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Despite crop woes, apple marketers in a healthy position

CHICAGO – The second and final day of the 2012 Apple Crop Outlook & Marketing Conference began bright and early the morning of Aug. 17 with the USApple state of the industry report and business meeting, and concluded with the announcement of the 2012 U.S. Apple Crop Forecast.

The keynote address was presented by Robert B. Tucker of The Innovation Resource, who spoke on the topic of driving growth through innovation and how that can be applied to the apple industry. He noted that the most important capabilities for growth are embracing the opportunity mind set, collaborating with customers and partners, involving everyone in the enterprise, and implementing idea management systems.

“Where assumptions end, innovations can begin,” Mr. Tucker told the apple growers and packers at the meeting.

Following his presentation, Reggie Griffin, formerly of The Kroger Co., spoke on the future of produce retailing.

“Our future is very fast, very furious and very stressful,” he said. And although the apple crop forecast for 2012 is significantly less than recent years, Mr. Griffin still said that “apples are in a real healthy position” when it comes to selling them to customers.

Mr. Griffin spoke about the “four P’s of marketing” -- product, price, placement and promotion -- and noted that there’s a fifth and less heard of “P” which is actually the most important: people.

“The customers are the people who keep us in business,” he said. “As an industry, we spend too much time on the first four and not enough time on the fifth.”

Mr. Griffin added that today’s customers are “totally confused” when it comes to food. This is a result of too many mixed messages, he said.

Are organic foods better than conventional? What’s the difference between organic and local? And how do retailers even define “organic” produce? These are just a few of the questions confusing consumers, Mr. Griffin said, adding that all these new choices can be overwhelming to the average customer.

He also encouraged conference attendees to never “underestimate where the customers are going,” referring to the need to keep an open mind about the future of produce retailing and embrace changes, such as online shopping. Seniors, middle-age people and young people all think differently, he said, and it’s the industry’s job to figure out how to connect to them.

According to Mr. Griffin, there are five things that will drive the decisions being made in today’s market: value, convenience, technology and personalization, ethnicity and age, and wellness.

“As an industry, association and individual company, if we can figure out how to address these five things, we will be more successful,” he said, adding that the apple industry is “unique” because of the “positive message” it carries.

“Consumers recognize that the items we sell are good for them,” he said. “We have a great message to tell and a great product to sell, what we have to do is inform the consumer.”

As for the consumers, they should expect a smaller apple crop than normal this season, however, the quality of the crop remains strong.

The total 2012 U.S. Apple Association production forecast for the entire United States came in at 202 million bushels, around 10 million bushels above the U.S. Department of Agriculture forecast released on Aug., 10, and about 10 percent less than last year’s crop.

“There are a lot of smart people in this room,” Philippe Binard, secretary general of the World Apple & Pear Association, said in his closing remarks. “This industry will manage with what we have to work with this year.”