Reclaiming Hawaii’s Avocado Market through Branding of Hawaii County Avocados
By Dr Catherine Chan-Halbrendt, Jyotsna Krishnakumar, Quanguo Andy Zhang (CTAHRNREM) Ken Love – Hawaii Tropical Fruit Growers
One-third of Hawaii’s total demand for avocados are imported. In 2007, the avocado
production in Hawaii was about 1.160 million lbs with the deficit of 2.3 million pounds being
met by imports (NASS 2008). Considering the higher prices received by imported avocados,
which are almost three to four times the price of local avocados (Chan-Halbrendt et al. 2007),
clearly there is a great potential for import substitution by the local avocado industry. Hawaii’s
avocado industry has the ability of supplying different cultivars of avocados, versus the single
imported variety Hass. According to a study on Hawaii’s avocado industry by Bittenbender,
Kefford and Rohrbach (1989), lack of coordination and marketing information to the industry is
severely hindering its expansion to meet growing demand. Coordinated marketing strategies to
promote local avocados, such as labeling and consumer-awareness, is clearly indicated. This
project evaluated the effects of labeling of locally grown avocados comparing them with imports.
Stickers with “Hawaii Grown Avocados” along with the individual variety name will be
designed and used.
Sticker distribution and placement on correct varieties was monitored as well as buyer
preferences. The purchase activities of buyers were monitored by simulating retail buying
situations at food stores and/or farmers’ markets and buyers who purchased the avocados were
asked to fill in a questionnaire regarding their purchase choices and decision-making.
The project foresees a greater sustainability for Hawaii avocado growers through labeling of
local avocados as a key outcome.
Buyers who purchased avocados were asked to fill questionnaire regarding their purchase
choice circumstance and decision-making. Available choices were unlabeled local avocados,
labeled imported avocados, and labeled local avocados.
To simulate a real market situation by providing avocado purchase options to the buyers, the
price of the avocados had to be determined. Market prices for local and imported avocados were
observed for a week (around September 20th to 26th, 2009) and the average price was calculated.
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Once the average price per piece of local avocados was obtained, the price for previously nonexistent labeled local avocados) was estimated. This included the certification cost, label cost
and labor cost. It was estimated to be 10 cents more than the unlabeled local avocado. With the
prices estimated and observed and the labels created, the following three choice options of
avocados were provided to buyers/respondents to choose from: Choice 1. Local unlabeled
avocados priced at $2.09 each; Choice 2. Local labeled avocados priced at $2.19 each and;
Choice 3. Imported avocados priced at $2.49 each. Their choices were observed and noted after
each respondent’s decision when they were then asked to participate in a survey.
Data was collected from the respondents on purchasing behavior, preferences for avocado
product attributes, socio-demographic and other variables that influence the consumers’ choice
of avocados. 495 respondents were interviewed face to face in Kona and Honolulu for this study.
The socio-demographic profiles of the study population from the data collected matched well
with the Hawaii population socio-demographic profiles except for 2 categories. There were more
female respondents and educated respondents.
2a. Results of the Descriptive Statistics
Respondents’ Preferences for Avocado Choices
In the current market situation, the local avocado industry shares only one third of the local
avocado market (NASS 2008). The study results showed that 80% of the respondents chose local
avocado with 47% chose the labeled option and 33% chose the unlabeled option (Figure 1). It is
also important to note that 81.03% of the respondents read labels when they buy fruits. This is
consistent with previous studies that have indicated that buyers prefer information to be provided
through label (e.g. Country of Origin) (Puduri et al. 2006).The results also indicate that majority
respondents chose local avocados and majority respondents also pay attention to labels when
they buy fruits. Preference for labels is an important attribute as studies have indicated that
product labeling can increase the buyers’ willingness to pay for the product (Mabisco et al. 2007).
Figure 1: Percentage of Respondents’ Preferences for Avocado Choices
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46.46%
21.01%
32.53%
Choice 1: Labeled Local Avocado, $2.19 Each
Choice 2: Unlabeled Local Avocado, $2.09 Each
Choice 3: Imported Avocado, $2.49 Each
Figure 2: Percentage of Respondents’ Preferences of Avocado Attributes
a. Respondents' Preferences
Toward Avocado Size
b. Respondents' Preferences
Toward Avocado Colour
32.19%
21.18%
c. Respondents' Preference
Toward Avocado Shape
3.44%
8.70%
26.52%
73.93%
30.97%
4.89%
Large
Medium
Small
60.53%
Black
28.14%
Green
Round
Pear
Others
Do not Care
Others
Do not Care
9.51%
Figure 3: Percentage of Respondents’ Avocado Purchase Behavior
a. Respondents' Purchase
History of Avocados
b. Respondents' Purchase
Frequency of Avocado
10.80%
22.73%
c.Respondents' Purchase
Quantity of Avocados
32.70%
7.07%
10.40%
82.54%
Under 2 Years
More than 4 Years
3-4 Years
40%
Once a Week
Every Month
18.18%
Every Two Weeks
Occasionlly
57.86%
9.43%
1-2 Pieces
Over 4 Pieces
3-4 Pieces

Those respondents who ‘prefer labels’ are less likely to choose unlabeled local avocados.

In terms of being ‘price conscious’, there is also no significant correlation between
respondents who are ‘price conscious’ and her/his choice of local avocados.
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
The larger the size of avocados that buyers prefer, the more likely they are to buy
unlabeled local avocados.

There is no significant correlation between quantity of avocados bought at each purchase
by a respondent and his or her choice of unlabeled local avocados compared to labeled
local avocados.

Considering socio-demographic variables, as age of the respondents increase they are
more likely to buy unlabeled local avocados compared to labeled local avocados.

Those with full time employment are less likely to buy unlabeled local avocados
compared to labeled local avocados.

Gender, yearly household income, location and residency did not have any significant
influence.

Those who ‘prefer labels’ are significantly less likely to choose imported labeled
avocados.

Those who are ‘price conscious’ are significantly less likely to choose imported avocados
compared to labeled local avocados.

The larger the size of avocados the less likely they are to buy imported avocados
compared to labeled local avocados.

Those who buy more quantities of avocados at a time are significantly more likely to buy
imported avocados.

Considering socio-demographic variables, results indicate that females are less likely to
choose imported labeled avocados compared to labeled local avocados.

Those who are residents of Hawai‘i are less likely to choose imported labeled avocados
compared to labeled local avocados.

As respondents’ age increases they are less likely to choose imported avocados compared
to labeled local avocados, controlling for other variables.

Those who are from Honolulu are less likely to choose imported avocados compared to
labeled local avocados, controlling for other variables.

Annual household income and fulltime employment did not have any significant
influence.
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The goal of this project is to eventually increase the market share of local avocados to
replace imports. We hypothesized that through branding, increased awareness of locally grown
avocados will lead to greater sales that will be able to replace much of the current imports over
the coming years and meet increasing demand with local avocados. The results indicate that
more consumers choose labeled local avocados and indicate that there is a preference towards
labeled local avocados compared to imported avocados. From these results we can predict that
local avocado industry has the potential to substitute imported avocados and increase their
market share. Also, there is a specific segment among the population who care about labels,
show a preference for local labeled avocados over unlabeled local avocados and price is not
important to them. Local avocados can be a major player in developing high-value products due
to the advantages of “ Made/Grown in Hawaii” brand identity which is a mark of excellence and
quality that people all over the world seek out. According to literature survey, there is a change
in trend among food consumers showing keen interest in knowing the origin of food with a
preference for locally grown food. This is also obvious in the case of local avocados based on the
results of the study. Therefore it is imperative that this potential be tapped. Many states in the
United States including Hawaii, have used promotional campaigns for local agricultural fresh
and processed food to influence consumer purchase. Hawai‘i’s “Buy Fresh Buy Local” campaign
is likely to have played a key role in influencing preferences of local fresh food shoppers. This
needs to be pushed further by introducing effective marketing strategies such as labeling.
It was also predicted that labeling of local avocados will not only enhance its local
market share but also benefit the future exports potential to the mainland and other regions.
Considering the future exports potential, the origin and cultivar is the basic information that is
needed to be provided to consumers, and label could be the best approach to provide this
information. It is believed that Hawaii avocado growers can reach the potential exports market
with the right support.
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