in the product department. Two, they buy more produce than any other consumer. At the end of the day, they want the same things that a conventional shopper does, just make it organic product instead.


JD: What have you learned about organic shoppers that you think retailers should keep in mind for merchandising?

RP: Organic, like I said, is the largest purchaser of produce, so don’t dumb down your purchase size with them. Expect them to buy more, not less. Why would you sell your largest purchaser a 2 lb bag of organic as opposed to a 3 lb one? Think about things like that. Often these consumers are empty nesters who have a lot of money, or they are parents who are concerned about what their kids are putting into their bodies. When you have kids, you're eating more food, not less. They want to buy more.

I find that when I buy organic, it’s usually because I’m wowed by one of the four Ps—placement, price, the right product, and promotion. You have to look at your organics section and say, ‘How am I achieving those four Ps?

Sometimes you have to do that with integration. Think of this problem: When you’re shopping and you see a big apple section at the front of a crowded store, do you think people are going to go in and buy from that display, then say, ‘Oh I’m going to put back what I just grabbed and go to the back of the store to the organic table and do it all over”? You’re losing consumers that way.


JD: What is the crossover market, and how can retailers use it to their advantage when merchandising?

RP: I think we tend to think of the organic shopper as hardcore organic. Well, as you and I both know, the biggest market today is probably the crossover market between conventional and organic. That will change someday, but it hasn’t yet. You have to ask yourself, ‘am I offering you different choices at the point of purchase, or am I expecting you to go to two points of purchase locations to make that decision?’ What happens is an obvious result, but we tend to overthink it. When you have an item you have a lot of organic product for, put an ad out, put a five-foot-by-ten-foot display out, and blow people’s minds. They’ll respond.

The same can be said for signage. Be crystal clear on the message that your product is organic so that, however you’re expecting the consumer to find organic products in your stores, the visual element is accelerated. Whether that’s with color coding on the shelf or a big organic symbol in the corner of your store, come up with a commonality in your signs that allows crossover customers and hardcore organic buyers to shop with their eyes quickly and easily.


Feel ready to spread your merchandising wings and fly your own produce department? Me too, but, just to be certain, I’ll make sure to keep Roger’s advice close at hand.