KANSAS CITY - In the COVID era, shoppers are stocking up when they go to the grocery store. They’re also looking for foods with health benefits that could help them stave off illness in general. And, increasingly, they still want “fresh.”
Fresh citrus — hardy and full of Vitamin C — checks all three boxes. And California citrus shippers and industry officials said there will be plenty of fruit in a wide selection of varieties this season to meet that surging demand.
Los Angeles-based The Wonderful Co. began shipping its Halos brand California mandarins in November. Wonderful will support Halos sales this season with a targeted multi-million dollar marketing campaign, including a social media campaign, instore POS displays, and a new collection of colorful stickers, said Adam Cooper, the company’s senior vice president of marketing.
Wonderful will also continue its “Grove of Goodness” display program for a fourth year. The program features eye-catching Halos Grove Tree and Fruit Stand displays that drive velocities 18% faster than product featured without a display, Cooper said.
Even without those marketing boosts, Wonderful expects strong movement thanks to COVID.
“As people are eating at home more often and also looking for functional benefits from their food, we expect increased demand for Halos as they’re the perfect healthy snack for both kids and adults and also an excellent source of vitamin C,” Cooper said. “One serving of Halos — two medium mandarins — contains 50% of the recommended daily value of vitamin C.”
Old favorites new varietals
Valencia, Calif.-based Sunkist Growers began shipping navels and Sunkist Delite branded mandarins in November. Cara Cara navels and blood oranges were expected to follow in December. Easy-to-peel and super-sweet Gold Nuggets are set for their usual February release. Sunkist ships lemons and grapefruit all year long.
Christina Ward, Sunkist’s director of communications, said the cooperative would also have a full lineup of specialty varieties this season, including sweet-tart pummelos, Texas Rio Star grapefruit, Minneola tangelos, royal mandarin and Fairchild and Ojai pixie tangerines. Sunkist also offers a full lineup of organic citrus.
Ward expects continued high demand as the California citrus deals kick in. And fortunately, there should be enough from the Golden State to meet it.
“As consumers continue to cook at home more, it’s translating into strong sales at retail,” she said. “We’re looking at a large crop volume to meet the increased consumer demand for all things vitamin C.”
With nearly half of consumers eating over 90% of their meals at home, cooking fatigue becomes a significant factor in consumers looking for healthy products and new recipe inspiration online, Ward added. Lemon sales have seen a 31% increase at retail versus a year ago, and Sunkist is expanding its nutrition education program to inspire consumers with accessible, at-home recipe ideas through dishes, drinks, and décor to drive consumption.
According to IRI data, the citrus category across all varieties has seen steady demand increases, with a 20% growth versus a year ago. Nationwide, orange sales have seen a 37% increase; lemons have seen a 19% growth, and grapefruit is seeing a 12% increase versus a year ago.
Consumers also continue to be focused on the health benefits and “shelf-ability” of the foods they’re buying, Ward said.
Online sales: the brand advantage
Wonderful anticipates a continuation of the consumer purchasing patterns established during the first months of the pandemic, with basket sizes larger as people continue eat more meals and snacks at home.
Another COVID-related impact that helps well-known brands like Halos is the increase in digital grocery sales, Cooper said.
“Online grocery is growing at a record pace, meaning branded produce will become even more sought after as consumers shop online for quality citrus products they can count on,” he said. “Consumers know that when they purchase Halos online, they’ll receive the highest quality product.”
Wonderful’s quality standard for Halos has strict taste and quality specifications that lead to customers rating Halos 18% higher overall than generic brands on Amazon, Cooper added. The company expects to continue seeing an uptick in ecommerce as more retailers and grocery stores incorporate drive-up and order-ahead offerings.
The pandemic is also affecting pack sizes for California citrus. Tough economic times affect shoppers differently, Cooper said. Some consumers are looking for more value-sized packaging at a lower cost per ounce, while others are looking for smaller and more affordable package sizes.
“Because mandarins are consumed on various occasions by various consumer groups, we know a multi-sized packaging approach works best,” he said.
Halos are sold in 3- and 5-pound bags and 5-pound boxes at retail. A family-sized value pack is perfect for families, Cooper said, while smaller sizes are key to reaching new consumers and getting trial and repeat purchases.
Retailers are continuing to leverage Wonderful’s eye-catching branded packaging and high-graphic instore point-of-sale (POS) displays, including bin bases, posters, and balloons to drive impulse citrus purchases, he added.
Displaying POS in secondary locations beyond the produce aisle, including at checkout and lobby entrances, can help retailers maximize visibility and attract shoppers’ attention.
“Citrus is versatile, and great for all kinds of creative cross-promotions with other complementary items in and outside of the produce department,” Cooper added. “Looking ahead, retailers can utilize custom targeted promotions using retailer loyalty card data, physical and digital couponing, social media, and influencers to drive awareness throughout the citrus season.”
A return to normal
Casey Creamer, president of Exeter-based California Citrus Mutual, said Golden State citrus growers are looking forward to an average-sized crop with good quality and sizing.
“Average,” in this context, is good.
“The ’17-18 crop was lighter, ’18-19 was big, last year was average, and this year should be average — kind of right in the sweet spot,” Creamer said. “There should be good demand, and the quality and sizes consumers are looking for.”
With a heavier crop, sizes are often too small; with a lighter crop, just the opposite, Creamer added.
By variety, mandarin volumes should be up from last season, Creamer said, but steadily increasing demand should mean they will move through markets with no trouble. Navels should be similar to last year. Grapefruit volumes also should be similar to last year, when volumes were slightly below historical norms.
In the COVID era, demand for citrus has been strong because of the health benefits associated with Vitamin C, Creamer said.
“It’s really changing consumer buying habits,” he said. “People are looking to keep their immune systems as well off as possible.”
COVID has put a big dent in demand for California’s choice grade lemons, which typically ship to restaurants and other foodservice channels. But Creamer said fancy grade lemon sales have been very strong because of demand for fresh foods consumers think can make them healthier.
The pandemic has also steered significant volumes of California fruit into the US Department of Agriculture’s food box program, via the Coronavirus Aid, Relief, and Economic Stability (CARES) Act.
COVID has also changed how California citrus is marketed at retail. People are making fewer trips to the store, and when they do, they’re stocking up. Fortunately for California citrus growers, that plays right to their strengths.
“Oranges are a good, hardy fruit that store well,” Creamer said. “When it comes to fresh produce, shoppers have the same mentality as in center-store: what’s going to last me?”
That means more sales of bagged product, with 3- and 5-pounders popular for mandarins, and even some 8-pounders popping up. Navels often come in even bigger packs, including boxes from retailers like Costco.
Creamer expects increased demand for California fruit from China this year, thanks to lower tariffs. For the bulk of the ’19-20 season, the US slapped a 70% tariff on fruit shipped to China, thanks to ongoing trade problems between the two countries. By spring, however, that tariff had been lowered to 35%, and since then movement has been steadier. Creamer expects that to continue.
“We’re seeing more of a return to where we’ve historically been with China,” he said. “And our other Asian export markets are good, potentially improved.”
Despite that demand from Asia, California citrus growers still expect to have enough fruit to meet COVID era demand.
“Our growers have had a difficult couple of years. They’re excited about the upcoming season.”
California wrapped up its 2020 Valencia season in September, with new-crop navels, mandarins, grapefruit and lemons kicking off in mid-October and expected to begin shipping in promotable volumes by mid-November, with volumes expected to peak through February.
This story was featured in the November issue of Supermarket Perimeter. Click here for the full issue.
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