CMI has announced the national rollout of its new pouch bag line for Queen Bee Honeycrisp™ apples. The new program launched early this fall started as a test but was almost immediately expanded nationally due to strong demand from retailers.
“The CMI Queen Bee Honeycrisp™ project was developed this summer,” said Steve Lutz, Vice President of marketing for CMI. “With a large crop we knew there would be a big opportunity to drive additional Honeycrisp sales. At the same time, our national analysis of scan data results revealed that there was a big retail opportunity to increase dollars by creating options for supermarkets to devote more shelf space to Honeycrisp,”
According to Lutz, with only one PLU number, it is difficult for retailers to add Honeycrisp SKU’s except through poly bags. Lutz says poly bags have historically been used to attract a value oriented shopper. “Our research revealed that particularly with Honeycrisp, rather than focus on value there was an opportunity to entice consumers to actually increase transaction size by providing high quality pouch bag packages that better align with the Honeycrisp image.”
With the objective of designing a high quality package, CMI’s marketing team focused on solutions that would ultimately boost supermarket performance by offering new options to accommodate a variety of retail price tiers. The team ultimately developed three new high graphic color packages; a two pound and a three pound pouch for snack-sized fruit, and an industry-first with the two-count package for jumbo fruit.
BACKGROUND
Honeycrisp is the #2 apple in the U.S. behind Gala in terms of dollars. However, because Honeycrisp sells at substantially higher retail prices, it generates those dollars with about half the pounds of the #1 variety (Gala). Scan data analysis shows that with the high retail price of Honeycrisp, any cross category cannibalization away from other varieties and into Honeycrisp actually drives overall category performance. Average pricing during the October-December period last year was $1.57 lb. for the overall apple category compared to $2.48 lb. for Honeycrisp.
Honeycrisp consumers are heavy buyers. Loyalty card data shows that the average shopper buys 1.6 pounds per transaction for Gala and 1.4 pounds for Red Delicious. Purchase rates for Honeycrisp are approximately 40% higher than Reds and Galas, at 2.1 pounds per transaction. The combination of higher retail prices and larger purchases makes Honeycrisp buyers an especially valuable shopper for retailers.
MORE HONEYCRISP ITEMS DRIVE PERFORMANCE
A key characteristic of supermarkets with strong performance in the apple category is these chains do a significantly better job of leveraging the Honeycrisp opportunity. CMI conducted a performance analysis of 140 retail supermarket banners. The top 50 retail chains nationally in overall Honeycrisp sales averaged $1,822 per million ACV and 2 unique Honeycrisp items per store per week. The next 50 chains in Honeycrisp sales carried only 1.3 items (stocking two items for a short amount of time, one after that) but generated less than half the dollar performance at $723 per million ACV.
Queen Bee Honeycrisp Apples™ Video View the story of Queen Bee Honeycrisp Apples™. Click here or visit https://www.youtube.com/watch?v=Rv-3joSM8ME
For more information on this test or availability from CMI, please call 509-888-3427.
About CMI
Columbia Marketing International (CMI) is one of Washington State’s largest growers, shippers and packers of premium quality pears, apples, cherries and organics. Based in Wenatchee, WA, CMI delivers outstanding fruit across the U.S.A. and exports to over 60 countries worldwide. For more information, visit www.cmiapples.com
Source: Columbia Marketing International (CMI)