"Arizona Grown", by Paul M. Patterson, Ph.D., Hans Olofsson, Timothy J. Richards, Ph.D. and Sharon SassTopic : Arizona promotional programs of agricultural products
"Arizona Grown", by Paul M. Patterson, Ph.D., Hans Olofsson, Timothy J. Richards, Ph.D. and Sharon Sass
Topic : Arizona promotional programs of agricultural products
"Market Watch.....Watermelon", by Richard Adu-Asamoah, Ph.D.
Topic : The 1997 Watermelon Market
by Paul M. Patterson, Ph.D., Hans Olofsson, Timothy J. Richards, Ph.D. and Sharon Sass
As many as 23 states operate programs which seek to promote their state grown agricultural products. These types of programs typically rely on funding from state appropriations and private sector contributions and are often administered by state departments of agriculture. Their promotion efforts generally include point of purchase (POP) materials, media advertising, and public relations marketing activities. Probably the oldest and best known campaign is New Jersey's Jersey Fresh, which began in 1983 and currently has an annual budget of about $1.2 million.
In 1993, Arizona launched its own program--Arizona Grown. In its first year of operation it had no appropriated funds available for promotion. However, it did have a staff position within the Arizona Department of Agriculture dedicated to this effort and it also received private sector contributions. In addition, Arizona Grown bolstered its campaign by conducting it in conjunction with the Arizona Department of Health Services's 5-A-Day campaign. In fiscal year 1997, the Arizona legislature appropriated $25,000 for the campaign, but required an equal private sector match. For fiscal 1998, this appropriation has been increased to $50,000. Most of its campaigns have used POP materials and public relations marketing methods. No purchased media advertising has been used.
Many of the state grown promotion programs began in the early 1980s, partly in response to the widespread agricultural recession and the "New Federalism" of the Reagan administration, which shifted federal programs to the state level. However, these programs have not escaped criticism. For one, if states can not truly differentiate their products, then their promotional efforts may benefit products from other states, establishing a free rider problem. Alternatively, if a state is successful in promoting its product, this success may come at the expense of another state, raising questions on whether these programs advance the welfare of the nation as a whole. To date, little research has been conducted on these issues, the view of consumers on these programs, or their impact on product sales. NFAPP, though, has undertaken a preliminary analysis on Arizona Grown.
In conjunction with the most recent Arizona Grown campaign conducted during January 1997 in the Tucson and Phoenix metropolitan areas, a twofold analysis was conducted. One, shoppers at specified stores were surveyed to collect information on their views on Arizona Grown. Two, the impact of the Arizona Grown POP materials on product sales was analyzed. This part of the analysis involved the execution of a market experiment. Sales data from stores from the Safeway and ABCO Foods grocery chains were collected. The stores in the analysis were selected to represent different consumer groups and different geographic areas. The stores in the analysis were then divided into three groups while maintaining a balance across established consumer and geographic profiles. In one group, the Arizona Grown POP materials were installed by a merchandising agent. Stores participating in the campaign in the past had requested this service. Therefore, there was an interest in determining if this service increased the effectiveness of the campaign. In the second group, the POP materials were given to the store personnel and they were requested to install it themselves, as had been done in previous years. The third group served as a control group and no POP material was given to this group. All the stores served as sites for the consumer interviews. The findings from the consumer interviews are summarized first below.
Of the 571 consumers interviewed, only 25% indicated that they were aware of the Arizona Grown program. In contrast, 76% indicated that they would prefer a product grown in Arizona, expressing the belief that these products would be fresher or of higher quality. These results are similar to studies on Jersey Fresh. Additional analysis revealed that consumers who are frequent purchasers of fresh fruits and vegetables, aware of the 5 A Day campaign, permanent residents of Arizona, or had achieved higher levels of education were more likely to be aware of Arizona Grown. Age, race, and city of residency did not influence awareness. It was also found that older consumers, frequent purchasers of fruits and vegetables, or Phoenix metropolitan area shoppers were more likely to indicate that they would prefer products grown in Arizona.
In evaluating the impact of the Arizona Grown POP materials on products sales, tests were conducted to determine if sales of specific fruits and vegetables increased at the stores with the POP materials relative to those with no POP materials during the month of the promotion (January) and the month following the promotion (February). All products in the analysis - oranges, lemons, broccoli, green cabbage, cauliflower, carrots, spinach, and iceberg, red leaf, green leaf and butter lettuce - were from Arizona sources. Statistically significant increases in sales were only found for iceberg and red leaf lettuce. Significant increases in iceberg lettuce sales during January were found for stores with the POP material installed by merchandisers. Increased iceberg lettuce sales were also found during February in stores with store-installed POP materials. Significant increases in red leaf lettuce sales during February were found for stores with merchandiser installed materials.
In summary, it appears that Arizona consumers would prefer to purchase Arizona products. However, the most recent campaign only had a modest impact on product sales. This is likely related to the low level of consumer awareness. Awareness could be increased given additional funding, particularly for media advertising. Whether funding should be increased, though, remains an open question until further research on the implication of these kinds of programs can be conducted.
This article summarizes the recent NFAPP Policy Briefing Paper #97-6.
by Richard Adu-Asamoah, Ph.D.
After a decline in both total U.S. planted and harvested acreage in 1995 (1.5 and 1.2 percent respectively from 1994), there has been a gradual buildup of acreage which is likely to continue through 1998. The decline in total acreage can be attributed to declining planted and harvested acreage in the leading producing state of Texas (Figure 1), and several of the smaller producing states, notably Alabama, Arkansas, Louisiana, Maryland and Missouri, since 1995. Even though harvested acreage declined in California also in 1996, accumulated gains in yields in California and Arizona, and to some extent Georgia, have prevented serious shortfall in domestic production. Average annual grower price for all major regions (adjusted for regional production) will fall between $7.6 and $8.0 per cwt. for the 1997 season. Deviations from these estimates will be determined by regional differences that will influence ripeness, uniformity, shape, and rind and flesh quality. Barring any serious weather and disease problems, 1998 production and price trends should resemble those of 1997. Peak production prices (especially during summer months), however, may be substantially lower than these annual averages.
