DRIVING LEMON DEMAND
Building Effective Sales and Marketing Plans
Kevin Fiori
August 25, 2014
PRODUCE MARKETING ASSOCIATION
Agenda
• Issue – Lack of international lemon demand
• Lower demand in existing lemon markets
• North America and Japan
• Lack of use in many export markets
• Ad pricing had no impact on demand
• Actions:
• Determine what factors influence demand
• Share findings with stakeholders
• Take appropriate actions
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Fresh Lemon
US Per Capita Consumption
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
0.0
Lemons
Limes
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Determine what factors influence demand
• Contracted Dr. Albert Kagan
• Research Professor of Business and Director of the Business
Research Center from Arizona State University
• Expertise is agribusiness
• Focus of Study
• Supply – Quantities of goods with respect to their prices.
• Demand – Pricing of goods with respect to their quantities.
• Elasticity – Sensitivity of pricing when quantities change.
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Initial results of sell through data
•
The calculated elasticity for all fresh fruit is -0.6.
•
Lemon elasticity equals -0.00023.
•
Demand is very inelastic which means that a substantial change in
price would not have a significant impact on demand
•
Conduct a more detailed study to show the effects of
complementary products
•
Results or study:
•
Lemon demand is subject to a secondary demand effect from other
consumable products.
•
Consumers don’t eat lemons, but use them as an ingredient or flavor
enhancer
•
Identify main drivers of lemon demand
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Lemon Consumption
This model indicates that for every dollar increase in expenditures of food
consumed away from home in U.S. per capita consumption of fresh
lemons will increase by 0.02 pounds (assuming the rest of the factors
constant).
This reinforces the concept that lemons are very inelastic
Big change in
lemon price
Old Price
New Price
Q1 Q2
Little or no change in quantity of lemons sold
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This is a two step process.
Step 1
Elasticity allows for the identification of the relationship between the driver of demand
(fish) and the lemon quantity demanded (not the lemon price at this stage)
For elasticity the interest is on determining the lemon quantity demanded NOT THE
decline IN PRICE
Elasticity Step 1:
Determines Quantity of Lemons
Demanded trough cross price elasticity
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Actions Following Study
•
•
Share finding internally
Redesign and implement sales and marketing plans to
build demand
• Price – This becomes a lower priority in building demand
• Product – Align with primary drivers of demand
» Fish, liquor, water, lemonade
• Promotion – Cross promote with the primary drivers
• Placement – Place product next to the primary drivers
• People – Align Sales and marketing staff’s activities
consistent with findings
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Recipe Ideas and Uses
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Recipe Ideas and Uses
Promote on social media with Sunkist fans,
followers, and pins
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Mixology with Sunkist
Position Sunkist citrus as
a enhancement
ingredient for
beverages:
• Explore partnerships with
beverage brands
• Build relationships with
trendy mixologists for
traditional and online
media coverage
• Satellite media tour to
promote entertaining
PRODUCE MARKETING ASSOCIATION
Holiday Entertaining with
Sunkist Satellite Media Tour
Mixologist to show how Sunkist citrus enhances
beverages
Placement in over 20 TV and radio programs in 170
cities
• 10.7 million impressions
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Sunkist Hot Lemonade/Korea
• Street vendors in
high traffic locations
• Warming up with hot
lemonade during the
cold winter season
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Lemon with Korean Soju
• Sampling Soju with fresh squeezed lemon juice
• Lemon Soju kit: Sunkist lemon, juicer and recipe leaflet
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Marinated Lemon Yuzu Tea
• A traditional hot and healthy tea with marinated lemons
in Korea and Japan
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Target: Influential RDs in mid-July
• Communicate the health benefits of fresh
citrus to RDs and their thousands of followers
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S’alternative® Awareness
Educate consumers to use fresh citrus
as a
healthy flavor alternative to salt
Partner with Johnson & Wales University (Culinary and
Hospitality Institution) with research and recipes to
promote the health benefits of reduced sodium
consumption
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Target: Foodservice Chefs
Target: Corporate foodservice chefs to promote
more fresh lemon use
Inspire and create media content for fresh lemons
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The Biggest Loser
• Popular Weight Loss
Network TV Show
• Retail Tie-In with Sunkist
Lemons and Grapefruit
• Packaging, In-Store
Displays and Signage
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Promo: Biggest Loser
Displays & Packaging
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Trade Advertising
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Water & Lemon Signage & Display
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Secondary Displays
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Displays @ Seafood & Beverages
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Promotions: Baby Lemons
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Foodservice Trade Advertising
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• Sunkist fresh-squeezed lemonade kiosks
• Currently in 5 regional amusement parks
• Expanding to 16 in 2014
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The Result
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Fresh Lemon
Per Capita Consumption
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Key Learnings
• This study is about lemons but its learnings are transferrable to all
varieties
• Consumers won’t buy a variety if:
• They don’t know what is it?
• They don’t know how to use it?
• It isn’t convenient to find and/or available in retail stores or
restaurants?
• Market development and expanding usage via recipes and effective
marketing campaigns are essential to expanding produce demand
• Our industry’s future is dependent on moving from transactional to
fact based sales and marketing.
• This is true for new and existing varieties
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