Chilean promotion strategy deep and wide
by Tad Thompson | January 09, 2011
With shiploads of fresh Chilean fruit headed to U.S. seaports, "Our
responsibility here is to make sure there is a home for the fruit when it
arrives," said Tom Tjerandsen, who spoke from the Sonoma, CA, headquarters
of the Chilean Fresh Fruit Association.
Mr. Tjerandsen, managing director of North America for the Chilean fruit
promotion group, said that one of the association's high-profile marketing
tools is an aggressive television advertising program that is scheduled to run
from the third week of January into April.
Mr. Tjerandsen said that the TV advertising will run in 40 spot markets
around the United States. This coverage is expected to be viewed by 83
percent of the nation's households. This advertising series will be "retailer-
tagged," meaning that retailers who participate in particular weeks receive
television advertising support in their marketing area, with taglines at the end
of the ads directing consumers to buy Chilean fruit at that particular chain.
The association operates with a total annual promotional budget of about
Mr. Tjerandsen's group this winter is also sponsoring a national two-month
in-store radio promotion. As shoppers listen to a special radio network
broadcast through the stores, "every 20 minutes the music stops and sends
consumers to buy Chilean fruit in the produce section," he said.
Retail promotions have long been the primary target of Chilean fruit
promotions. But Mr. Tjerandsen said that "one of the fastest growth areas for
us in sales is the foodservice industry." Association merchandisers are
working directly with foodservice distributors, and "we are also developing
business in those channels through work with menu developers, planners and
Foodservice interest in Chilean fruit has grown in large part because Chile is a
sector of a global fruit industry that now can provide menu planners with a
12-month seamless supply of "a number of items," he said. "That is pretty big
news to a lot of people in the foodservice industry. This is an area of special
focus for us. We are seeing great strides forward there."
Mr. Tjerandsen said that foodservice distributors "for years hated produce,"
adding that one large national distributor "refused to handle anything" except
for the largest accounts "unless it was heads of lettuce. Then the small
specialty foodservice distributors became very big."
For newly arrived distributors, the produce category "became virgin country,"
he added. "The salespeople could sit on the phone all day and write what was
ordered" by foodservice outlets. "No one ever challenged them to see if they
could actually try to increase their produce business." Then Chilean fruit
merchandisers created sales contests to see which distributors could show the
largest percentage of increased sales over the previous year.
That "modest investment created major returns," Mr. Tjerandsen said. "We've
seen tremendous growth in volume" of foodservice industry sales.
On the retail sales side of the business, the Chilean Fresh Fruit Association for
the last two years has purchased national data collected from retail sales
scans. Mr. Tjerandsen had "two conjectures" that were each verified by
national retail sales data.
"One was that people who bought Chilean fruit tended to pay more for fruit
and the shopping basket total was greater" by a factor of 1.5. If retailers can
increase "their volume by 50 percent, that is fabulous." Hard numbers also
showed that "the people who bought Chilean fruit had a larger purchase ring."
A second conjecture was also proven correct: "People who bought Chilean
fruit tended to buy higher margin items."
Now the association's merchandisers can tell retailers that "it is productive to
have Chilean fruit purchasers" within their clientele because these people buy
more food and buy high-profit items.
This information is now being printed by the Chilean fruit marketers. "We are
in the process of bringing this to retailers' attention," said Mr. Tjerandsen.
"This is a shopper they ought to be going for."
This also addresses "the age-old question of there only being so many
advertising dollars." When retailers have many wintertime produce items to
advertise, they have said, "Give me a reason ... to advertise Chilean fruit. Now
we have an answer."