Spotlight On: Avocados From Mexico

Alvaro Luque might not want you to know this, but his job as president of Avocados From Mexico might seem relatively easy these days. 

Like selling umbrellas on a street corner in New York City during a heavy rainstorm, pitching avocados to the retail world has become relatively simple as consumers put the fruit in everything from salads to burgers—and even exotic alcoholic beverages. 

The numbers are staggering. According to the Irving, Texas-based association, avocados are registering annual double-digit sales growth over the last decade and the category’s total volume, in pounds, has doubled to about 2.4 billion pounds in just the last six years. Per capita consumption has also dramatically increased, from around 3.8 pounds per person in 2010, to nearly seven pounds per person this year. Luque says that about 50 percent of avocado sales are made through retail.

Retailers, of course, have noticed and have responded by giving avocados more space in their produce sections and getting more involved in various promotional and cross-merchandising opportunities—many of them sponsored by Avocados From Mexico—to build the category and reap its many rewards. “Everyone sees the potential of avocados and the sales figures,” says Luque. “Avocados are growing faster than the largest produce categories including bananas, potatoes and apples.”

Pitching Mexico and its abundant avocado stock is what Luque and his 27-person team are paid to do. The association was formed in 2013 with the help of the U.S. Department of Agriculture when Mhaia, an association that represents 130 U.S.-based importers of Mexican avocados, joined forces with Apeam, a group representing 40 packers and 19,000 growers, to get their collective message out to American shoppers. A USDA regulation requires that for every pound of imported avocados from Mexico sold in the U.S., 2.5-cents must be allocated to marketing and promotional efforts, as well as research. 

Right now, products from Mexico are responsible for about 81 percent of all avocados sales in the U.S., far ahead of California, which is second with about 13 percent of total sales. Most of the remainder of the product is imported from South America. Luque is confident that he can gain even more market share in the category by promoting the quality of the Mexican product and giving consumers more reasons to use avocados in the future. 

Interestingly, he is focusing on the current users of avocados for immediate growth. Luque says that industry statistics show that household penetration of avocados lie around 50 percent of U.S. homes. Instead of targeting the half of the population that does not consume avocados, he is focusing on the half that does, confident that his promotional activities will get them to increase consumption. “Our strategy is to focus on the consumers who like avocados and show them more ways and times to use them,” he says. “Half of the consumers who currently purchase avocados are light or medium users of the product. They know the fruit already so we don’t have to educate them there. We just have to get them to consume more.

“Once we build our sales with this group, we will start to concentrate on the shoppers in the other half of the population who aren’t avocados consumers. That is another great opportunity for us.”

It may not be that hard to pull off. As Luque notes, avocados are considered a trendy, cool fruit by many consumers in the know, especially the healthy percentage of Millennials who are looking for products with the most nutritional benefits, while being versatile enough to use in many dishes and is still tasty. “That’s pretty hard to satisfy, but avocados manage to meet all those expectations and specifications,” he says.

With the power of its members behind it—Luque emphasizes that 75 percent of the Mexican growers have five acres or less of land and 90 percent have less than 10 acres—Avocados From Mexico has the money to push the category. The association spends about $18 million annually on its media campaign, which includes television, print and digital. Its ad during the Super Bowl has become a staple of the game and some say the talk around the water cooler the next day. Luque plans to continue that program. 

In fact, promotions are the biggest part of the association’s push. Luque is quite proud of the fact that Avocados From Mexico offers retailers nine promotional programs annually, including a back-to-school program and a Summer Celebration, which runs from May to July. The association also, often in conjunction with other companies that offer related products, offers such promotions as the Tastiest Tailgate with Rotel in October, Season’s Eating around the fourth quarter holiday season, Fanwich in February and March, and Fiesta del Fuego for Cinco De Mayo in April and May. 

Its biggest promotion is Guac Nation, with Old El Paso, that runs from late December through Super Bowl Sunday and promotes avocados for Super Bowl parties and features specially designed bins, coupons and other incentives. “We want to accelerate the growth of the category,” Luque says. “We want to make a big splash at the right times of the year. This is a high margin area and we want to create even more demand to help our retail partners.”

The association is set to launch a breakfast promotion in late winter that will join with other companies that offer such related products as eggs and dairy. “It’s our first venture into breakfast foods, and again it is designed to create even more demand for avocados,” Luque adds. “We are finding that a lot of companies want to partner with us because they sense the popularity of avocados and the power of Avocados From Mexico in supporting our members.”

Targeting Millennials is another opportunity, Luque says. The association is launching a tour of more than 40 colleges to promote the avocado category and to build interest with younger consumers. 

“We do all of this to show our retail partners that Avocados From Mexico is a great driver and a leader in this category,” he notes. “We can develop business for retailers in specific areas of their stores, from the salad bar to produce to even the sandwich department. We will grow our categories and others too.”

With a great recent history, the future may look even better. Luque says that with household penetration at around 50 percent, there is nowhere to go but up for the category, the association and its members. “We have a lot of work to do in getting our existing base to buy more avocadoes and getting new customers to try the product. And we need to constantly reinforce the message to all shoppers, including Hispanics who tend to lose a little interest in their heritage as they acclimate to society. But we are definitely up for the challenge and ready to do all we can to help this category continue to grow for us and our retailers.”