Apple Juice

Mark Gentry&

Louis Vasquez

Category Assessment• We Audited 10 Stores

– (3) Wal-Mart– (3) Harp’s– (2) WalGreen’s– (1) Marvin’s– (1) Target

• We found a total of 30 sku’s for these stores• Great Value was the leading Brand in Wal-Mart• Nestle Juicy Juice was found in 7 out of 10 store

Sku Display Store Sku’s Dominating Brand

Wal-Mart 6th 10 Great Value

Wal-Mart Joyce 10 Great Value

Harp’s College 11 AWG

Harp’s Crossover 13 AWG

Marvin’s 13 Musselman’s

Overview

• The category Apple Juice had total sales of 616,309,900 in 2007.

• Private Label Per Store is the leading brand– For the stores we audited we found that the

Private Label brands led the way especially for Wal-Mart and Harp’s.

Demographics

• According to data for the selling year of 2003• The leading buyer in Apple Juice plus Private label

have the following qualities:– Income $30,000-$70,000– Kids less than 6 years old– 5+ Family member

• Old Orchard led the way for lower income families• Along, with lucky leaf for incomes under $20,000

52 WEEKS ENDING 12/27/03

52 WEEKS ENDING 12/29/07

52 WEEKS ENDING 12/27/03

52 WEEKS ENDING 12/29/07

52 WEEKS ENDING 12/27/03

52 WEEKS ENDING 12/29/07

52 WEEKS ENDING 12/27/03

52 WEEKS ENDING 12/29/07

TOTAL HOUSEHOLDS 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0INC - <$20,000 78.1 72.7 73.4 46.4 74.7 56.8 45.0 55.1

INC - $20,000-29,999 84.8 77.3 88.9 67.4 85.3 73.8 78.4 58.9INC - $30,000-39,999 104.2 99.6 145.4 96.5 85.6 99.5 104.6 70.8INC - $40,000-49,999 114.0 116.9 117.1 44.4 111.4 70.8 98.6 114.0INC - $50,000-69,999 113.1 123.5 108.8 152.6 124.0 184.6 111.8 109.0

INC - $70,000+ 111.4 NA 82.7 NA 120.2 NA 160.6 NAINC - $100,000+ NA 99.5 NA 139.2 NA 104.1 NA 157.8

SIZE - 1 MEM 39.7 42.1 65.5 72.4 42.6 49.0 53.1 28.8SIZE - 2 MEM 67.1 68.9 86.0 83.6 65.1 102.7 68.1 60.2

SIZE - 3-4 MEM 145.6 146.6 123.6 119.1 165.6 115.5 138.5 150.2SIZE - 5+ MEM 216.2 203.4 159.1 163.1 158.4 172.8 200.8 252.4

AGE FH - UNDER 35 165.7 167.5 119.0 91.7 160.6 135.8 182.8 169.1AGE FH - 35-44 138.8 148.7 111.1 164.3 126.9 126.0 112.2 140.9AGE FH - 45-54 95.2 88.4 97.9 82.7 113.6 118.9 75.8 89.2AGE FH - 55+ 67.0 62.0 90.6 93.7 61.9 68.1 72.0 64.9

AGE FH - 55-64 69.5 71.3 82.8 128.4 61.4 70.1 61.3 62.6AGE FH - 65+ 65.0 52.6 96.9 58.1 62.4 66.1 80.5 67.3

AGE FH - NO FEMALE HEAD 58.5 67.6 88.7 83.0 61.0 74.0 80.2 67.4KIDS - NONE < 18 59.8 58.7 84.6 85.2 60.9 80.6 65.8 54.2KIDS - ANY < 18 179.2 176.8 130.3 127.5 177.0 136.2 167.4 185.1KIDS - ANY < 6 235.7 240.6 184.3 154.4 218.4 181.8 247.3 245.6

KIDS - ANY 6-12 178.6 171.8 124.2 170.8 156.8 141.3 171.4 184.4KIDS - ANY 13-17 161.3 165.2 120.5 68.6 179.2 120.5 147.6 164.0

EMP - FH EMPLOYED 112.9 111.0 91.9 107.7 115.7 102.5 110.9 103.0EMP - FH EMP. FULL TIME 104.2 101.5 84.4 92.6 96.7 96.1 111.3 106.9EMP - FH EMP. PART TIME 134.8 137.5 110.7 149.5 163.4 120.2 109.8 92.0EMP - FH NOT EMPLOYED 105.0 104.1 117.3 99.7 99.9 111.2 95.9 114.2EMP - NO FEMALE HEAD 58.5 67.6 88.7 83.0 61.0 74.0 80.2 67.4

RACE - CAUCASIAN 86.4 91.0 101.7 95.1 90.0 85.2 89.0 78.5RACE - NON-CAUCASIAN 151.6 131.5 93.6 117.1 137.8 152.0 141.4 175.2RACE - AFRICAN AMER. 169.5 152.0 124.8 188.4 157.4 216.3 82.0 80.5

RACE - ASIAN 111.5 83.5 49.0 31.4 71.1 65.4 206.0 359.1RACE - OTHER RACE 134.0 117.0 56.0 39.9 124.8 85.3 218.2 254.9

TREE TOP OLD ORCHARD CTL BR - FRUIT JUICE - APPLE

MUSSELMAN'S

Display Space• Wal-Mart had the largest display and selection of Apple Juice

Available– They used on average 54% of the facing available per store

to display their great value product• Harp’s had the next highest percentage at 40%• The smaller stores usually had a about 50/50 ratio of their

private label displayed

RetailerManufacturer Wal-Mart 6th Harps College Harps X-Over Marvins TargetAmerican Brands % of Total Sum 17.7% 51.6%

% of Total N 20.0% 42.9%N 2 3

AWG % of Total Sum 51.4% 28.1% 3.0%% of Total N 27.3% 23.1% 7.7%N 3 3 1

Clear Value % of Total Sum 9.1%% of Total N 7.7%N 1

Harvest Classic % of Total Sum 4.8%% of Total N 10.0%N 1

Knouse Foods % of Total Sum 10.0% 28.1% 21.2%% of Total N 36.4% 30.8% 23.1%N 4 4 3

Langer Juice Co. % of Total Sum 25.7% 6.3% 6.1%% of Total N 9.1% 7.7% 7.7%N 1 1 1

Nestle % of Total Sum 14.5% 5.7% 15.6% 15.2% 19.4%% of Total N 20.0% 9.1% 15.4% 15.4% 14.3%N 2 1 2 2 1

Old Orchard LLC. % of Total Sum 4.3% 9.4% 9.1% 9.7%% of Total N 9.1% 7.7% 7.7% 14.3%N 1 1 1 1

S. Martinelli % of Total Sum 9.1%% of Total N 7.7%N 1

Sabroso % of Total Sum 11.3% 2.9% 12.5% 9.1%% of Total N 20.0% 9.1% 15.4% 7.7%N 2 1 2 1

Shurfine Markets % of Total Sum 18.2%% of Total N 15.4%N 2

Target % of Total Sum 19.4%% of Total N 28.6%N 2

Wal-Mart % of Total Sum 51.6%% of Total N 30.0%N 3

Total N 10 11 13 13 7

Private Label

• With Wal-Mart leading the way all retail chains large and small have begun to develop a private label

• Wal-Mart– Great Value

• Target– Market Pantry

• Harp’s– AWG/Always Save

• Wal-Greens– Wal-Greens

Category Role

• Apple Juice maintains margins anywhere from 20% to 50%

• According to 2007 data Apple Juice had a penetration percentage of 41%

• This break down leads to Apple Juice being a “Cash Machine”

  ITEM $ (000) DOLLAR SHARE

ITEM BUYERS (000)

ITEM PENETRATION

ITEM $ PER ITEM BUYER

% ITEM $ ON DEAL % DOLLARS WITH MANUFACTURER

COUPON

FRUIT JUICE - APPLE616,309.9 100.0 47,080.5 40.6 13.1 22.5 1.7

LANGERS10,818.7 1.8 2,345.2 2.0 4.6 39.6 1.9

MARTINELLI'S13,726.5 2.2 786.7 0.7 17.4 3.3 0.0

MOTT'S 86,828.3 14.1 11,391.0 9.8 7.6 26.4 2.4

MOTT'S ORGANICS659.6 0.1 137.9 0.1 4.8 6.8 6.6

MUSSELMAN'S2,366.6 0.4 479.6 0.4 4.9 30.7 0.1

NESTLE JUICY JUICE43,445.1 7.1 5,811.5 5.0 7.5 16.2 3.8

OLD ORCHARD20,272.3 3.3 4,384.3 3.8 4.6 29.7 0.9

OLD ORCHARD ORGANICS 951.0 0.2 138.1 0.1 6.9 17.5 0.6

TREE TOP62,038.4 10.1 6,271.1 5.4 9.9 25.0 5.3

Recommendations

• Private label was seen in all the stores we chose to audit

• Wal-Mart led the way in this category by far and away.– Their entry into this category has shown great success

but has not made other retailers shy away from pursuing their labels as they all have shown success.

• Private label in Apple Juice shows proven success and would be a wise choice to enter the market.