1. 2017 Regional Segmentation
Avocado Shopper Segmentation: Segment Dynamics by Region
Region-by-Region Insights and Opportunities for Hass Avocados

2. Table of Contents Terms and Definitions 3 Introduction 5 Methodology 6
Executive Summary 8
Segmentation by Purchase Level 10
Total U.S. Shopper Trends and Regional Comparisons
Shopper Trends by Region 16
California 17
Great Lakes 19
Midsouth 21
Northeast 23
Plains 25
South Central 27
Southeast 29
West 31

3. Terms and Definitions Regions: Shopper Segmentation:
Total U.S., California, Great Lakes, Midsouth, Northeast, Plains, South Central, Southeast and West
Shopper Segmentation:
By Purchase Level (Super Heavy, Heavy, Medium, Light) – See page 6 for methodology and definitions
Metrics: All figures in this report are rounded
Annual Spend per Avocado Household – Average annual spend on avocados per avocado buying household. Annual Spend = Number of Trips X Spend per Trip
Number of Trips – Average annual avocado purchase occasions per avocado buying household
Spend per Trip – Average avocado dollar spend per purchase occasion
Purchases – Throughout this report, “purchases” refers to dollar purchases. Volume/units/eaches are not available
Shoppers – Throughout this report, “shoppers” refers to households that purchase avocados
Category Development Index (CDI) – Region’s share of Total U.S. avocado volume relative to its share of Total U.S. population. See page 5 for more information
Time Periods:
Current Year (CY) – 2016 Calendar year
Prior Year (PY) – 2015 Calendar year
Source Data:
IRI Consumer NetworkTM 2016 (Details on page 4)

4. Data Source: IRI Consumer NetworkTM
This report is based on household purchasing data from the IRI Consumer NetworkTM. IRI receives its household purchasing data from the National Consumer Panel (NCP), an operational joint venture by IRI and Nielsen. The NCP is a continuous household purchasing consumer panel that consists of a representative sample of U.S. households who electronically record all purchases. Households are recruited to the NCP and are incented to record all of their purchases, regardless of where purchased, using a handheld in-home scanning device.
Household purchasing data complements retail sales data and provides a deeper understanding of category dynamics by focusing on shoppers and their purchase behaviors. In turn, understanding shopper purchase behaviors helps uncover opportunities for growth and aids in effective sales and marketing decisions.
Electronically recorded at home
In-store purchases

5. Introduction Objective Category Development Index (CDI):
The objective of this study is to map the location and concentration by region of the four avocado shopper segments (Super Heavy, Heavy, Medium and Light) and understand their relationship to category development. In turn, this study aims to identify actionable, data-based opportunities for Hass avocados, based on the regional avocado purchase trends of each of these four shopper groups.
Category Development Index (CDI):
The Category Development Index measures each region’s share of Total U.S. avocado volume compared to its share of Total U.S. population*:
The avocado category is not equally developed across all regions
The avocado category is highly-developed in West, South Central, and California, while the category is continuing to emerge in the other regions
What can regional shopper purchase trends tell us about these different levels of category development and how can these trends reveal opportunities for greater development?
Category Development Index (CDI)*
≤ 80 = Low
= Par
≥ 120 = High
Data Source: IRI/Freshlook POS Data – 52-weeks ending
*Example: At 160, West avocado volume share is +60% higher than West population share

6. Study Methodology – Step One Shopper Segmentation
This study analyzed avocado shopper behavior at the Total U.S. level and in each IRI region* using a two step process.
Step One:
The study conducted a segmentation by grouping avocado shoppers into four segments. Shopper households were ranked according to each household’s total annual avocado spend (high to low). This ranked list was then divided into four equal segments (quartiles). The definitions of each segment are as follows:
Top-spending quartile (Super Heavy): Spent $25.36 or more annually on avocados ($66.38 on average)
Second highest-spending quartile (Heavy): Spent between $9.78 and $25.35 annually ($16.16 on average)
Third highest-spending quartile (Medium): Spent between $3.69 and $9.77 annually ($6.26 on average)
Lowest-spending quartile (Light): Spent $3.68 or less annually ($1.85 on average)
Avocado Households by Segment
Total U.S.
*Map of IRI regions provided on page 5

7. Study Methodology – Step Two Analysis of Segment Purchase Trends by Region
Using the definitions of each segment at the Total U.S. level, the study then mapped the location and prominence of shoppers in each of the four segments in each region. Once located by region, the purchase trends of shoppers within each segment were analyzed, and compared to the region’s CDI (page 5) to uncover regional insights and opportunities for Hass avocados
Total U.S.
= Segment shares of avocado shoppers

8. Executive Summary INTRODUCTION
The avocado category has achieved widespread success across the U.S., outpacing many other fresh produce categories. However, while avocados are available across all regions, the category is not equally developed in each region. When each region’s share of Total U.S. avocado sales is benchmarked against its share of Total U.S. population, the regions span a spectrum from highly developed to still emerging. For example, with a category development index (CDI) of 160, West’s share of avocados is 60% higher than its share of population. The avocado category is highly developed in the West. In contrast, Great Lakes, with an avocado CDI of 66, is at the other end of the spectrum, with avocado share running 34% below the region’s share of population.
This study finds new insights and new growth opportunities for developed and emerging regions by bringing together these avocado CDI metrics with the underlying avocado shopper purchase patterns in each region. This unique analysis sheds light on category growth drivers and distinct growth opportunities in each region.
HIGHLIGHTS
Current shopper data shows that just over half of all U.S. households purchase avocados (52.2% penetration). However, this study found that penetration varies by region, with California (70.6%), West (65.2%) and South Central (62.3%) topping the penetration rankings just as they top the CDI rankings. Regions with lower household penetrations also have lower CDI’s. This alignment between penetration and CDI highlights the importance of bringing additional households to the category (increasing household penetration) to drive further category growth and development.
Continued next page…

9. Executive Summary – Cont.
The shopper purchase metrics studied also include a new shopper segmentation by region. Viewed nationally, one of four avocado shoppers (Super Heavy segment) accounts for nearly three of four avocado purchase dollars. This study found, however, that Super Heavy shoppers are not distributed equally (or proportionally) across the regions. The three regions with the highest concentrations of Super Heavy avocado shoppers, California, West and South Central, also have the highest CDI’s. Regions with lower concentrations of Super Heavy avocado shoppers also have lower CDI’s. This shows that Super Heavy avocado shoppers are a driving force, and moving more shoppers to the Super Heavy purchase level should be a clear target for category growth strategies.
Avocado purchase frequency is another category development driver. In the regions with high CDI’s, shoppers purchased avocados an average of 7* or more times per year. In the regions with average or low CDI’s, trip frequency was less than 5.6* per year. This finding highlights the importance of executing growth strategies aimed at increasing avocado trip frequency.
By examining the purchase patterns for each of the four shopper segments in each region (Super Heavy, Heavy, Medium, Light) this study uncovers specific, actionable growth opportunities for each region. By way of example: the Northeast is a large avocado market, yet the avocado category is not as well developed vs. its population share (low CDI), indicating strong potential for additional category growth. This study found that Northeast has below-average penetration, and that Super Heavy shoppers in the region have the second- lowest trip frequency. Attracting new households, and driving more purchase trips, are key growth opportunities for this region.
The findings noted in this Executive Summary are a small sampling of the many insights detailed in this report. Each individual regional section provides an analysis of the region’s shopper trends and concludes with actionable opportunities for growth.
*Rounded

10. Total U.S. shopper trends and Regional comparisons

11. Category Household Penetration is a key driver of Category Development
High Penetration
Penetration %
Region Name
CDI
Low Penetration
A greater percentage of households in regions with high category development (California, West and South Central) purchase avocados than in the remaining regions
Category household penetration in California (70.6%), West (65.2%), and South Central (62.3%) is higher than the Total U.S. average (52.2%)
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded)

12. Regions with the greatest concentrations of Super Heavy and Heavy shoppers have the highest CDI
Avocado Households by Segment
Total U.S.
Category Development Index (CDI):
138
160
142 74 74 84 66 82
Shoppers in the four segments are not distributed equally across the eight geographic regions
The top three regions in CDI (California, West and South Central) have the highest concentration of Super Heavy and Heavy shoppers
Plains has the smallest concentration of Super Heavy and Heavy shopper households
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded)

13. Super Heavy and Heavy shoppers account for a larger share of purchases in high CDI regions
Total U.S. = $1,437.9
Category Development Index (CDI):
138
160
142 74 74 84 66 82
Dollar purchases in millions:
$271.6
$233.0
$211.8
$224.0
$123.3
$153.5
$154.1
$66.6
Shopper purchases in the four segments are not distributed equally in each of the eight geographic regions
Super Heavy and Heavy shoppers account for a larger share of purchases in the top three CDI regions (California, West and South Central)
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded)

14. Average spend per household (All Shoppers) is highest in regions with high CDI
138
160
142 74 84 66 74 82
In California, the average annual spend per household of $29.09 is +70% higher than the Plains spend rate of $17.10
California also has the highest Super Heavy annual spend rate at $71.29
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded). Annual Spend per Household = # of Trips X Spend per Trip

15. High purchase frequency is driving the higher annual spend in the high CDI regions
Spend per Trip by Segment
Purchase Trips by Segment
All Shoppers
CDI:
138
160
142 74 84 66 74 82
All Shoppers
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded). Annual Spend per Household = # of Trips X Spend per Trip

16. shopper Trends by region

17. California CDI: 138 Category Household Penetration
Avocado Households by Segment
Avocado Purchases by Segment
California had the highest penetration of any region. More than two out of three (70.6%) households in California purchased avocados in 2016
Super Heavy and Heavy shoppers make up 61% of avocado shoppers in California and account for 94% of avocado purchases
California saw a shift in its shopper mix. The Medium segment gained +1.8 share points while the Heavy and Light segment lost share
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded)

18. California CDI: 138 Annual Spend per Avocado Household # of Trips
Spend per Trip
California’s Super Heavy shoppers are high spenders. Their annual spend per household ($71.29) is nearly three and a half times higher than the Heavy segment average ($16.13)
California’s Super Heavy shoppers purchase avocados nearly 15 times a year; more than twice as often as the Heavy segment and they spend nearly twice as much per trip ($4.81 vs. $2.58)
Shopper spend per household declined in all segments in California saw a drop in Super Heavy and Light spend per trip and saw a drop in Heavy and Medium purchase frequency
California Opportunity: California has the highest category penetration of any region. Retaining this high penetration and reversing the decline in buying rate across all segments are key opportunities in California
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded). Annual Spend per Household = # of Trips X Spend per Trip

19. Great Lakes CDI: 66 Category Household Penetration
Avocado Households by Segment
Avocado Purchases by Segment
Less than half (46.2%) of the households in Great Lakes purchased avocados in 2016
Super Heavy and Heavy shoppers make up 42% of avocado shoppers in Great Lakes and account for 88% of avocado purchases
Great Lakes saw a shift in its shopper mix. The Medium segment gained +1.4 share points, while the Light segment’s share declined -1.4 points
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded)

20. Great Lakes CDI: 66 Annual Spend per Avocado Household # of Trips
Spend per Trip
In Great Lakes, Super Heavy shoppers make up the smallest shopper segment (19% of shoppers – P.19), but their annual spend per household is four times higher than the Heavy segment
Higher Super Heavy annual spend per household is driven by higher purchase frequency and spend per trip.
Super Heavy shoppers saw a decline in spend per household (-4.3%), due to a drop in their spend per trip (-8.7%)
Great Lakes Opportunity: Great Lakes has below average penetration and has the third-lowest buying rate of any region. Growing penetration and building buying rate for all segments are key opportunities for Great Lakes
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded). Annual Spend per Household = # of Trips X Spend per Trip

21. Midsouth CDI: 74 Category Household Penetration
Avocado Households by Segment
Avocado Purchases by Segment
Less than half of the shopper households in Midsouth (44.4%) purchased avocados in 2016, but the percentage of households increased +2.1 points vs. prior year
Super Heavy and Heavy shoppers make up 45% of avocado shoppers in Midsouth and account for 88% of avocado purchases
Midsouth saw a shift in its shopper mix. The Super Heavy segment gained +1.0 share point, while the Medium segment’s share declined -1.9 points
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded)

22. Midsouth CDI: 74 Annual Spend per Avocado Household # of Trips
Spend per Trip
In Midsouth, Super Heavy shoppers make up the smallest shopper segment (20% of shoppers – P.21), but their annual spend per household is three and a half times higher than the Heavy segment
Super Heavy annual spend per household declined slightly in Midsouth, driven by a drop in spend per trip All other segments saw an increase in annual spend per household
Midsouth Opportunity: Midsouth has the second-lowest penetration and lowest Super Heavy buying rate of any region. Bringing new buyers into the category and building annual spend for all segments are key opportunities for category development in Midsouth
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded). Annual Spend per Household = # of Trips X Spend per Trip

23. Northeast CDI: 74 Category Household Penetration
Avocado Households by Segment
Avocado Purchases by Segment
Less than half of the shopper households in Northeast (45.9%) purchased avocados in 2016, but the percentage of households grew slightly, up +0.3 points vs. prior year
Super Heavy and Heavy shoppers make up 48% of avocado shoppers in Northeast and account for 91% of avocado purchases
The share of Super Heavy shoppers in Northeast declined -1.0 point in 2016
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded)

24. Northeast CDI: 74 Annual Spend per Avocado Household # of Trips
Spend per Trip
In addition to the decline in Super Heavy share of households (P.23), the segment saw a decline in annual spend per household. Super Heavy household annual spend declined due to a drop in their spend per trip (-10.1%). Despite these declines, Super Heavy spend per household was more than three times higher than the Heavy spend
The Heavy segment saw an increase in spend per household (+1.6%), driven by an increase in spend per trip (+6.6%)
Northeast Opportunity: Northeast has below average penetration and the second-lowest Super Heavy purchase frequency of any region. Attracting more shoppers to the category and increasing Super Heavy purchase frequency are key opportunities for category development in Northeast
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded). Annual Spend per Household = # of Trips X Spend per Trip

25. Plains CDI: 82 Category Household Penetration
Avocado Households by Segment
Avocado Purchases by Segment
Less than half of the shopper households in Plains (45.7%) purchased avocados in 2016, but the percentage of households grew +1.1 points vs. prior year
Super Heavy and Heavy shoppers make up 40% of avocado shoppers in Plains and account for 86% of avocado purchases
Plains saw a shift in its mix of avocado shopper segments. The share of Super Heavy and Medium shoppers declined, while the Light segment saw a significant increase in share (+4.5 points)
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded)

26. Plains CDI: 82 Annual Spend per Avocado Household # of Trips
Spend per Trip
Despite their decline in share of households (P.25), the Super Heavy segment saw a significant gain in spend per household (+9.9%), driven by an increase in purchase frequency (+16.5%)
Plains saw an increase in annual spend per household for all shopper segments
Plains Opportunity: Plains has the third-lowest penetration of any region. Plains also has the lowest buying rate of any region, due to its low proportion of Super Heavy shoppers. Attracting more shoppers to the category in Plains and moving shoppers up the ladder are key opportunities for category development in Plains
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded). Annual Spend per Household = # of Trips X Spend per Trip

27. South Central CDI: 142 Category Household Penetration
Avocado Households by Segment
Avocado Purchases by Segment
Nearly two out of three (62.3%) South Central households purchased avocados in 2016
Super Heavy and Heavy shoppers make up 54% of avocado shoppers in South Central and account for 92% of avocado purchases
South Central saw a shift in its shopper mix, with the Super Heavy and Lights segments gaining share at the expense of the Heavy and Medium segments
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded)

28. South Central CDI: 142 Annual Spend per Avocado Household # of Trips
Spend per Trip
In South Central, Super Heavy shopper spend per household increased (+3.5%) in addition to their gain in share of households (P.27)
Super Heavy spend per household ($63.66) was nearly four times higher than Heavy ($16.27), driven by their higher purchase frequency (15.4 trips) and spend per trip ($4.12)
Annual spend per household increased for all shopper segments
South Central Opportunity: South Central has the third-highest penetration of any region. Retaining its high penetration and high proportion of Super Heavy households are key opportunities in South Central
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded). Annual Spend per Household = # of Trips X Spend per Trip

29. Southeast CDI: 84 Category Household Penetration
Avocado Households by Segment
Avocado Purchases by Segment
Less than half (43.7%) of the households in Southeast purchased avocados in 2016, up half a point vs. prior year
Super Heavy and Heavy shoppers make up 43% of avocado shoppers in Southeast and account for 89% of avocado purchases
Southeast saw an increase in the proportion of Super Heavy (+1.0 pt.) and Medium shoppers (+0.6 pts), while Light shopper share declined -1.8 points
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded)

30. Southeast CDI: 84 Annual Spend per Avocado Household # of Trips
Spend per Trip
In Southeast, all shopper segments saw an increase in annual spend per household
Super Heavy shoppers are particularly influential in Southeast. Their annual spend per household is nearly four and a half times higher than the Heavy segment, the greatest gap in any region
Southeast Opportunity: Southeast has the lowest penetration of any region and has a below average proportion of Super Heavy shoppers. Attracting new shoppers to the category and moving shoppers up the ladder are key opportunities for category development in the Southeast
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded). Annual Spend per Household = # of Trips X Spend per Trip

31. West CDI: 160 Category Household Penetration
Avocado Households by Segment
Avocado Purchases by Segment
Nearly two out of three (65.2%) West shoppers purchased avocados in 2016, down half a point vs. prior year
Super Heavy and Heavy shoppers make up 58% of avocado shoppers in West and account for 93% of avocado purchases
Heavy shopper share of households declined -1.3 points, while medium shoppers gained +1.5 share points
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded)

32. West CDI: 160 Annual Spend per Avocado Household # of Trips
Spend per Trip
In West, the Super Heavy segment saw a decline in annual spend per household (-5.9%), while all other segments saw gains in household spend. Despite this decline, Super Heavy annual spend per household ($64.88) was nearly four times higher than Heavy ($16.48)
West Opportunity: West has the second-highest category penetration, but saw a decline in penetration in West also saw a decline in its proportion of Heavy shoppers. Stemming the decline in penetration and moving shoppers back up the ladder are key opportunities in the West region
Data Source: IRI Consumer NetworkTM 2016 (All figures are rounded). Annual Spend per Household = # of Trips X Spend per Trip

33. Thank you
For additional retail information and insights please visit the Hass Avocado Board website at:
hassavocadoboard.com