2023-24 apple production up 1.5%, so there are more opportunities for promotions this year.
Originally printed in the January 2024 issue of Produce Business.
Oncoming new apple varieties play a prominent role in modern retail apple merchandising.
“Apple varieties will continue to evolve, as each new generation of consumers develops its own tastes and preferences,” says Brenda Briggs, vice president of sales and marketing for Rice Fruit Company, Biglerville, PA.
Rice and many other major apple grower-shippers are offering a strong selection of new types of apples. “Our concentration is to have the very best tasting apples that thrive and grow well in the eastern United States,” Briggs says. “We offer the traditional flavor profiles of our core varieties, while exploring newer varieties that are growing in popularity with consumers.”
“We are cautious to select new varieties, because we compete against not only other apple items but also other produce items,” she adds. “We are very aware that less than a handful of new introductions will be successful.”
“Club apples are poised for promotions, and capturing favorites in promotions from a seasonality aspect is a great way to bring velocity to the category,” says Brianna Shales, Stemilt’s marketing director.
For example, she adds, the Cosmic Crisp brand is “evolving from a seasonal club to an everyday apple, and that is reflected in the data.”
Broadening the produce playbook with new varieties also means retailers can extend their apple season with quality apples. Roger Aguirre, director of apples and pears for Oppy, Seattle, WA, says apple mix “enables us to seamlessly provide customers with the freshest product for an extended period, ensuring we have a smooth runway for incoming crop, especially with our top varieties Envy and JAZZ.”
“We strategically plan for the upcoming volume to ensure we’re catering to different market demands throughout the year.”
Briggs highlights three newer varieties showing tremendous promise for Rice Fruit. First, she says the Lemonade brand “is bursting with a refreshing crunch and effervescent flavor profile, while giving a color break in the red apple line-up.”
At Rice, the Lemonade’s “engaging and bright blue packaging is eye-catching and pairs perfectly with its gorgeous yellow-blush color.”
Snapdragon brand is famous for its sweet and juicy flavor, as it is bred from a Honeycrisp apple, according to Briggs. This apple’s vanilla and spice notes fit perfectly in the fall and winter.
Briggs tabs EverCrisp as “the perfect hybrid fruit, crossbred between the Fuji and Honeycrisp. The ideal blend of its sweetness and crispness makes it great for baking and snacking. Perfect for spring and summer promotions, as its sweet flavor takes time to develop in storage before it hits shelves. This apple stays crisp for weeks and is a true crowd-pleaser.”
Diane Smith, executive director, Michigan Apple Committee, Lansing, MI, also touts EverCrisp as a great variety for the January-April time frame “because it actually has better flavor coming out of storage. It lasts a long time and keeps its crisp texture.”
Smith says Michigan apples will be available year-round for consumers to enjoy, and “sales organizations are working to address this opportunity with marketing programs.”
“Scratch last year’s apple plan because it’s time to turn the tide on this year’s big apple crop and move volume,” says Stemilt’s Shales.
She sums up the scene for the national apple industry, noting the October 2023 Nielsen retail scan data reveals apple dollars and volumes sold are trending down compared to the same time frame last year.
“Scratch last year’s apple plan, because it’s time to turn the tide on this year’s big apple crop and move volume.”— Brianna Shales, Stemilt, Wenatchee, WA
Shales, of Wenatchee, WA-based Stemilt, says retailers can reverse this trend with multi-variety ad promotions that boost volumes across the category and start growing apple dollars over last year.
Shales notes Honeycrisp volumes sold in October 2023 grew 4.7% nationally compared to October 2022, but dollars dropped a percent. The remaining core apples — Gala, Fuji and Granny Smith — decreased in volumes and dollars sold over last year.
“There’s so much opportunity for promotions on apples this year, especially compared to last year when we saw tight supplies on key items,” says Shales.
“With all apples harvested, now is the time to focus on multi-variety promotions and growth in apple volumes over last year. Dollar growth will come as volumes in the category increase,” she says.
Shales says all regions were down in apple volumes year-over-year, with some declines larger than the national average. “Regionally, apple volumes sold in the Midwest were down 8.5% year-over-year, while sales were down 7.3%. The Northeast and West region were in line with the national averages, while the South region was 9.1% down on apple volumes this year, and 5.2% down on dollars. The average price for apples dropped 2 cents year-over-year to $1.89 per pound.”
“Honeycrisp volumes are up year-over-year in the Northeast and South regions, but lagging behind last year in the West and Midwest,” says Shales. “Finding the sweet spot on retail price and promotion with Honeycrisp, and all core varieties, will be important in reversing the declines in the apple category over last year.”
For club apples, she adds, the Cosmic Crisp brand ranked eighth in October and is poised for a big return when its new season begins in November.
October data reflects a 14% increase in SweeTango brand volumes sold, with growth of over 35% compared to last year during a large promotion week. The increased volumes of SweeTango nationally this year bring new promotion opportunities to help retailers drive dollars to the category.
Shales notes the organic crop follows the same trend in volume as conventional apples this year.
“Looking at the organic data in October, volumes are up 7.2%, while sales are up 3.7%,” she says. “Organic apples account for 15.8% of apple category sales. Regular promotions for organic apples, especially on the volume driver bags, will be needed for retailers to see success within the whole organic category this season.”
“Organics are off to a positive start with volume and dollar growth over last year,” says Shales. “This is a strong year for organic apples and category growth because we have great qualities and promotion opportunities. Upsizing on pouch bag sizes with 3-pound and 5-pound will help drive organic volumes. It’s time to plan big things for the apple category to grow volumes and dollars simultaneously.”
MERCHANDISING AND PROMOTION
“In the age of technology and connection, social media has become the hub for both retailers and consumers,” says Rice’s Briggs. “The opportunities to educate on topics like apple varieties, growing practices, and farming techniques are endless. Knowing where your food comes from, how it’s grown and who is growing it is a story that we’re passionate about sharing. Our hope is that this only continues to grow.”
Audrey Desnoyers, director of business development and key account manager for Oppy, says Oppy’s winter marketing initiatives include extensive ads, emphasizing the quality crop and high color.
“Apples are a go-to promo item in the winter, with great opportunities for cross-promotions, such as pairing apples with caramel dip, providing enticing recipes for the holidays and a ‘healthy eating’ theme for the new year.”
Oppy’s Envy apples were spotlighted with “The Ultimate Holiday Apple” theme alongside its extensive marketing campaign with Hallmark Channel, which included product placement, recipe tips and shoppable recipes in the Hallmark movie checklist app, Hallmark e-newsletter and social media features.
Desnoyers notes many retailers feature multiple apple varieties in ads, usually with the same price for both. “Premium apples may be highlighted on the back page, reflecting the strength of apple sales during the season.”
Also, in the fall, apples typically dominate displays, whereas in the winter, apples share the spotlight with citrus and imported grapes. Other items become more abundant in winter displays.
Desnoyers says there was an excellent winter crop, especially for Envy apples. “Though we did have a larger volume of smaller-sized fruit, we were able to introduce a lot of folks to our convenient 2-pound bag to address this.”
Oppy sources apples from various regions, including Washington in the U.S., British Columbia and Nova Scotia in Canada, along with New Zealand, Chile and South Africa.
As to packaging trends, Shales says the bulk-to-bag ratios were consistent in October 2023 compared to 2022, with 42% of apples sold in bags and 57% sold in bulk.
“Traditionally, bags have been a volume and value offering at retail,” says Shales. “They’ve migrated into an everyday offering, and that means they should be part of the regular promotion mix in a multi-variety strategy. Consider bolstering bag volumes with 3-pound pouch programs like Lil Snappers and 5-pound pouch bags to increase purchase size. These tactics fit well together with regular bulk promotions to grow volumes of apples.”
Desnoyers adds the preference between bulk and packaging depends on the apple size each year. “While bulk remains a priority, we bring interesting packs to the market, like EZ band, which will be rolling out on Envy in early 2024. It’s a new sustainable packaging solution to help sell large-sized apples in-store and online. It is made from 100% paperboard and is approved for home recycling.”
Briggs says offering environmentally friendly packaging “has become paramount for packers, retailers, and consumers.”
“Having packaging that educates consumers on properly storing fruit to extend shelf life while also directing consumers on how to properly recycle packaging like plastic bags is a simple adjustment to make that not only reduces food waste, but also helps to keep materials out of landfills.”
2023 US APPLE SUPPLIES
According to USApple’s analysis of U.S. Department of Agriculture (USDA) data, total U.S. apple production for the 2023-24 crop year will be 250 million bushels. This represents a 1.5% increase compared to last year’s production figure. These figures are more comprehensive than USDA data, which only looks at the top seven apple-producing states. USApple analyzes the production from states outside of the top seven and adds that back into USDA’s figure.
Authored by USApple Director of Industry Analytics Chris Gerlach, USApple’s report indicates, “With considerable increases and decreases from top apple-producing states, we’re pleased to net out with national apple production that will not only meet last year’s figure but exceed it slightly — there will certainly be plenty of high-quality U.S. apples available to consumers.”
Smith indicates Michigan apple growers harvested about 32 million bushels of apples in 2023. That quality “has been excellent with good pack-outs and great appearance and flavor,” she adds.
“With a similar sized crop last year, our industry has proven success in not only producing large, good quality crops, but also marketing them throughout the spring and into summer. There are, for sure, a lot of apples in storage. Sales organizations will work through the year to get those apples into the marketplace.”