WENATCHEE, Wash. — It is a simple equation: the bigger the cherry crop, the greater the percent of consumers who will bring cherries home from the grocery store.
In 2010, the percent of households who consumed cherries was 27%, according to Steve Lutz, Wenatchee-based executive vice president with Perishables Group, West Dundee, Ill. That estimate is based on loyalty card data, Lutz said.
At 27%, Lutz said the household penetration of cherries in 2010 was similar to avocados, which were purchased by 29% of households.
All types of households buy cherries, and “empty nest” households are a big buying demographic for cherries, said James Michael, with the Yakima, Wash.-based Northwest Cherry Growers. Michael said Gen Y and Millennials are emerging as important cherry consumer groups.
Lutz said the crop size last year limited household penetration.
“2010 was bit of an off year due to difficult crop conditions,” Lutz said in an email.
By way of comparison, the 2009 household penetration of cherries was 31.5%, Lutz said. That was due largely to bigger volume and lower prices.
Northwest cherry shippers moved more than 20 million 20-pound boxes in 2009, compared to just over 14 million boxes in 2010.
The shorter crop in 2010 was reflected in higher prices. The average retail price per pound of cherries in 2010 was $3.12, compared with $2.61 per pound in 2009, Lutz said.
Supermarkets generated more dollars from cherry sales in 2010, with total dollars up 1.7%, driven by a 19% increase in the average retail price despite a 15% decline in cherry volume.
Lutz said cherries have a very high transaction size compared with other produce items.
Ranking number one among produce items, the average transaction size for cherries in 2010 was $6.79, up 18% compared with 2009.
As a result, he said performance of cherries can be a huge factor in the overall success of the produce department in June, July and early August.
Northwest cherry shippers are targeting a strong base of consumers, Michael said.
“People from all walks of life buy cherries, but on average it is the more affluent, better educated consumers who buy cherries,” he said.
Nielsen data show that consumers who purchase dark sweet cherries spent an average of $28 more than non-cherry buyers, while consumers who purchased rainier cherries spent an average of $42 per shopping trip than non-cherry customers.
Impulse buys account for 53% of cherry purchases, Michael said.
“Those retailers who promote will draw in those customers looking for cherries,” Michael said. “Consumers buying cherries are the exact consumers that retailers want,” Michael said.
A big part of maximizing retail sales is putting secondary cherry displays throughout the supermarket, Michael said.
“The larger you make the displays, the more impact you have on the consumer,” said Bob Mast, vice president of marketing for Wenatchee-based Columbia Marketing International Inc.
Mast said secondary displays must be carefully watched and product rotated to preserve best quality.
A study of supermarkets who used secondary displays in 2009 revealed that those stores boosted volume of cherries sold by 13.6% and dollars by 22.4% compared to stores with no use of secondary displays.
The displays were effective whether shoppers were looking for a few items or many, Michael said.
“Whether going for milk on the way home or a big shopping trip, it is important to have (cherries) merchandised in good locations,” Michael said.
Nielsen data shows cherries rank No. 1 in generating dollars per square foot in July, he said. What’s more, he said cherries pay big dividends if display space is increased.
“Increasing shelf space doesn’t always mean you will see increased sales volume, but with cherries it does,” Michael said.
Retailers will be able to promote solid volumes of Northwest cherries from mid-June through mid-August, he said.
“Consumers continue to purchase cherries as long as they are still available and give retailers a great dollar return through August,” Michael said.
By region, marketers said the southeast U.S. may be the least developed cherry market.
The Northeast U.S. market is considered the strongest market, while the Midwest and the West also do well, said Bob Mast, vice president of marketing for Wenatchee-based Columbia Marketing International Inc.
Mast said CMI works with retailers in all regions to boost display area and the use of secondary bins.