The demand for orange juice (OJ) would decline by 11.3% without the awareness produced by Florida Department of Citrus (FDOC) promotional activities, the Florida Citrus Commission was told in December. Marisa Zansler, FDOC economic and market research director, delivered that message in summarizing a recent report by Lisa House, chair of the University of Florida’s Food and Resource Economics Department. House’s report was of an annual study of the benefits of FDOC generic promotion on the demand for OJ.
House’s report indicated that FDOC programs support up to 111 million equivalent gallons of OJ, which is equivalent to approximately 20 million Florida grower boxes.
HEALTH AND WELLNESS MATTER
Zansler also reported on a Nielsen model showing consumer perception of the health and wellness benefit of OJ. FDOC promotions focus heavily on those benefits. In that study, 39% of consumers stated that health and wellness were major reasons for buying 100% OJ.
The Nielsen model results regarding return on investment indicated that FDOC promotions had a benefit-cost ratio between 4.32 and 5.6. That signifies that each dollar spent on generic promotions of processed orange marketing returned between $4.32 and $5.60 to the Florida grower in added revenue at the delivered-in price level.
INFLATION AND OJ PRICES
Inflation is up by 7.1% according to the U.S. Bureau of Labor Statistics, and the price of OJ has increased significantly, Zansler reported. She said the price per equivalent gallon for total OJ is currently $8.50, a 12.1% increase from 2021. In the not-from-concentrate category, the price per equivalent gallon is $10.05, which is a 9.7% increase from last year. The price of reconstituted OJ is also on the rise.
Zansler reported that a decline in promotional activity has put pressure on the price increase. Promotional activity for this holiday period was at 27.5% for all gallons sold, compared to 30.1% last season. Price continues to be an issue that will persist, according to Zansler.
Read more from Zansler.
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