WATERMELON PRESENTATION A & U Studies (Domestic & Canada) rose research, llc. November, 2006 Study Purpose • Understand the dynamics operating in the watermelon category - among purchasers (respondents who have purchased watermelon in the past 12 months) and non-purchasers. • Update the attitudes and behavioral practices of consumers since the last project was conducted in 2004. • Determine reaction to four new product ideas including - - Watermelon Juice - Watermelon Sorbet - Watermelon Bread - Watermelon Yogurt 2 Methodology Domestic A & U A total of 3,128 telephone interviews were conducted during June - August, 2006, among men and women in the United States, 18 years of age or older, who are the primary grocery shoppers of their household. Within the sample, 2,400 interviews were conducted among watermelon purchasers - - who must have purchased watermelon (in any form) in the past 12 months, and 728 non-purchasers. The watermelon purchasers were equally distributed among 8 regions across the U.S., including California, the West, the Plains states, the South Central, Great Lakes, Mid-South, Southeast and Northeast. Canadian A & U In addition, a total of 253 telephone interviews were conducted during June August, 2006, among men and women in Toronto, Canada, 18 years of age or older, who are the primary grocery shoppers of their household. Within the sample, 200 interviews were conducted among watermelon purchasers - - who must have purchased watermelon (in any form) in the past 12 months, and 53 non3 purchasers. Detailed Findings Fruit Purchased Within the Past 12 Months Household penetration of watermelon continues to grow compared to previous domestic studies. • Domestic purchasing is slightly lower than Toronto this year. 100% 90% 96% 95% 90% 95%92%95% 92% 87% 80% 70% 85% 79% 77% 80% 77% 74% 72%77% 72%70% 66% 62% 60% 50% 42% 37% 36% 33% 40% 30% 20% 10% 0% Bananas Apples Watermelon Domestic 2006 Cantaloupe Toronto 2006 5 2004 Oranges 2002 Honeydew Watermelon Purchasers (By Region) Watermelon purchasing has either increased or remained static in every region of the country (except the South Central and the Plains states) compared to previous years. 90% 80% 80% 80% 70% 65% 84% 77%77% 75%78% 74% 73% 73% 65% 78% 74% 60% 77% 72% 64% 58% 60% 72% 61% 73% 72% 57% 50% 40% 30% 20% 10% 0% California West Plains South Central 2006 Southeast 2004 6 2002 Great Lakes Northeast Mid-South Influence of Children on Watermelon Purchasing Children have a significant impact on watermelon purchasing (both domestically and in Toronto) - - as about four-fifths of the respondents mentioned that their children have at least some influence when shopping. 60% 51% 50% 43% 41% 40% 36% 34% 35% 30% 24% 20% 20% 13% 10% 0% Greatly Influence Purchase Somewhat Influence Purchase Domestic 2006 Toronto 2006 7 Do Not Influence Purchase At All 2004 Preference for Seeded or Seedless Watermelon Seedless watermelon continues to be preferred over watermelon with seeds - - higher than in both the 2004 and 2002 domestic studies. • Consumers in Toronto are even more favorable toward seedless watermelon compared to respondents in the United States. • In addition, the following subgroups also prefer seedless watermelon: • More affluent households ($50,000 or higher) • Younger respondents (less than 46 years old) • College graduates 8 Preference for Seeded or Seedless Watermelon 80% 69% 70% 60% 60% 56% 47% 50% 40% 31% 30% 23% 18% 17% 20% 21% 22% 21% 15% 10% 0% Seedless Seeded Domestic 2006 Toronto 2006 9 No Preference 2004 2002 Preference for Seeded or Seedless Watermelon WATERMELON SEED PREFERENCES BY LOCATION, INCOME AND PRESENCE OF MINOR CHILDREN Age Income Education <46 % 46+ % < $50K % $50K< $75K % I prefer seedless watermelon 65 59 54 61 70 58 64 I prefer watermelon with seeds 16 20 21 18 15 20 16 I have no preference 19 22 25 21 16 22 20 10 $75K+ % < College Grad. % College + % Watermelon Cut by Season Similar to 2004 and 2002, summer is the time watermelon is usually bought - - with the whole variety most popular throughout the year. • Incidence of purchasing watermelon (in any form) is higher in Toronto during the spring, winter and fall seasons. • Sections/slices are just as popular as the whole variety during the winter. 11 Purchase Penetration by Season 99% 99% 99% 99% Summer 61% 72% Spring 59% 64% 39% 52% Fall 43% 36% Domestic - 2006 Toronto - 2006 2004 2002 19% Winter 0% 35% 19% 19% 20% 40% 60% 12 80% 100% Watermelon Cut by Season 39% 57% 59% Whole Watermelon 78% 40% Watermelon Sections/Slices Mini Watermelon 32% 30% 26% 11% 11% 10% 16% Winter Fall Spring Summer 23% Watermelon Cubes 0% 13% 11% 8% 20% 40% 13 60% 80% 100% Most Important Reason for Purchasing Watermelon “Good taste” is the most important reason for buying watermelon Followed by “my family/kids like it”, “it’s healthy/nutritious” and “it’s cool/refreshing/juicy” 14 Most Important Reason for Purchasing Watermelon MOST IMPORTANT REASON FOR PURCHASING WATERMELON Domestic 2006 % Tastes good/I like to eat it 43 My family/kids like it 13 It’s healthy and nutritious 12 It’s cool/refreshing/juicy 11 It’s in season 4 It’s a good snack 4 For a picnic, party or special occasion 3 It looked fresh/appealing 2 It’s a good value 2 It’s fun to eat 2 When there is an advertised or promotional price 1 To use as an ingredient in a recipe 1 15 Influence of Recipes, Carvings and New Ways to Use Watermelon on Purchase Intent In addition, about 3 in 10 of the respondents mentioned that “new recipes” or “ways to use it” would motivate them to use watermelon more often - both domestically and in Toronto - - particularly watermelon purchasers. 16 Influence of Recipes, Carvings and New Ways to Use Watermelon on Purchase Intent INFLUENCE OF RECIPES, CARVINGS, AND NEW WAYS TO USE WATERMELON ON PURCHASE INTENT Domestic 2006 Toronto 2006 Purchasers % NonPurchasers % Yes 27 Possibly/ Not sure No Domestic 2004 Purchasers % Nonpurchasers % 21 42 13 12 60 66 Domestic 2002 Purchasers % Nonpurchasers % Purchasers % Nonpurchasers % 23 32 20 33 23 11 19 14 14 22 17 47 58 54 65 45 60 17 Reasons for Not Purchasing Watermelon The top two reasons for not purchasing watermelon during the winter, spring and fall is “lack of availability” and the fact that some consumers consider it to be a “summer fruit” - - particularly infrequent summer purchasers. 18 Reasons for Not Purchasing Watermelon – By Season 45% 40% 35% 36% 35% 32% 33% 33% 30% 30% 25% 20% 15% 10% 5% 0% Watermelon is a summer fruit Spring It's not available Winter 19 Fall Reasons for Not Purchasing Watermelon – By Season Watermelon is a Summer Fruit 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% 40% 34% 31% 30% Spring Winter Frequent Summer Purchasers 36% 31% Fall Infrequent Summer Purchasers 20 Awareness of Health Benefits (By Purchaser Status) Less than 4 in 10 of the consumers (35%) are aware of watermelon health benefits in both the U.S. and Toronto - - a message which should continue to be reinforced. 45% 40% • Purchasers are more knowledgeable than non-purchasers. 38% 35% 38% 40% 41% 35% 35% 29% 30% 26% 25% 20% 15% 15% 10% 5% 0% Total Purchasers 2006 Domestic 2006 Toronto 21 Non-Purchasers 2004 Awareness of Specific Health Benefits Those aware of watermelon health benefits spontaneously played back that it has “has vitamins (in general)”. • In total (unaided + aided), the majority of the respondents recalled that watermelon is - - “low in fat”, “low in calories”, “high in Vitamin C” and contains “the antioxidant lycopene” - - significantly higher than 2004 domestic findings. 22 Awareness of Specific Health Benefits AWARENESS OF SPECIFIC HEALTH BENEFITS (UNAIDED & TOTAL) Domestic 2006 Toronto 2006 Unaided % Unaided + Aided % Low in fat 7 Low in calories Domestic 2004 Unaided % Unaided + Aided % Unaided % Unaided + Aided % 91 6 82 5 93 13 87 7 82 8 87 High in Vitamin C 18 68 18 63 14 67 Red watermelon contains the antioxidant lycopene 10 57 3 36 4 46 High in Vitamin A 5 47 2 48 3 45 High in Vitamin B-6 2 34 - 31 1 27 Has vitamins 28 28 26 26 31 31 Contains vitamins & minerals (net) 15 15 15 15 19 50 Contains water/High water content 14 14 23 23 28 28 Good for you/Healthy 7 7 10 10 12 12 23 Awareness of Watermelon Health Benefits and Purchase Intent Moreover, and an indication of the importance of “watermelon health benefits”, the vast majority of the respondents (who are aware of watermelon health benefits) would buy watermelon because “it’s good for them”. 90% 80% 77% 83% 78% 70% 60% 50% 40% 30% 23% 17% 20% 10% 0% Yes 24 Domestic 2006 Toronto 2006 No/Don't know 2004 21% Awareness of Heart-Healthy Benefits of Watermelon and Purchase Intent Knowing that watermelon is “good for your heart” is even more impactful, as 81% of the respondents indicated that they would be more apt to buy it if they had this information. 81% 19% Yes No/Don't know 25 New Watermelon Product Ideas Top 2-Box Purchase Interest in New Watermelon Products (Definitely/Probably Would Buy) Purchase interest of watermelon juice, watermelon sorbet and watermelon yogurt all surpassed our purchase interest target of 50% in Toronto, while falling short in the U.S. • However, interest in watermelon bread was low in both Toronto and the U.S. 70% 50% 40% 59% 57% 60% 43% 59% 44% 37% 31% Domestic - 2006 Toronto - 2006 30% 21% 20% 10% 0% Watermelon Juice Watermelon Sorbet Watermelon Yogurt 27 Watermelon Bread Recommendations Recommendations The National Watermelon Promotion Board should continue to stress its health strategy to consumers - - especially the heart healthy messages recently approved by the USDA. In addition, the NWPB should consider positioning watermelon as a “year round fruit the whole family can enjoy” in order to increase consumption during the spring, fall and winter. 29 Recommendations We would also recommend that the NWPB commission a study to further investigate the attitudes and behavioral practices of infrequent versus frequent summer purchasers as a means of determining how to increase consumption. Finally, the NWPB should consider conducting a nationwide study in Canada in order to accurately measure consumer attitudes and behavioral practices toward watermelon across the various provinces. 30