With millions of boxes hitting the market in the next five years, the marketing campaign for Washington’s exclusive Cosmic Crisp variety is quickly ramping up. (Courtesy Proprietary Variety Management)
Washington State University and the company contracted to launch its new WA 38 apple variety, to be sold under the brand name Cosmic Crisp, are teaming up on a $10.7 million, five-year marketing campaign intended to build excitement and generate consumer interest in the new apple in advance of its retail release.
The variety is exclusive to Washington growers in the United States for at least 10 years, but the stakeholders in this venture are many, from university researchers to growers, packers and sales companies, and to retailers and consumers. And the stakes are high — no more so than for the growers who face the highest financial risk on an untried variety.
So far, Washington growers have already planted 6.7 million trees since 2017. Only 176,000 42-pound boxes of fruit are expected next year, the first year that fruit will be available commercially, but the volume increases steadily in the ensuing years:
—1.7 million boxes in 2020.
—5.5 million in 2021.
—10.5 million in 2022.
“It continues to go up very fast, and hence the need for the launch,” said Lynnell Brandt, president of Proprietary Variety Management, which has been hired by WSU to oversee the commercial rollout of Cosmic Crisp.
Brandt said industry estimates peg overall grower investment in the new variety at $500 million in just the first two years. This consumer-facing marketing campaign comes on top of the industry’s anticipated campaign aimed at retailers. “We’re working to try to enhance the value of the product, which in turn returns more money to all of the stakeholders,” he said. “We don’t want to start out and suddenly go to a commodity situation. We want to come out of the gates very, very strong.”
Over the past few months, PVM developed the framework of a marketing plan and presented it to a marketing committee of Washington apple packers and marketers with a stake in the apple’s success, as well as university leaders, who also presented the plan to the university’s licensing committee. All provided input and signed off on it, and university regents were expected to approve it at their mid-November meeting (after Good Fruit Grower’s press deadline), WSU business development specialist, Albert Tsui, said.
WSU and PVM declined to provide a breakdown of the budget, but Tsui said PVM would be putting up a substantial portion of the $10.7 million in the later years of the plan. Money for the plan is coming from collective royalties, roughly $4 million of which has already been collected on tree sales, he said.
“We’re very comfortable with the marketing plan that’s being rolled out and the oversight of the industry,” he said. “We could just take that money and say, ‘It’s all going to the breeding program and you guys are on your own,’ but we’re actually taking that $4 million and investing in this marketing program to ensure success for everyone.”
Tsui also noted the industry’s marketing committee for Cosmic Crisp has created a third-party review subcommittee to provide input to PVM going forward, with members being rotated so that a wide spectrum of the industry is represented and provides external input.
“PVM has some latitude on the direction the campaign should go. They have discretion to move forward, but it really is a check and balance and is something that makes sense for the industry,” he said.
So far, though, there’s been widespread support from the industry. “In the past two months, we’ve worked to get that feedback, and if we had heard major kicking and screaming or major objections, we would have responded, but we haven’t heard that,” he said. “We’re just working as hard as necessary to get the best price as the fruit is coming to market.”
Brandt said he doesn’t yet have a sense for where that price needs to fall. “The new planting techniques that everyone is employing are quite expensive for implementation, not just for Cosmic but for everything,” he said. But the good news, he said, is that “Cosmic doesn’t appear at this time to be a high-maintenance variety like Honeycrisp.”
One of a kind?
WSU bred the WA 38 apple from a cross of Enterprise and Honeycrisp and, after years of orchard trials, hired PVM to oversee the patent, licensing, propagation and tree sales, branding and marketing. Any Washington packer and marketer can be licensed to pack and sell Cosmic Crisp apples; licensed Washington growers must send their Cosmic Crisp apples to a licensed packer, and licensed packers must sell their apples to a licensed marketer.
A ramp-up in production of a new produce variety hasn’t been seen on this scale before, said Kathryn Grandy, PVM director of marketing and operations.
“Traditionally, you do not see this level of expenditure on an apple launch,” she said. “We’ve already been telling our story and are hoping to generate better pricing down the road, and a lot of earned media.”
Already, print and online media companies are biting on the story, from the New York Times to National Public Radio. Grandy said PVM is partnering and working with experienced marketing and advertising companies on the campaign that includes consumer research, traditional and new media, and the possibility of employing some new technologies, such as photo recognition on packaging.
“Different companies are looking into mobile technologies. We feel it helps bridge consumers through packaging and to retail. We’re investigating it, we’re still examining it, but we’re very committed and know that’s an important avenue to address in our marketing plan,” she said.
Playing to consumer health is another angle, she said.
“We wanted to do something that was very authentic and really focused on consumer health in a very positive way, with a plan that would get the apple into the hands of as many consumers as possible,” Grandy said. “We’re comfortable that we’ve come up with some fantastic ideas that are very consumer facing.”
Ultimately, sales companies have to get the apple to retailers, Brandt said, but consumers have to demand the product. “We believe we have to get in front of this to maintain the best value profile that we can, right from the beginning,” he said. “And we believe that has to be with the consumer.” •
-by Shannon Dininny
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