Study shows NWPB brings significant positive impact to watermelon industry
The National Watermelon Promotion Board has released the findings of a new study, conducted along with research partner Armada Corporate Intelligence Inc., that demonstrates the significant positive impact of the NWPB's activities on the demand for watermelon.
The study also shows that investment in the NWPB's promotional activities results in a strong return on investment of 19:1. Additional findings of the study included the NWPB’s significant impact on the retail and FOB price of watermelon from 2017 to 2021 and its impact on the general economy.
"The NWPB is proud to continue our work in promoting watermelon and supporting the watermelon industry," said Mark Arney, executive director at the NWPB, based in Winter Springs, FL.
The study, which developed a model explaining the retail demand for watermelon, found that the NWPB's promotional activities have a significant positive impact on watermelon demand. Funding the NWPB's activities at actual levels vs. the lowest monthly level experienced results in a 4.5 percent increase in the retail price of watermelon. Furthermore, the price flexibility coefficient for the NWPB's expenditures is 0.031, meaning that a 10 percent increase in expenditures on the NWPB's promotional activities would result in a 0.31 percent increase in retail watermelon price.
Retail revenues rose sharply (31.6 percent) from 2017 to 2021 – the same time span when NWPB expenditures remained steady.
The study also found that the NWPB's promotional activities have a positive impact on farm prices. On average, there is a $0.012 per pound difference in farm price when the NWPB's expenditures are set to their historically lowest level vs. what was experienced using the actual expenditures. This difference resulted in a $225.19 million increase in farm sales, meaning NWPB increases farm price by 3.5 percent.
The study indicates that spending on promotion by the NWPB potentially increased employment in the industry by 4,234 jobs, based on incremental grower income and the median fruit and vegetable worker salary. Using economic multipliers from the USDA Economic Research Service for the melon segment of agricultural output, the total effect of the NWPB's spending likely also increased broader economic output in the nation by $160 million.
"These findings reinforce the importance of our efforts and provide a compelling case for amplified investment in the NWPB's activities," said Christian Murillo of Cactus Melon Distributors in Nogales, AZ, and current president at the NWPB. "The models are certainly worth exploring."
For questions about the study or more information about NWPB’s activities, contact Megan McKenna, senior director of marketing and foodservice at [email protected]. The full report An Economic Analysis of Market Impacts of the National Watermelon Promotion Board: 2017-2021 is available at the Industry section of NWPB’s website.