Driving apple sales through rising inflation

From The Packer | 3 May 2022

Overview of apples in the U.S. market, complemented by charts from Agronometrics. Original published on April 29, 2022. 

In this time of rising food inflation, Wenatchee, Wash.-based Stemilt says produce suppliers need to ask themselves two questions: “How can we drive retail? and “How do we help our consumers during these times?”

Sharing the final data of this year’s apple category from Nielsen over the last 12 weeks from Jan. 9 to April 22, Stemilt has released its latest episode of “Fast Facts: The Cast with Marketing Director Brianna Shales and Merchandising Manager Jocelyn Gerard.”

“One thing that was interesting is that apple prices are up 9.8% year over year in the month of March compared to 7% inflation for the total produce category,” Shales said in the video. “We’re outpacing the inflation in light of a shorter apple crop and the need for apple retails to keep up with rising production costs.”

Apples made up 6% of total produce department sales during this time period, according to Nielsen. This percentage was unchanged from last year at the same time. Nationally, apples were down in volume by 1.2% compared to last year. This is based on the crop size and overall apple supply, said Stemilt. Apple dollars are now up 9.2% year over year and have increased 1.2% just over the previous 12-week period ending April 22.

apple volumes by history 21

Source: USDA Market News via Agronometrics.
(Agronometrics users can view this chart with live updates here)

Organic apples are down 5% in volumes year over year, with dollars up 4.7%. The category represented nearly 12% of apple volumes sold during this 12-week period and made up 16.4% of apple category dollars. The top three club apples during this time period were: Envy (20% of club apple volumes sold), followed by Ambrosia (17.5%), and Cosmic Crisp (13.4%).

apple volumes by history 22

Source: USDA Market News via Agronometrics.
(Agronometrics users can view this chart with live updates here)

“Pink Lady has been getting super-star results over these past 12 weeks,” Gerard said. “Retailers will find opportunities this spring and summer to promote up-and-comers like Cosmic Crisp as it continues to grow in availability.”

Pink Lady, the No. 6 apple, has grown its share of apple volume over the past year in part to excellent crop qualities, said Stemilt. It was 6.4% of apple volumes compared to 4.3% last year.

March promotions of Cosmic Crisp led to the variety’s highest volume and sales impact to the category so far this season. Granny Smith is also a key variety for promotion focus in the coming months, noted Stemilt, adding that additional promotions will help drive apple volumes while narrowing Granny Smith’s 7.8% volume decrease compared to last year.

“One thing that I saw with Pink Lady apples is that they’ve grown their volume share from 4% to 6% in this last round of data,” Shales said. “I think that’s really important because we don’t see those types of step-ups, so it’s really driven off the crop quality, retailers getting behind that variety and consumers accepting it and enjoying it.”

In terms of bag and bulk, bag retails have grown nearly double that of bulk apple prices in the last year, according to Nielsen. They are up 13.4% year over year compared to bulk being up 6.9%. Approximately 57% of apple volumes are selling bulk versus 42% in bags.

The volumes of apples sold in bulk remain relatively flat compared to the same time last year, and bulk is the main promotion opportunity for retailers in the coming months, said the company. The average retail price per pound on apples during the latest 12 weeks was $1.92.

“The top three club apples were Envy, Cosmic Crisp and Ambrosia,” Gerard said. “I’ve seen a lot of repeat, multi-variety ads from different retailers across the country with two or three club apples that are available at a line price. I still see more need in stores for educating the consumer on the varieties. That is something that needs to improve and will only help sales and recognition through the variety.”

Getting behind varieties such as Granny Smith, Pink Lady and Cosmic Crisp will help drive success in the apple category during these late season months, said Stemilt.

The News in Charts is a collection of stories from the industry complemented by charts from Agronometrics to help better tell their story.

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