AFM continues to strengthen fall sales
Building on efforts begun several years ago, Avocados from Mexico is continuing to develop promotions to build up sales during the first half of its July to June fiscal year.
“Now is the time for Mexico,” said Alvaro Luque, president and CEO of the U.S.-based promotional arm of the Mexico avocado industry.
Speaking to The Produce News in October, Luque said that AFM originally concentrated its efforts on the second half of the year — beginning in January — and didn’t develop the first half of the season. That was a good strategy as avocado sales in the United States doubled over the last seven years. In those years, the focus was on the four major second half consumption occasions: Super Bowl, March Madness, Cinco de Mayo and Fourth of July.
The promotion organization started talking about changing the dynamic in 2017 and launched new promotion programs in 2018. Luque said it has been a big success.
AFM has several promotional efforts that are contributing to this success. It has significantly improved the use of point-of-sale material during the fall period. Last year, 54,000 stores ordered POS material. This year that number has grown to 70,000 stores, which is about a 30 percent increase.
This season, the group’s national fall promotion is built around football tailgating parties. Luque noted that there are about 600 opportunities during the period for fans to tailgate. “Football and guacamole go together well,” he said.
AFM has designed a contest in which it will give away 10 tailgate trucks completely equipped with everything needed to throw a lavish tailgate party. The promotion is utilizing in store displays with QR codes as well a digital media.
Also new this year has been a “full brand refresh, with a new look and feel,” according to Luque. The AFM logo has been updated with a new tagline associating Mexico avocado consumption with “good moments.”
While Mexico dominates the market during the fall and is the supply leader for basically the entire year on a weekly basis, Luque still believes it’s important to create the brand identity and the connection with the point of origin. He said several years of successful promotions have raised brand recognition from 2-3 percent of consumers to 16-17 percent. He agreed this brand recognition will become even more important down the road as Mexico increases its volume, but its market share declines, simply because more suppliers enter the marketplace to fill the demand.
Luque noted that market expansion rather than domination has always been the goal of AFM. He welcomes the day that increased volume from Peru and Colombia and other countries help fill the growing demand that AFM has had a huge role in creating.
While the first half of the year is a very important switch in focus to help Mexican producer front load sales, AFM is not abandoning its efforts from January on. In late October, its program surrounding the Super Bowl, or Big Game as promotional partners are schooled to call it, were still being developed. AFM has partnered with former star quarterback Drew Brees, who will be the avocado spokesperson for promotions leading up to the NFL championship game. The consumer-facing promotion will include a giveaway of a $100,000 home improvement package.
Luque revealed that during the Big Game weekend and the run up to it, a load of avocados from Mexico come into the United States every six minutes to fill the growing appetite of American consumers.
Speaking to the continued growth in demand in the U.S. market for avocados, Luque said it is hard to find a food that has what he calls the “triangle of power” concerning U.S. eating habits. An avocado, he said, offers “good health, good taste and good times.” While other foods might offer two of the three, very few can provide all three of these consumption drivers.
He noted that while avocados have been a trendy item, there is still lots of room for growth. Luque said 40 percent of U.S. consumption comes largely from the Hispanic demographic, which grew up on the fruit and has a life long love affair with it. But the other 60 percent is consumed by the remainder of the U.S. market.
Since its inception, AFM, and other avocado marketers, have focused most of their promotional efforts toward medium, heavy and super users. While avocados are a trendy item, there is still about 40 percent of the U.S, population that are non-users. Luque said it is still easier and more efficient to increase the consumption of users than go after the non-user category.
As time goes on, he said the non-user category may merit more consideration but currently the economics dictate concentrating promotion funds on those with some predisposition to buy the green fruit.
Foodservice is another complicated issue facing marketers. Luque said foodservice sales, which were severely impacted by the coronavirus and restrictions around the pandemic, have not fully come back yet. Foodservice operators are plagued with labor and transportation issues, and ever-increasing costs, which have made it more difficult for this sector to focus on promotions that could drive sales. AFM is attempting to combat this inaction by developing turnkey foodservice promotions that make it easier for foodservice operators to participate.
Interestingly, the coronavirus has also knocked out sampling efforts at retail, but Luque doesn’t lament that. He said the elimination of sampling has forced the group to think outside the box and develop other traffic-building promotions. AFM is building more custom programs working with retailers on a one-to-one basis to understand their needs and build a program to address those needs.
“It’s expensive but it works,” he said.