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Zespri: The Golden Age of Kiwifruit

"First and foremost, it’s about our consumers and making sure we’re providing premium-quality and the best-tasting kiwifruit,” Carol Ward, Chief Innovation and Sustainability Officer for Zespri International Limited, tells me.

From a foraged food endemic to China to an international curiosity, a burgeoning specialty interest to a popular commercial crop marketed worldwide, the kiwifruit category—made up of members of the genus Actinidia—has experienced a profound transformation over the last 125 years. The fruit has changed linguistically—from the “macaque peach” to the “Chinese gooseberry” to the “kiwifruit.” Its place in our popular imagination has shifted. It’s even changed colors.

In 2019, it’s hard for many North Americans not to speak of Kiwis and kiwifruit in the same breath. In many respects, the fruit has become almost inseparable from our cultural conceptions of New Zealand. That is, in large part, thanks to the work of Zespri International Limited.

Since the formation of Zespri in 1997, the company has been committed to producing the best possible product—providing the healthiest, safest, and most sustainably-sourced kiwifruit. It’s the company’s mission to do so in a way that supports growers and ensures the continued health and wellbeing of both the company’s end consumers and those growers whose efforts sustain its operations and our industry.

Carol Ward, Chief Innovation and Sustainability Officer, Zespri International Limited“Zespri is committed to growing a better, healthier future, and sustainability is our passion,” Carol explains. “We work with leading research institutes and partners to understand our environmental position. We have a cross-functional team spanning our industry to assess the feasibility of new sustainability initiatives, including production methods and environmental impact. Our goal is to leave the future in better condition for generations.”

Owned by 2,500 current and former New Zealand kiwifruit growers and cooperatively controlled by producing growers, Zespri works tirelessly to do more than provide fresh and nutritious Zespri Kiwifruit to consumers year-round. The company is working to improve the lives and livelihoods of growers, to ensure the continued viability of those growers’ work, and to ensure the future of the industry is always brighter than the past.

Because, while Zespri’s outlook is bright, Carol explains to me, its roots had to find purchase in unfavorable soil.

In 1997, facing unprecedented challenges in terms of both international financial hurdles and perpetual oversupply, a group of New Zealand growers banded together to found Zespri International Limited—with the goal of creating a global marketing organization representing the aims and interests of kiwifruit growers.

“You can actually trace our origins to the challenges faced by the New Zealand kiwifruit industry in the 1980s. There had been rapid expansion of the industry and large crop volumes, so supply exceeded demand, and combined with unfavorable interest and foreign exchange rates, the price of kiwifruit had dipped to an all-time low,” Carol explains. “So, rather than competing against each other, growers came together to establish a cohesive market-driven strategy.“

Instead of competing among each other in a narrow preexisting marketplace, these growers created what would become a sophisticated worldwide operation—expanding the scope of the kiwifruit category along the way and working to provide the best possible returns to Zespri’s grower partners.

Kiwifruit growing along trellises in Zespri growers’ orchard; thanks to the protracted growing season, kiwifruit orchards operate up to 240 days a year

Zespri has, since 1997, been able to deliver strong sustainable returns to growers and provide sweet-tasting and premium-quality kiwifruit to the world, Carol tells me.

The effect the marketing organization has had on the category has been prodigious, particularly in North America. Carol notes that growth has gone up another gear since Zespri began marketing its SunGold Kiwifruit in North America in 2015.

“Kiwifruit has grown quite a bit in the past 100 years—even more so in the U.S. in the past few years, which is being driven by our proprietary variety, SunGold Kiwifruit,” says Carol. “Zespri SunGold Kiwifruit is a big factor driving growth in the category. Consumers are really enjoying this fantastic product—offering huge nutritional benefits as well as great tropical-sweet taste. Within Zespri, we’ve put a lot of focus on developing and promoting our brand so that consumers across the world recognize Zespri Kiwifruit as delivering that premium taste and quality.”

Along with our partners, we invest approximately
$20 million a year in
the breeding program, which has been running since the 1980s.
—Carol Ward, Chief Innovation and Sustainability Officer, Zespri International Limited

Carol tells me that, according to IRI data, Golden Kiwifruit dollar sales trend outpaced total fruit sales by more than 116 points in the 52-week period ending August 12, 2018. A big part of that growth has been Zespri’s attention to lifting the profile of kiwifruit in places like North America where kiwifruit has room to continue to gain ground and establish its place as a staple food.

Recently, Zespri has found tremendous success in growing the category through consumer campaigns in the region—building its brand awareness and bolstering the category with its SunGold variety along the way.
“It’s a big focus of ours to be closer to our consumer. In America, for example, we’ve had some great success with last year’s A real snack, for real life consumer campaign, which was a national digital campaign focused on growing our brand awareness amongst busy mothers,” Carol says. “The campaign was predominantly based around our SunGold Kiwifruit and included things like in-store demonstrations, point-of-sale materials, geo-targeted digital coupons, and display contests.”

A sorting line in one of Zespri’s state-of-the-art facilities

Complemented by a real giveaways for real life promotion offering prizes like a ‘staycation’ at a luxury hotel, a cleaning service, grocery delivery, and a college starter fund, the kiwifruit marketer seemed to strike marketing gold, growing its brand by leaps and bounds in the last year alone.

“We were thrilled it got such a great response, with our brand awareness up 41 percent nationwide compared to last year,” says Carol.

Beyond campaigns that expand the eyes and cart sizes of consumers as they relate to kiwifruit, Carol tells me that Zespri is continually reinvesting in research and innovation. The company is working to develop products that fit the needs and desires of an ever-changing clientele spanning more than 50 countries.

“In partnership with Plant & Food Research, we invest approximately 20 million dollars a year in the breeding program, which has been running since the 1980s,” adds Carol. “That makes it one of the largest new cultivar breeding programs in the world. Our focus at the moment is on developing a new green and a red cultivar, which are going through pre-commercial trials, and we’ve got a few other promising things in development. Watch this space! I think there’s a lot to be excited about.”

Though SunGold has been and continues to be a boon with consumers, the variety also provided Zespri’s growers with much-needed relief during a devastating outbreak of Psa—or Pseudomonas syringae pv. actinidiae—a bacteria deadly to kiwifruit vines that was first discovered in 2010. By 2012, Carol tells me, Psa had spread to 35 percent of all New Zealand kiwifruit orchards. It was thanks, in large part, to forward thinking breeding programs like Zespri’s that Psa-resistant varieties like SunGold were developed—enabling the industry to weather what could otherwise be a devastating blight.

A kiwifruit orchard operated by Zespri’s grower-owners in New Zealand

“Our industry was able to come together and move quickly to develop a response plan. The government provided 25 million dollars in funding, which was matched dollar-for-dollar by the industry, and a new independent body—Kiwifruit Vine Health—was set up to manage research into the disease and our industry’s biosecurity response,” Carol says. “Within Zespri, we were in a fortunate position in that we’d made good progress with SunGold, which was much more resistant to Psa than its gold predecessor Hort16A. Based on its promising results in trials, we fast tracked its release, providing 2,000 hectares of SunGold to growers. From those initial graftings, it’s been incredible to watch the increase in demand for it across the globe, and it’s led our recovery. It’s a good reminder about the importance of continuing to innovate.”

Zespri brand kiwifruit being  packed for shipmentAnd innovate Zespri does.

“For SunGold, it was a 10-year process to bring that fruit to market, which included regular assessments of taste, fruit yield, resistance to Psa, storability throughout the supply chain, and a range of other factors. New varieties are actually one of thousands of potential new products that make it all the way through to market,” explains Carol. “Innovation sits at the heart of Zespri and we’re constantly considering what’s next. That’s true not only in the work we do to explore new cultivars like SunGold that provide different flavored and colored fruit, but also in the work we do to develop tools and techniques to grow Zespri Kiwifruit profitably and sustainably in light of threats like Psa. It is a long process using natural plant breeding and bringing a new product to market requires years’ worth of development and exploration, which we undertake in partnership with our colleagues at Plant & Food Research.”

On the opposite side of its business, Zespri continues to work toward producing the best possible returns for its growers. It’s in the spirit of cooperation that the company continues to maintain and cultivate grower ownership.

“Our work to date on this has involved extensive industry consultation and changes to our constitution so that we can avoid a situation where ownership moves away from current growers supplying Zespri,” Carol explained. “We want to enable more growers to become shareholders and create strong alignment. As a result, this year we had a targeted share offer and buy-back program that provided an opportunity for growers to buy shares and for shareholders who no longer produce kiwifruit an option to sell shares. It was a good step forward in strengthening grower ownership and control of our company.”

With a strong foundation in grower ownership, a forward-thinking research and development program, and successful consumer campaigns building brand awareness in North America, Zespri appears to have all the tools in place to provide the best kiwifruit possible and to continue to expand on those possibilities—growing the category in new and unprecedented ways.

Zespri is committed to growing a better, healthier future, and sustainability is our passion.

“It’s a really exciting time for Zespri,” says Carol. “I think you can expect to see us continue to put consumers and what drives them to purchase our kiwifruit at the heart of our strategy for the upcoming year, and the years ahead. We’ll be looking to ensure we keep our brand top of mind for consumers through our Zespri Global Supply strategy of providing consumers with Zespri Kiwifruit for all 12 months of the year including sourcing fruit from our non-New Zealand-based growers in the Northern Hemisphere. And of course, hopefully making progress on that red kiwifruit.”

With Zespri on the case, the next innovation in the kiwifruit category is always just around the corner.