With the likelihood that Arizona and California pistachio farmers will shake a record crop from their trees this fall, American Pistachio Growers (APG) is pulling out all of the stops to keep its wave of marketing success rolling in 2021 and well beyond. APG’s marketing team has just put the final touches on a new advertising campaign that combines extensive television advertising in major markets across the U.S. as well as additional print and digital media advertising in all key export markets.
“The anticipated record harvest and the concerted effort to bolster domestic marketing, focus on increasing the export market, as well as focusing on the healthy aspects of this important nut crop emphasizes the need to continue to reach new buyers of this and other healthy nut crops, including Arizona pecans,” Says Agricultural Services Co. Inc. President Harold Payne and president of Arizona Pecan Growers.“The renewed efforts in the advertising campaigns which have been upgraded from traditional new media venues to now include social media access through ‘influencers’ and campaigns targeting ‘foodies’ and their audiences which promote the healthy benefits of nuts in the diet. The efforts by the APG to expand and enhance the export market has direct benefits to Arizona growers, as the export market, particularly into China, was responsible for creating several years of excellent nut prices, which have diminished during the past couple of years of retaliatory tariffs between China and the U.S.”
U.S. growers are keenly aware that their success depends on keeping export channels open in major countries around the world. Prior to the COVID-19 pandemic, pistachio and pecan exports were running strong. In the 2018/19 marketing year, U.S. pistachio shipments set a record despite stiff retaliatory tariffs imposed by China, according to the Rabobank report.
“The ongoing expansion of pistachio and pecan acres in the western U.S. means increased production over the next decade, and millions of dollars of funds from Arizona nut growers are being dedicated to enhancing the reach of advertising and research to reach new consumers of American nuts,” adds Payne. “The recent Federal Marketing Order approved by U.S. pecan growers is an example of industry donating funds to increase the market share of pecans, following the success of this type of program in the pistachio and almond industries.”
The Pistachio Market
Worth more than $2 billion dollars, the U.S. pistachio market will need a keen marketing strategy. While Arizona and New Mexico have growing acreage in pecans and pistachios, the largest share of U.S. pistachios comes from California. As a California commodity, pistachios have been on a tear in recent years and now occupy a sixth place on the state’s list of more than 350 commodities with a value of $1.94 billion, according to California Department of Food and Agriculture 2019 data. Pistachios rank as the state’s second-leading export with a value of $1.1 billion. As interest in pistachios has grown in California as well as in Arizona and New Mexico so has the need to market larger crops to a growing international market.
APG’s strategy is to keep consumer demand running strongly ahead of what appears to be a large 2020 crop. According to APG President Richard Matoian, the U.S. pistachio crop that growers are currently harvesting could hit the 1-billion-pound mark --- setting a new production record.
“We are investing in our biggest advertising and marketing campaign ever to capitalize on this expansion in U.S. pistachio production,” said Judy Hirigoyen, APG Vice President, Global Marketing. “We have great synergy from all of the work we have done in recent years collaborating with great partners in professional sports, the research community, and with some of the world’s leading nutritionists and researchers.”
Even with the effects of the pandemic and ongoing trade tensions with China, Rabobank analysts state that market demand for pistachios remains strong in both domestic and international markets. Although total demand could be affected by a global economic downturn due to the COVID-19 pandemic, they state that the demand outlook is still “favorable” and is set to keep pace with the anticipated expansion in U.S. pistachio production in the years ahead, citing the nutrition research and promotional efforts as contributing factors to their prediction.
There is also heartening news contained in the pages of APG’s April 2020 consumption/share of the market report. The report’s data found that total consumption and market share from 2016-2019 are on an upward trajectory in several key markets. In China, for example, total consumption is up 573% and market share has surged to 57.5%. In Germany, the report found total consumption had risen 288.5% and market share was 65.7%. In India, total consumption and market share were up 74.3% and 58.6% respectively.
For the first time ever APG is employing an advertising and marketing push that combines television, print and digital advertising in major export countries as well as in major television markets in the U.S. Beginning in mid-November and continuing through next summer, ads extolling the virtues of U.S. pistachios will appear in 44 U.S. television markets ---- from Honolulu to Washington, D.C. Included in the U.S. advertising effort is APG’s sponsorship of New Year’s Eve countdown celebrations in Las Vegas, Nevada and Dallas, Texas --- covering 26 key television markets.
“Consumers here in the U.S. as well as abroad are embracing the powerful stories of pistachios --- that they are packed with important nutrients and have been recognized as being a “complete” protein source, putting pistachios in the company of other plant-based complete proteins, such as quinoa and soy,” Hirigoyen said. “We think these stories will really resonate with TV viewers across the nation.”
“On top of the expected record harvest this year, with the expansion of new acreage comes into bearing, we know that will present greater marketing challenges in the years ahead,” said Alison Nagatani, Chair of the APG Marketing Committee and a pistachio grower from Earlimart. “The Rabobank report projects bearing acreage could reach 372,000 acres by 2024/25 --- about 30% greater than in 2019/20. Clearly, we have our marching orders to keep blazing the marketing trail, both here at home and in our key international markets.”
“Marketing ahead of production and capitalizing on the contributions of our industry partners and the incredible array of research that touts the unique and powerful health attributes of pistachios will all play a role in continuing our marketing success,” Nagatani said.
An Arizona pistachio farmer concurs with the overall assessment of APG’s targeted marketing efforts. “We are members of the APG and I was honored to serve on the APG board of directors and its predecessor organization Western Pistachio Association for nine years,” says Jim Graham owner with his wife, Ruth, of Cochise Groves Farming in Southern Arizona. “From the time Ruth and I became involved in the pistachio industry in 1998, we have seen the U.S. production increase dramatically. U.S. acreage and production have increased more than three-fold. Arizona acreage and production have also increased rapidly in the last decade. Fortunately, pistachios have become a popular snack for domestic and foreign consumers. Well over half of the U.S. production is exported, primarily to Asian and European countries.
“Despite tariff conflicts with important market destinations like China, shipments of US pistachios continue to be relatively strong. Worldwide demand has kept market prices to producers comparatively strong as well, although concern exists about the impact of how a billion-pound 2020 crop will affect producer prices. An important focus on pistachio marketing has been the nutritional benefits of pistachios as a snack. As consumers become more aware of these benefits, the consumption of U.S. pistachios will need to keep pace with increasingly larger crops. Thus, the APG marketing efforts will be critical to the success of the US pistachio industry.”Jim and Ruth Graham also have a vineyard and winery, Golden Rule Vineyards.