Berry Big Growth: Can You Believe this Berry Company Has Grown 15% Annually for 30 Years?
Driscoll’s berries are an intriguing growth strategy case study. In our family, we’re big berry eaters year-round, and are partial to strawberries, raspberries, and blackberries. Driscoll’s berries are part of our daily breakfast and occasional dessert routine, as in last night’s strawberry shortcake.
The company’s growth results placed them in the top performers in the 2020 CPG Growth Leaders from IRI and BCG. The brand grew 19% from 2019 to 2020 to sales of $2.6 billion. And, Driscoll’s has been consistently growing, ranking in the top growth leaders in 2018 and 2019 (prior to COVID impact). According to Driscoll’s CEO Miles Reiter, Driscoll’s has grown roughly 15% annually for more than 30 years.
Growth Strategy Case Study: Packaging and New Premium Varieties
This week, I was intrigued to find a package of Driscoll’s Berry Big Strawberries that my fiancé brought home. These berries are a lot larger than the typical, and each berry is carefully placed and displayed through the package window, similar to a box of fine chocolates. The packaging is also different, a rectangular box that’s light brown. Overall, it’s a premium look and sets up an expectation before even tasting that these will be delicious, and of course, large, berries.
Berry Big is premium-priced. A price check at Kroger.com shows that an 18-ounce package of Berry Big retails for $3.99, compared with $2.99 everyday pricing and two-for-$5.00 promoted pricing for 16-ounce regular-sized strawberries sold in traditional clamshell packages (not Driscoll’s branded). Instacart also shows $3.99 for Berry Big.
To support the premium pricing, Berry Big marketing also suggests more premium occasions, “Share ‘em, Dip ‘em, Slice em!” with situations like dipping in chocolate, and/or decorating the Berry Big. The packaging is also touted as 100% recyclable. Driscoll’s has made a number of sustainability pledges, focusing on water and plastics.
Using packaging for the growth strategy makes good sense. Packaging plays a meaningful role in consumer’s perceptions of how premium and high quality a product is. In packaged supermarket cookies, the definition of a premium cookie is a higher priced cookie in a smaller, premium package. For example, Pepperidge Farm’s signature Milano in their white, standup “bakery” bag priced at $3.99 for 7.5 ounces vs. mainstream-priced Chips Ahoy! at $3.71 for 18.2 ounces in a plastic tray with overwrap package.
Berry Big strawberry met our family’s expectation for a premium strawberry. Driscoll’s created a Consumer Advisory Panel with research that asked panelist consumers to rate each package on “taste/flavor, appearance, condition, and texture” on a 10-point satisfaction scale, with scores below six flagging issues. According to a recent interview, the company continues to work on this area, but the initial effort didn’t provide a sufficiently robust quantity of feedback.
Driscoll’s indicates that Berry Big is typically available only early in the summer season, and that they deliver against the organization’s high-quality standards of sweetness and visual appeal.
Along with Berry Big strawberries, Driscoll’s strawberry product portfolio also includes Sweetest Batch, along with the “classic yellow-label” and “organic green-label” varieties.
Recent trademark applications from Driscoll’s suggest other products. They include:
- BERRY BIG (fresh berries) 4/21/20
- SWEETNESS WORTH SHARING (fresh berries) 7/31/20
- ROSA% BERRIES 6/10/19
We can expect to see more examples of premium packaging and berries from Driscoll’s in the future.
Growth Strategy Case Study: Year-Round Supply of Berry Portfolio
Strategically, Driscoll’s prioritized year-round supply of strawberries, raspberries, blackberries and blueberries as essential to drive its growth. Winning with advantaged, quality year-round product supply has been a driving long-term growth strategy.
According to one source, Driscoll’s has about a third of the U.S. berry market. While the majority of their berries are grown by outsourced farmers, around one third of their fruit is grown by Driscoll’s family-related parties, in addition to over 750 independent growers in 20 countries, including Mexico, US, Chile and Peru. Of note, another recent interview mentioned over 1,000 independent growers.
Berry types other than strawberries have been important growth contributors. Soren Bjorn, President of Driscoll’s of the America shared in a December 2017 video interview that berry types beyond strawberries are also meaningful growth drivers.
“At Driscoll’s, our really big growth is coming from blackberries and blueberries, in particular, and we have some great new varieties that really have outstanding flavor. That together with our organic offer- which is growing much faster than conventional.”
Growth Strategy Case Study: Vertical Indoor Farming and Geographic Expansion
Driscoll’s is also actively exploring producing strawberries indoors, in a controlled environment. They are partnering with Plenty, with initial indoor Driscoll’s strawberries grown in Laramie, Wyoming.
Outside of the US, Driscoll’s has shared a goal to triple its berry business in China, specifically from 10,000 metric tons in 2020 to 30,000 metric tons in 2025.
“Over time, China potentially can be as big as, if not bigger than, the biggest fresh berry market in the world, which currently is the United States. The typical customer profile for Driscoll’s is female aged between 25 and 40 years old, who is keen on wholesome foods that have health benefits and taste good.”Jae Moon Chun, Driscoll’s VP and GM China
Growth Strategy Case Study: Success of Independent Growers
The success of independent farmer growers is also an important growth strategy. For instance, in May 2020, when foodservice demand for berries dropped, driven by schools, hotels, corporate catering and restaurants, Driscoll’s shifted as much product to retail as possible to avoid plowing fields under.
In a recent Food Tank interview,
“(CEO Miles) Reiter attributes this success to the company’s focus on elevating its workers and partners… Our mission is to continually delight consumers through alignment with customers and growers.”
Driscoll’s Director of Blackberry Leadership, Brie Reiter Smith explains the organization’s quality rewards system.
“You can get huge disparity in grower performance from a quality standpoint…quality rewards system…we look at samples of 85 to 100 percent of fruit, and assign a grade to it…the guys who delivered better quality throughout the week get a little bit more money than those who didn’t…For the past decade and a half…high score or low score was typically product being devoid of condition or defect, regardless of how ripe it was…Now with supply chain we can move product so fast, we realized a real shift in the marketplace, grapes and stone fruit…we decided to reprioritize flavor in our flavor program five years ago…in our reward system we also prioritized flavor. Those who meet condition and appearance criteria and deliver the ripest fruit get the most money every week.”
Driscoll’s Growth Strategy Case Study Summary
This growth strategy case study can be boiled down to a few key success factors. The growth strategies that result in Driscoll’s delivering 15% growth year after year are as follows:
- Overall Mission “Delight consumers through alignment with customers and growers”
- Growth through packaging and new premium varieties
- Growth through year-round supply of berry portfolio
- Growth through success of independent growers
- Relentless focus on product quality and delivery to end customer (e.g., Consumer Advisory Panel, rewards for product quality)
- Growth through vertical indoor farming and geographic expansion
One strategy we haven’t seen articulated, but may be in place, is a grower counsel or benchmark system. With a philosophy of letting growers do what they do best, this may not be comfortable.
At first, Driscoll’s may seem a surprising choice for a growth strategy case study. But this berry company is very strategic, and it’s interesting to see the product and packaging innovation in the produce category.