Sunkist has a new product line, and it may be a big win for the whole produce industry:
SUNKIST INTRODUCES
NEW REFRIGERATED JARRED FRUIT LINE
Category Growth Expected From Second Entry
Sunkist Growers and Old World Enterprise Group, LLC are launching a new line of chilled jarred fruit in August. Sunkist Premium Sweet debuts in eight varieties of fruit, including a new and exclusive Valencia Orange. Picked at the peak of freshness, Sunkist Premium Sweet jarred fruit is packed in 100% juice, so the product is fresh tasting and delicious.
Sunkist Premium Sweet jarred fruit is being manufactured by the “Better for You” Food Division of the Old World Enterprise Group under license from Sunkist Growers and will be sold exclusively in chilled cases in the produce section of grocery, convenience and club stores. Sales of the new product line will be managed by the Sunkist fresh produce sales organization. The entire line will be refrigerated all the way to the grocer’s produce section to ensure the highest level of freshness and taste. Sunkist is the leader in fresh citrus, and it is a natural partnership to complement its fresh line with a packaged line of fruit for added convenience.
“We expect to increase category penetration by offering consumer television advertising, along with retail promotions, couponing and cross promotion with other Sunkist products,” noted Richard Sanderson, President of Old World Enterprise Group.
“The new Sunkist line offers consumers a better-for-you product, with more natural taste. Our new Sunkist Premium Sweet is an excellent source of Vitamin C and antioxidants from Vitamin C,” noted Mr. Sanderson. “And the convenience of both 8 ounce cups and 24 ounce jars makes it easy for consumers to feel good about eating healthy.”
Both companies emphasized their desire to introduce a product with superior consumer preference and are pleased that the new line tested so well with consumers. In concept testing, consumers played back attributes and strength of the Sunkist brand as being known for “freshness,” “citrus,” and “health.” In addition there was strong appeal to the “natural, packed in juice” formula and for the clear packaging, which was preferred by consumers who compared it with competition, and reported that the new Sunkist packaging was “higher quality,” “shows more of the real fruit,” and “looks like a premium product.” Product testing was done on a “blind” and “identified” basis, resulting in consumer preference for all the fruit types being offered.
Category research and Usage and Attitude studies reveal that consumers use refrigerated jarred fruit for snacks through the day and at every meal. They are primarily purchased by adult female homemakers, aged 35+. “This is truly an all-day, 24-hour, great tasting snack and complement to any meal, providing families with one of the essentials to everyday nutrition,” said Sanderson. “It’s a perfect fit with consumer life today and the want for fresher, healthy options.”
John McGuigan, vice president of Sunkist sales, noted, “We expect that our entry will have a stimulating effect on the category, with overall sales growing as a result of giving consumers a choice. We plan to deliver category-management leadership to our trade partners by expanding the category with this exciting new product line.”
IRI (Information Resources, Inc.) indicates annual sales of the refrigerated fruit category are approximately $84MM (not including Wal-Mart, club store, convenience stores, or other non-grocery outlets.) Of significance, the 8-ounce cup segment is growing at double-digit levels. “Based on our research, we believe the category will grow in total a minimum of 15%,” said Sanderson.
The big player in this arena, of course, is Del Monte, but it is not Fresh Del Monte Produce… it is Del Monte Foods that sells the Fruit Naturals, Orchard Select and SunFresh brands of jarred fruit.
In most cases, companies that earn most of their income outside of fresh produce are not as supportive of industry institutions as Sunkist would be. So if Sunkist takes some market share, it might mean more support for food safety and other industry initiatives and organizations.
Of course, competition is typically good for a category and Sunkist is promoting that it expects the category to grow as a result of a second entry.
Perhaps the second time will be a charm. Sunkist did enter the business once before. Toward the end of 2005, it was announced that Sunkist signed a multi-year licensing agreement with Freeman Foods LLC to launch a similar line of glass jars and single-serve plastic cups under the Sunkist brand.
Last time the licensee was being headed up by Randall Freeman, who had run the jarred fruit business for Del Monte Foods. Freeman was to handle all sales and marketing logistics for the product, which was supposed to begin national distribution in January 2006.
It is not clear what happened to that venture, but this time there seems to be two very strong reasons to think Sunkist may be successful. First, its licensee this time around is a much more substantial organization. Last time Freeman Foods was a start-up, and it was literally posting on the Internet looking for co-packers. This time the licensee is a subsidiary of Old World Industries, which includes a chemical division, a runway de-icing agent division and a consumer products division, including Bare Fruit organic bake-dried fruit.
Also, this time, the actual selling of the product will be handled by Sunkist’s fresh fruit sales force headed up by John McGuigan, Vice President of Fresh Fruit Sales. Sunkist certainly has the connections to make things happen — although typically the citrus buyer at a chain store doesn’t buy the jarred fruit.
Competition here will probably be good for consumers as well, as many retailers have used jarred fruit as a margin-enhancer and have not worked closely on it. Some competition in the category might lead retailers to compete with the item.
The release mentions television ads, couponing and whatnot. If done a sufficient scale, it might draw consumers to the produce department.
Sunkist and Old World were kind enough to send the Pundit a sample, and we can report that both the “Valencia Oranges” and “Petite Peaches” tasted terrific and that both the 1lb-8oz glass jar and ½ cup plastic cup were attractive.
The peaches came from China and the Valencias from Mexico. It was unclear where the product was packed.
We would like all manufacturers to be more specific on their refrigeration warnings. The product clearly says “MUST BE REFRIGERATED” but, as is typical, it gives no specific temperature range and doesn’t state the consequences of not refrigerating.
Is it just a matter that the product will go rotten? Or, as with the carrot juice last fall, is it a food safety issue? And how long is it OK to not be refrigerated? Can you throw a cup in a kid’s lunch box for the child to eat in three hours?
The industry is selling more and more refrigerated packaged product. Jarred fruit, juices, salad dressing, etc. We really need to make sure consumers know what we are asking them to do.
Sunkist has had a tough year. This product should deliver millions of consumer impressions for the brand and give the salespeople another product to sell, while injecting a healthy dose of competition into a growing category. We wish Sunkist well.
