A New Commercialization Strategy Aims To Pull New Varieties Through The Value Chain, Not Push Them.
Proprietary Variety Management, a new company helping to commercialize two new red-fleshed apple varieties developed by Bill Howell of Prosser, Washington, is using a different strategy from how varieties have been introduced in the past.
The company’s general manager John Reeves said the value chain starts with the breeder, goes through the nursery, grower, packer, and marketer, and finally reaches the consumer. Everyone has an investment in a new variety, but the breeder and the grower are by far the most heavily invested.
In the past, if a breeder found an interesting variety, he or she would take it to a couple of nurseries for testing, and if they liked it, they would ask a grower/packer to take a look at it, and so on.
“It’s being pushed all the way up the ladder,” Reeves said. “What we want to do is help commercialize varieties by creating a pull through the system instead of pushing them through the system. We want to change the paradigm so we’re working in a manner where consumers have more say in what goes on.
“When you think about it,” he added, “the only real new money that comes into the system is from the consumer, and yet we spend the least amount of time working with the consumer on the development of new varieties.”
Reeves, who has worked for several major food companies in the past, said they involve consumers in the development of their products.
“They don’t just make one and throw it out there and see if it works. That’s too risky and expensive.”
Reeves said PVM will conduct consumer focus groups as it develops a brand name for the apples to ensure that consumers have an emotional attachment. When they are emotionally attached to a product, the marketing becomes less commodity-driven.
“What we want to find out is what might be the emotional button,” he said. “Then you can focus your marketing on that.”
Proprietary Variety Management will also do consumer research to identify target consumers.
Initially, just two growing and marketing companies, Chelan Fresh of Chelan, Washington, and Stemilt Growers, Inc., of Wenatchee, Washington, have been licensed to grow and sell the red-fleshed varieties, but it won’t be a club system with restricted production. If the varieties are successful, it will take more than the two companies to meet the demand, Reeves believes.
“We do not believe in club varieties,” he stressed. “Our mission is to make sure we take care of the breeder—we’re doing the commercialization for them. What we want to do then is get a very focused marketing campaign working with a few people, and then open it up.”
The two initial partners will be given time to recoup their investment. Then the system will operate somewhat like Pink Lady, where anyone can grow the variety as long as they sign a contract and follow certain rules.
“Our whole goal is to develop the most value in that entire value chain,” Reeves said.
Stemilt Growers, on its part, is not limiting itself to Howell’s varieties. The company has been testing other red-fleshed varieties developed by Markus Kobelt of Lubera nursery in Switzerland.
Stemilt is also part of the Next Big Thing cooperative based in Minnesota, which has joined a European consortium IFORED.
The consortium was established in 2012 to test, select, and commercialize red-fleshed apples developed by International Fruit Obtention with the goal of bringing them to market within five years. Next Big Thing members planted the first of several red-fleshed apple selections this spring.
Roger Pepperl, Stemilt’s marketing director, said the company is still a long way from commercializing a red-fleshed variety. He thinks the concept shows promise but the novelty of the red flesh is not enough.
“If there’s one thing we’ve learned in the produce business, it’s that it’s got to be good to be sustainable.”
Pepperl said red-fleshed varieties have three potential differentiating qualities: red flesh, a unique flavor, and enhanced nutrient content resulting from the antioxidants (anthocyanins) in the red flesh, but they must also give consumers a good eating experience.
Because of their heritage, red-fleshed apples tend to have high acid levels, but high acids can be a positive attribute as long as they’re balanced with high sugars.
“I like that I get hit on both sides of my palate,” Pepperl said, referring to apples such as Piñata that have a sweet tangy flavor. In contrast, Fuji is a sweet apple that has low acids and lacks a lingering taste.
“I like Fuji,” he said, “but after I eat it, 15 minutes later I forget I ate it.”
Article by Geraldine Warner, Good Fruit Grower