24 Mar 2011 How carrots became the new junk food
Jeff Dunn (left) believes he can double the $1-billion US baby-carrot business — and promote healthy eating — by marketing the vegetable like Doritos. His secret weapon? He knows every snack-marketing trick in the book… Much previous mention has been made on FOODStuff SA of this innovative marketing campaign, but now you can read the inside story here….
Bolthouse Farms sells nearly a billion pounds of carrots a year under a number of different brand names and supermarket labels. Only Grimmway Farms, a few minutes down the road in Bakersfield, California, sells more, just barely. Together, the two companies control more than 80% of the carrot market in the United States. As produce growers go, they are huge businesses — in Bolthouse’s case, between $600 million and $800 million a year in revenue, including premium beverages (carrot juice, of course, as well as açai, fruit smoothies, and vanilla chai) and salad dressings.
The company has been around for nearly a century now, but it boomed in the 1990s, with a breakthrough product. A local grower named Mike Yurosek had become frustrated with all the waste in the carrot business. Supermarkets expected carrots to be a particular size, shape, and color. Anything else had to be sold for juice or processing or animal feed, or just thrown away. Yurosek wondered what would happen if he peeled the skin off the gnarly carrots, cut them into pieces, and sold them in bags. He made up a few test batches to show his buyers. One batch, cut into 1-inch bites and peeled round, he called “bunny balls.” Another batch, peeled and cut 2 inches long, looked like little baby carrots.
Bunny balls never made it. But baby carrots were a hit. They transformed the whole industry. Soon, the big growers in Bakersfield were planting fields with baby carrots in mind, sowing three times more seeds per acre, so the carrots, packed densely together, would grow long and skinny, for the maximum number of 2-inch cuts. Yields and profits climbed. The really big deal, the thing nobody expected, was that baby carrots seemed to make Americans eat more carrots. In the decade after they were introduced, carrot consumption in the United States doubled.
Then a couple of years ago, after a decade of steady growth, Bolthouse’s carrot sales went flat. Sales of baby carrots, the company’s cash carrot, actually fell, sharply, and stayed down. Nobody knew why. This was a big problem.
For Jeff Dunn, Coca-Cola was the family business. Dunn’s father spent most of his career at the company negotiating huge sponsorship deals around events like the Super Bowl and the Olympics. Just a few years out of college, Dunn followed him. Dunn eventually took over his father’s job and became one of the company’s top executives, overseeing all of Coca-Cola’s businesses in North and South America. Like his father, Dunn considered himself a marketing guy, which made sense for a top executive at a soft-drink company. “We were selling sugar water and fairy dust,” Dunn says. “And don’t forget the fairy dust.”
Three years ago, he became CEO of Bolthouse. His office is across the street from an agricultural machine yard filled with tractors, seeding trucks, and 65,000-pound harvesters. It has been something of a change. Then again, there are similarities. “Carrots are basically a duopoly,” he says. “It’s Coke and Pepsi.” And when he looked at his flagging sales, he wondered if some fairy dust might help.
Dunn put together a series of focus groups and surveys and discovered something interesting. People said they were eating as many carrots as they always had. But the numbers clearly showed they were buying fewer. What people meant, it turned out, was they were as likely as ever to keep carrots in the fridge. When the recession hit, though, they became more likely to buy regular carrots, instead of baby carrots, to save money. But people used to eating baby carrots weren’t taking the time to wash and cut the regular ones. And unlike baby carrots, which dry out pretty quickly once a bag is opened, regular carrots keep a long time. So people were buying regular carrots and then not eating them, and not buying more until the carrots they had were finally gone or spoiled.
Bolthouse had never marketed its baby carrots. It just sent truckloads to supermarkets, where they got piled up in the produce aisle. Dunn assembled a small team and studied advertising campaigns for other agricultural commodities, such as almonds, avocados, eggs, and milk. They were shocked at what they found. “Every campaign paid back,” Dunn says. “Every single one. Between 2 and 10 times.”
So they drafted a brief to circulate to ad agencies. “Carrots have an appealing personality. Fun, fun-loving, friendly. High-energy. Visually appealing,” they explained. “Baby carrots are the best form factor of carrots.” Dunn was clear: He didn’t want a health campaign, one that talked about beta carotene or cutting calories. He wanted something more emotional, maybe something funny, something that appealed to impulse rather than responsibility — the kind of thing a soft-drink or snack-food company might do.
Dunn’s team talked to more than 20 agencies. One firm pitched a commercial with a vegetable army, baby carrots in the lead, storming a beach defended by junk food. Another proposed pairing two unlikely celebrities together, or maybe rival politicians, with the punch line “Look who’s having a baby!” Dunn kept a memento from the proposal he liked best, a large model of a carrot ripping through a jelly doughnut, red jelly oozing from the exit wound. Nothing, though, seemed quite right. Even the outrageous ideas tended to come back to avoiding junk food and eating healthier.
Then something unusual happened. One of the agencies recommended a rival firm, Crispin Porter + Bogusky. They thought the sensibility Dunn was fishing for sounded like Crispin’s work. Dunn figured there was no way Bolthouse had the profile or the resources to hire a firm like Crispin. But he called them anyway. “You guys are kind of late to the game,” he said, “but do you want to take a crack at this?”….