Real estate prices are skyrocketing. I don’t mean in terms of housing, but an even more dominating space for the likes of our industry: the produce shelf.
Here, both buyers and growers are working with limited square footage, where location is the keyword—literally and figuratively.
Between what consumers say they want and what the most current buying behaviors show, there is so much information and so little room to utilize it. Meanwhile, produce suppliers and retailers alike are sitting around the table trying to find out how to deliver the right combination and to seal the deal on the hot market that is fresh produce real estate. And, with premium categories like avocados, there are even more stairs to climb on the way to top sales. The key, California Avocado Commission (CAC) is sure, is a versatile selling strategy with bagged avocados as an important component.
Bags, dear readers, are the dream house if you want consumers to have the information and the convenience they so desire. With room to spare for anything from origin to recommended eating, not to mention an inherent boost in purchase, this is the strategy Vice President of Marketing Jan DeLyser assures me any Produce Director can hang their hat on.
Jan DeLyser, Vice President of Marketing, California Avocado Commission: Bagged avocado sales have been climbing for several years, and we believe the pandemic may have accelerated that success. The latest year for which we have a full year of retail sales data is 2020, which was a huge year for the avocado category with 22 percent dollar-sales growth. By comparison, bagged avocado sales increased 50 percent across the country, and in the huge California market, the growth rate for bagged avocados hit nearly 87 percent. Some of the markets in the Western region showed a triple-digit boost in bagged avocados, and volume share of the category ranged from 10 percent to 32 percent, depending on the market. So, while bulk avocado sales still represent the majority of category sales, retailers and suppliers have to pay attention to bagged avocados as well.
JD: Many factors are coming into play for this growth. Bagged produce sales, in general, spiked during the pandemic. Avocado consumers have evolved from buying avocados as a specialty item for occasionally making guacamole to using them to elevate sandwiches, salads, and more. The avocado toast phenomenon—which truly is phenomenal—helped push the category to a whole new level.
Marketing from the California Avocado Commission and importer organizations, including dissemination of positive nutrition messaging, continues to spur demand and has allowed the category to absorb significant increases in supply without price declines. All of this means that avocado shoppers are buying, eating, and serving avocados more often, which makes bagged avocados a convenient choice. We are seeing bagged avocados displayed on the shelf, in display bins, and on hanging racks; there’s an opportunity to push these displays outside of produce with complementary products and even near checkout to encourage impulse purchases.
"...Avocado shoppers are buying, eating, and serving avocados more often, which makes bagged avocados a convenient choice."
Jan DeLyser, Vice President of Marketing, California Avocado Commission
The produce industry knows that the locally grown message continues to resonate with shoppers, and those shoppers want to know where their produce comes from. Bags that prominently showcase the California avocado origin can attract even more consumers than those that do not. Some packers are doing an outstanding job of using the real estate on the avocado bags to communicate origin in a very appealing way.
JD: Surprisingly, not all retailers carry bagged avocados, or only carry them during select periods. Sales tend to rise during California’s avocado season, and we encourage retailers to merchandise both conventional and organic avocados, as well as bulk and bagged avocados. As long as demand keeps growing and velocity is high, there’s an opportunity to expand the number of avocado SKUs the way other produce categories, such as apples, have.
One challenge that bags could help overcome is identification of origin for online sales. Because the bags carry a UPC code, retailers can more easily highlight specific avocado bag SKUs and promote them on their online platforms.
JD: The California Avocado Commission works directly with retailers to customize programs that work for them. This can include displays, sales contests, social support, nutrition programs, and more. Our store locator tool helps consumers find where California avocados are merchandised when in season, and we can put programs together that help push shoppers toward our retailer partners’ stores.
JD: I’m very excited to continue our advertising campaign, The best avocados have ‘California’ in them. It resonates very well with our target market, and we are able to link our retail programs with the campaign effort. I’m most excited about retailer programs that call out California avocado origin or locally grown at the shelf, on display, or on the product itself.
Similar to finding California in the best avocados, there is most certainly a PO in every opportunity. With such a hot market ready and knocking, it’s safe to say that this category has premium location in the bag.