THE NATIONAL WATERMELON PROMOTION BOARD CONSUMER REPORT

(DOMESTIC)

PREPARED FOR:

THE NATIONAL WATERMELON

PROMOTION BOARD

October, 2006

PREPARED BY:

rose research (r2)

5455 federal highway, suite q

boca raton, fl 33487

phone: (561) 241-1515fax: (561) 241-1505

BACKGROUND & PURPOSE/METHODOLOGY

BACKGROUND & PURPOSE

The National Watermelon Promotion Board (NWPB), a non-profit organization dedicated to increasing consumer demand for watermelon through marketing, research and education, commissioned this project to investigate how often U.S. consumers purchase watermelon (by season), what type of watermelon cut is preferred, factors which influence purchase behavior and aware of health benefits associated with watermelon. In addition to interviewing watermelon buyers, non-purchasers were also included in the survey in order to understand their reasons for rejecting it. All of this information will then be used to develop a comprehensive and effective marketing strategy.

The following are some of the areas of investigation covered in the research:

  • Type of fruit purchased within the past 12 months
  • Reasons for purchasing watermelon
  • Most important reason for purchasing watermelon
  • Seasons during which watermelon is purchased
  • Watermelon cuts purchased during different seasons (whole, sections/slices, cubes, mini watermelon)
  • Type of watermelon purchased most often
  • Frequency with which particular watermelon cuts are purchased during different seasons
  • Reasons for buying particular watermelon cuts
  • Reasons for not buying watermelon during certain seasons
  • Preference for seeded or seedless watermelon
  • Reasons for not buying watermelon in general
  • Reasons for not buying certain watermelon cuts
  • Factors influencing purchase intent
  • Most important factor influencing purchase intent
  • Awareness of watermelon health benefits
  • Awareness of lycopene content in watermelon
  • Purchase intent after knowing of watermelon health benefits
  • Purchase intent after knowing watermelon is good for the heart
  • Sources of watermelon health information
  • Influence of recipes and carvings on purchase intent
  • Influence of children on purchasing behavior
  • Person who consumes the most watermelon in the family
  • Demographics

In addition, reaction to the following new product ideas were also measured in this survey:

WATERMELON JUICE

Introducing…Watermelon juice, a refreshing juice made from real watermelon which not only tastes great, but also contains natural watermelon health attributes such as Lycopene, Vitamin C, Vitamin A, Vitamin B and potassium.

WATERMELON SORBET

Introducing…Watermelon sorbet, a refreshing sorbet made from real watermelon juice, which not only tastes great, but also contains natural watermelon health attributes such as Lycopene, Vitamin C, Vitamin A, Vitamin B and potassium.

WATERMELON BREAD

Introducing…Watermelon bread, a bread made from real watermelon with a taste and color similar to pumpkin bread and contains natural watermelon health attributes such as - - Lycopene, Vitamin C, Vitamin A, Vitamin B and potassium.

WATERMELON YOGURT

Introducing…Watermelon yogurt, a yogurt that is made from real watermelon and has a delicious taste, pink color and is loaded with natural watermelon health attributes such as, Lycopene, Vitamin C, Vitamin A, Vitamin B and potassium.

METHODOLOGY

A total of 3,128 interviews were conducted during June - August, 2006 among men and women in the United States,18 years of age or older and the primary grocery shopper of their household. Within the sample, 2,400 interviews were conducted among watermelon purchasers - - who were screened to be purchasers of watermelon (in any form) in the past 12 months, and 728non-purchasers. The watermelon purchasers were equally distributed among 8 regions across the U.S., including California, the West, the Plains, South Central, Great Lakes, Mid-South, Southeast and Northeast. All interviews were conducted via the telephone and the analysis was conducted by rose research, llc—a global market research company experienced in analyzing commodity data both domestically and on a worldwide basis.

The 8 regions are defined as follows:

California / Plains / Great Lakes / Southeast
California / Iowa / Illinois / Alabama
West / Kansas / Indiana / Florida
Alaska / Minnesota / Michigan / Georgia
Arizona / Missouri / Ohio / Mississippi
Colorado / South Central / Wisconsin / South Carolina
Idaho / Arkansas / Mid South / Northeast
Nevada / Louisiana / Kentucky / Connecticut
New Mexico / Oklahoma / Maryland / Delaware
Oregon / Texas / North Carolina / Maine
Utah / Tennessee / Massachusetts
Washington / Virginia / New Hampshire
West Virginia / New Jersey
New York
Pennsylvania
Rhode Island
Vermont

In addition, and where applicable, findings from the 2006 study are compared to previously conducted domestic studies in 2004 and 2002, as well as to a research project in Toronto, Canada, conducted simultaneously (with this study).

MANAGEMENT OVERVIEW

MANAGEMENT OVERVIEW

Positively, watermelon purchase penetration in 2006 is higher than both 2004 and 2002, however, slightly lower than Toronto, Canada.

% buying watermelon in past 12 months
2006 / 77
2004 / 74
2002 / 66
Toronto / 79

In addition, and similar to 2004, watermelon purchasing in 2006 either increased or remained static in most regions of the country, with consumers who are better educated, earn more money, have children (under the age of 18) living at home and aware of watermelon health benefits most likely to purchase watermelon.

Moreover, whole watermelon is the most popular type bought, as more than 7 in 10 buy it most often (71%), with sections/slices (18%), minis (6%) and cubes (5%) much lower.

Children have a significant impact on watermelon purchasing (both domestically and in Toronto), as about 8 in 10 of the shoppers (who have children living at home) mentioned that they have at least some influence (domestic – 79% and Toronto – 85%) - - particularly frequent summer buyers in the U.S. (82%).

Not surprising, the most important reason for purchasing watermelon is its “good taste” (43%), followed by “my family/kids like it” (13%), “it’s healthy/nutritious” (12%) and “it’s cool/refreshing/juicy” (11%). On the other hand, and similar to the 2004 data and the Toronto findings, “being too big/inconvenient” is the major purchase deterrent (2006 – 25% vs. 2004 – 22% and Toronto – 30%). However, some differences exist by region and demographics – with households in the West complaining about its “large size”, while those in the Plains and Southeast, as well as less affluent respondents mentioning that it’s “too expensive”. Additionally, older respondents are more apt to reject watermelon due to its “large size”.

In terms of why they buy the various varieties (whole, sections/slices, etc.), whole watermelon is credited for being a “better value” and “fresher”, while sections/slices and cubes are singled out for “it’s the right amount for me/my family”, “it’s easier to see the quality” and “convenience”, while cubes are also praised for “being a good snack”, “easy to fit in the refrigerator”, “easy to take with you” and “you don’t have to cut it”.

On the other hand, whole watermelon is criticized for being “too big/not convenient” and “my family can’t finish it all/wasteful”, while sections/slices and cubes generate negatives due to the perception that they are “expensive” and concern about their “freshness”.

Interestingly, while mini watermelon is also considered to be “the right size/amount for the family”, “easier to fit into the refrigerator” and “more convenient”, it is also thought to be “expensive” and to some consumers, “too small”, with other respondents unfamiliar with it.

Seedless watermelon continues to be preferred over watermelon with seeds - - higher than in the 2004 and 2002 domestic studies (2006 – 60% vs. 2004 – 56% vs. 2002 – 47%), however significantly lower thanToronto (69%). Specifically, the following subgroups prefer seedless watermelon - - more affluent households ($50,000 or higher) younger respondents (less than 46 years old) and college graduates.

Similar to 2004 and 2002, summer is the time watermelon is usually bought - - with the whole variety most popular throughout the year.

PURCHASE PENETRATION BY SEASON
Domestic 2006
% / Toronto 2006
% / Domestic 2004
% / Domestic 2002
%
(a) / (b) / (c) / (d)
Summer / 99 / 99 / 99 / 99
Spring / 61 / 72 acd / 59 / 64 ac
Fall / 39 d / 52 acd / 43 ad / 36
Winter / 19 / 35 acd / 19 / 19
BASE / (2400) / (200) / (2400) / (2044)

Base: Those who purchased watermelon within the past 12 months

a-d-Significantly different at the 95% confidence level

PURCHASE OF WATERMELON CUT BY SEASONS
Summer
% / Fall
% / Spring
% / Winter
%
(a) / (b) / (c) / (d)
Whole watermelon / 78 bcd / 57 d / 59 d / 39
Watermelon sections or slices / 26 / 32 a / 30 a / 40 abc
Mini watermelon / 16 bcd / 11 / 11 / 11
Watermelon cubes / 8 / 13 a / 11a / 23 abc
BASE / (2392) / (946) / (1453) / (447)

Base: Those who purchased watermelon in the summer, spring, fall or winter

a-d-Significantly different at the 95% confidence level

Notably, one of the primary reasons for not purchasing watermelon during the winter, spring and fall is that consumers (particularly infrequent summer purchasers) consider it to be a “summer fruit” - - a perception that might be changed by positioning it as an “all year round” fruit - - which potentially could broaden its appeal among this essential consumer segment and ultimately increase sales.

Another area which should continue to be strengthened is the “healthiness of watermelon” - - as only one-third of the shoppers are aware of its health benefits - - (which is on par with the research conducted in 2004 and Toronto- - 2006 – 35% vs. 2004 – 38% vs. Toronto – 35%). Along these lines, unaided awareness of specific health benefits is also modest, with the highest mention being a general recognition that “it has vitamins” (28%). However, in total (unaided and aided responses combined), the majority of the consumers played back that watermelon is “low in fat” (91%), “low in calories” (87%), “high in vitamin C” (68%) and “contains the antioxidant lycopene” (57%) - - significantly higher than 2004 findings (46%). Notably, there is a correlation between having a high income, better education and heavy summer use, as all of these consumer segments are more knowledgeable about the nutritional advantages that watermelon provides.

Moreover, and an indication of the importance of “watermelon health benefits”, the vast majority of the respondents (who are aware of watermelon health benefits) would buy watermelon because “it’s good for them” (2006 – 77% vs. 2004 – 78% vs. Toronto – 83%), while knowing that watermelon is “good for your heart” is even more impactful, as 81% indicated that they would be more apt to buy it if they had this information.

Another opportunity to increase watermelon sales is to distribute “new recipes” or “ways to use it”, as about 3 in 10 mentioned that it would motivate them to use watermelon more often - - both domestically and in Toronto.

Finally, in terms of new product opportunities, of the 4 new ideas tested, all of them were below our norm in the U.S., however Toronto offers more potential. Specifically, purchase interest in the watermelon juice, watermelon sorbet and watermelon yogurt all surpassed our purchase interest target of 50% in Toronto, while falling short in the U.S.

Top 2-Box Purchase Interest (Definitely/Probably Will Buy)
Toronto
%
(a) / U.S.
%
(b)
Watermelon Juice / 57 b / 37
Watermelon Sorbet / 59 b / 43
Watermelon Yogurt / 59 b / 44

a-b-Significantly different at the 95% confidence level

However, interest in watermelon bread was low in both Toronto and the U.S. (Toronto – 31% vs. U.S. - 21%).

All in all, while incidence of purchasing watermelon continues to grow in the U.S., we would suggest strengthening the health benefits of watermelon - - particularly that it’s “good for your heart”, as well as positioning it as a “year round fruit the whole family can enjoy”. In addition, we would also recommend that the NWPB commission a study to further investigate the attitudes and behavioral practices of infrequent versus frequent summer watermelon purchasers as a means of determining how to motivate them to buy watermelon more often.

DETAILED FINDINGS

TYPES OF FRUIT PURCHASED IN THE PAST 12 MONTHS

  • Watermelon purchase penetration continues to grow - - as 77% of the consumers in the U.S.bought it in the past year - - compared to 74% in 2004 and 66% in 2002.
  • Notably, domestic purchasing is slightly lower thanToronto this year (domestic - 77% vs. Toronto - 79%).

TYPES OF FRUIT PURCHASED IN THE PAST 12 MONTHS
Domestic
2006
% / Toronto
2006
% / Domestic
2004
% / Domestic
2002
%
(a) / (b) / (c) / (d)
Bananas / 96 c / 95 c / 92 / 95 c
Apples / 92 cd / 95 acd / 87 / 90 c
Oranges / 80 cd / 85 cd / 72 / 77 c
Watermelon / 77 cd / 79 d / 74 d / 66
Cantaloupe / 77 bcd / 62 / 72 b / 70 b
Honeydew / 37 d / 42 d / 36 d / 33
BASE / (3128) / (253) / (3230) / (2296)

Base: Total respondents

a-d-Significantly different at the 95% confidence level

Q.1. Which of the following fruits have you purchased in the last 12 months?

  • In addition, incidence of purchasing various other fruits (bananas, apples, cantaloupe, oranges and honeydew) among watermelon purchasers is significantly higher compared to non-purchasers.

TYPES OF FRUIT PURCHASED WITHIN THE PAST 12 MONTHS
Domestic 2006 Watermelon Purchasers
% / Domestic 2006
Watermelon Non-Purchasers
%
(a) / (b)
Watermelon / 100 b / -
Bananas / 97 b / 94
Apples / 94 b / 85
Oranges / 83 b / 69
Cantaloupe / 82 b / 58
Honeydew / 41 b / 24
BASE / (2400) / (728)

Base: Total respondents

a-b-Significantly different at the 95% confidence level

  • Compared to both previously conducted domestic studies, watermelon purchasing in 2006 has either increased or remained static in every region of the country, with the exception of the South Central and the Plains states where there was a slight decline.

(a) (b) (c)

a-c-Significantly different at the 95% confidence level

  • Better educated consumers, high income earners, respondents with children (under the age of 18) living at home and those aware of watermelon health benefits are most likely to purchase watermelon than their respective counterparts.

WATERMELON PURCHASERS
EDUCATION / INCOME / HAVE MINOR CHILDREN LIVING AT HOME
<Coll.
Grad.
% / Coll. Grad+
% / <$50K
% / $50K - <$75K
% / $75K+
% / Yes
% / No
%
(a) / (b) / (c) / (d) / (e) / (f) / (g)
Bought watermelon / 75 / 80 a / 74 / 78 c / 82 c / 84 g / 76
BASE / (1674) / (1289) / (1045) / (487) / (722) / (1077) / (1402)

Base: Those who have purchased watermelon in the past 12 months

WATERMELON PURCHASERS
AWARE OF WATERMELON HEALTH BENEFITS
Yes
% / No
%
(h) / (i)
Bought watermelon / 83 b / 73
BASE / (1102) / (2026)

Base: Those who have purchased watermelon in the past 12 months

a-i-Significantly different at the 95% confidence level

TYPE OF WATERMELON PURCHASED MOST OFTEN

  • “Whole” watermelon is the type purchased most often by more than 7 in 10 of the respondents (71%), followed at significantly lower levels by “sections or slices” (18%), with less than 1 in 10 buying “minis” or “cubes” (6% and 5%, respectively).
  • Less educated respondents and those living in rural areas reportedly purchase “whole” watermelon most often - - significantly higher compared to college graduates and shoppers living in urban areas, while consumers without children living at home and those living in urban areas are buying more “sections or slices” vis-à-vis their counterparts, with more affluent consumers heavy purchasers of “cubes”.

TYPE OF WATERMELON PURCHASED MOST OFTEN
Domestic
2006
%
Whole watermelon / 71
Sections or slices of watermelon / 18
Mini watermelon (a watermelon the size of a cantaloupe) / 6
Watermelon cubes / 5
BASE / (387)

Base: Those who purchased watermelon in past 12 months (question added in August)

Q.1b. And, which of the following types of watermelon do you purchase most often?

TYPE OF WATERMELON PURCHASED MOST OFTEN
EDUCATION / INCOME / HAVE MINOR CHILDREN LIVING AT HOME
<Coll.
Grad.
% / Coll. Grad+
% / <$50K
% / $50K - <$75K
% / $75K+
% / Yes
% / No
%
(a) / (b) / (c) / (d) / (e) / (f) / (g)
Whole watermelon / 76 b / 63 / 73 / 73 / 65 / 80 / 72
Sections or slices of watermelon / 16 / 22 / 19 / 20 / 17 / 10 / 21 f
Mini watermelon (a watermelon the size of a cantaloupe) / 5 / 8 / 6 / 5 / 5 / 6 / 3
Watermelon cubes / 3 / 7 / 3 / 2 / 12 cd / 5 / 3
BASE / (213) / (156) / (135) / (55) / (98) / (163) / (154)

Base: Those who have purchased watermelon in the past 12 months (question added in August)

TYPE OF WATERMELON PURCHASED MOST OFTEN
LOCATION
Urban
% / Rural
%
(h) / (i)
Whole watermelon / 64 / 83 h
Sections or slices of watermelon / 23 i / 10
Mini watermelon (a watermelon the size of a cantaloupe) / 8 / 3
Watermelon cubes / 6 / 3
BASE / (226) / (87)

Base: Those who have purchased watermelon in the past 12 months (question added in August)

a-i-Significantly different at the 95% confidence level

INFLUENCE OF CHILDREN ON WATERMELON PURCHASING

  • Children have an impact on watermelon purchases, as about four-fifths of the respondents (who have children living at home) mentioned that their children have at least some influence when shopping (domestic – 79% vs. Toronto – 85%).
  • In addition, children “greatly influence the purchase” of watermelon among frequent summer purchasers (2-3 times a month or more) - - significantly more than consumers who buy watermelon once a month or less in the summer (48% vs. 32%).

INFLUENCE OF CHILDREN ON WATERMELON PURCHASING
Domestic
2006
% / Toronto
2006
% / Domestic
2004
%
(a) / (b) / (c)
Greatly influence purchase / 43 / 51 / 41
Somewhat influence purchase / 36 / 34 / 35
Do not influence purchase at all / 20 / 13 / 24 ab
Don’t know/refused / 1 c / 2 / -
BASE / (902) / (88) / (1160)

Base: Those who have children living in their household and have bought watermelon in the past 12 months

a-c-Significantly different at the 95% confidence level

Q.41. How much do your children influence watermelon purchases? Would you say they…?

INFLUENCE OF CHILDREN ON WATERMELON PURCHASING
SUMMER PURCHASE FREQUENCY
2-3 times a month or more
% / Once a month or less
%
(a) / (b)
Greatly influence purchase / 48 b / 32
Somewhat influence purchase / 34 / 41 a
Do not influence purchase at all / 17 / 26 a
Don’t know/refused / 1 / 1
BASE / (610) / (290)

Base: Those who have children living in their household and have bought watermelon in the past 12 months

a-b-Significantly different at the 95% confidence level
REASONS FOR BUYING WATERMELON

  • Aside from “tasting good”, at least 9 in 10 of the respondents purchased watermelon in the past year because - - “it’s cool/refreshing/juicy” (95%), “it’s in season” (93%), “it’s a good snack” (91%) and “it’s healthy and nutritious” (90%), while “using it as an ingredient in a recipe” was mentioned the least (21%).
  • In addition, domestic respondents purchase watermelon significantly more than their counterparts in Torontobecause “it’s in season” (93% vs. 87%), “it’s a good snack” (91% vs. 80%) and “it’s for a picnic, party or special occasion” (76% vs. 69%), while buying it “for my family/my kids” is significantly lower (85% vs. 94%).

REASONS FOR PURCHASING WATERMELON
Domestic
2006
% / Toronto
2006
% / Domestic
2004
%
(a) / (b) / (c)
Tastes good/I like to eat it / 95 / 96 / 97 a
It’s cool/refreshing/juicy / 95 / 96 / 96
It’s in season / 93 b / 87 / 93 b
It’s a good snack / 91 b / 80 / 90 b
It’s healthy and nutritious / 90 / 87 / 90
It looked fresh/appealing / 88 / 89 / 87
My family/kids like it / 85 / 94 ac / 86
It’s fun to eat / 82 / 81 / 82
It’s a good value / 81 / 84 / 81
For a picnic, party or special occasion / 76 b / 69 / 82 ab
I saw a large display at the store / 62 / 56 / 60
When there is an advertised or promotional price / 50 / 50 / 55 a
Given a sample in the store / 31 / 34 / 33
To make a carving / 23 / 29 / 25
To use as an ingredient in a recipe / 21 / 24 / 20
BASE / (2400) / (200) / (2400)

Base: Those who purchased watermelon in past 12 months

a-c-Significantly different at the 95% confidence level

Q.2. For which of the following reasons do you buy watermelon?

REASONS FOR BUYING WATERMELON (BY REGION)

  • “It tastes good/I like it” and “it’s a good snack” are played back as reasons for purchasing more watermelon by respondents living in the Great Lakes, while “it looks fresh/appealing” and “my family kids like it” is mentioned more frequently by consumers residing in the Plains states, with “it’s for a picnic, party or occasion”also mentioned at high levels by purchasers in both of these regions.

REASONS FOR BUYING WATERMELON (BY INCOME)

  • More affluent consumers purchase watermelon because their “family/kids like it” - - significantly higher than their counterparts, while lower income earners mention the following reasons at higher levels - -
  • “it’s cool/refreshing/juicy”
  • “it’s a good snack”
  • “it’s a good value”
  • “it’s fun to eat”
  • “I saw a large display at the store”
  • “it was offered at a advertised/promotional price”

1

REASONS FOR BUYING WATERMELON
REGION / INCOME
CA
% / West
% / Plains
% / South Central
% / Great Lakes
% / Mid-South
% / Southeast
% / Northeast
% / < $50K
% / $50 - <$75K
% / $75K+
(a) / (b) / (c) / (d) / (e) / (f) / (g) / (h) / (i) / (j) / (k)
Tastes good/Like it / 95 / 93 / 94 / 96 / 98 bcg / 95 / 93 / 95 / 95 / 95 / 96
Cool/refreshing/juicy / 97 / 94 / 96 / 95 / 96 / 95 / 96 / 95 / 97 k / 96 / 95
It’s in season / 93 / 92 / 94 g / 93 / 93 g / 95 g / 89 / 94 g / 94 / 94 / 91
A good snack / 89 / 89 / 92 / 91 / 94 ab / 92 / 91 / 92 / 93 k / 92 / 90
Healthy & nutritious / 89 / 89 / 91 / 91 / 90 / 92 h / 88 / 87 / 92 / 92 / 89
Looked fresh/appealing / 86 / 86 / 92 ab / 87 / 88 / 90 / 88 / 88 / 90 / 89 / 87
Family/kids like it / 87 / 84 / 89 dfg / 84 / 86 / 83 / 83 / 87 / 81 / 88 i / 90 i
For a picnic, party, occasion / 74 / 76 / 81 dfg / 73 / 83 adfg / 70 / 74 / 80 f / 77 / 79 / 75
A good value / 81 / 80 / 83 g / 80 / 85 g / 80 / 76 / 81 / 84 k / 84 k / 75
Fun to eat / 83 / 80 / 82 / 83 / 82 / 86 / 82 / 81 / 87 k / 84 / 80
Saw a large display at store / 68 fg / 60 / 63 / 61 / 66 fg / 58 / 58 / 61 / 67 jk / 60 / 61
Advertised/promotional price / 52 g / 51 / 50 / 48 / 57 dg / 50 / 43 / 50 / 55 k / 50 / 46
Given sample in store / 37 beh / 24 / 34 b / 40 befgh / 27 / 30 / 30 / 29 / 35 / 30 / 31
To make a carving / 25 b / 17 / 23 / 24 b / 26 b / 19 / 24 b / 26 b / 25 / 25 / 21
To use as an ingredient / 23 / 20 / 21 / 21 / 25 g / 23 / 17 / 21 / 24 / 20 / 20
BASE / (300) / (300) / (300) / (300) / (300) / (300) / (300) / (300) / (769) / (382) / (591)

Base: Those who purchased watermelon in past 12 months