Chiquita marketing could include flavored bananas

Lisa Cornwell

Thursday, July 1, 2004 | 9:23 a.m.

CINCINNATI -- Bananas flavored with the hint of another fruit could help Chiquita International Brands Inc. become the Starbucks of the produce world, the company's leader says, envisioning a larger, creamier or sweeter banana.

Chiquita has taken its bananas to the research lab as part of an effort to make the fruit more appealing to consumers -- and to persuade them to pay more, president and CEO Fernando Aguirre told the Associated Press in an interview.

For competitive reasons, the company would not specify flavors it is researching and declined to reveal how different sorts of bananas would be created other than to say the fruit would not be genetically modified.

"I have seen about eight and tasted four or five different types," Aguirre said of the flavored bananas. "Now we need to find out from consumers if this is relevant and whether it is something they would like to see and be willing to pay for."

The company hopes to test some of its new products in the United States or Europe within a year, Aguirre said in the interview.

Chiquita, which distributes and sells bananas and other fresh produce, along with fresh-cut fruit and other fruit products, in May reported a 20 percent drop in first-quarter earnings of $20 million -- despite a 68 percent sales increase.

Lower banana prices in North America and Europe partly offset some of the sales increase, and Aguirre has said that his No. 1 priority is to improve profitability in North America. He acknowledged that some of the progress in transforming the company has been slowed by having to deal with the company's admission in May that one of its subsidiaries made payments to groups in Colombia that the United States designated as foreign terrorist organizations.

Aguirre wants the Cincinnati-based company, which emerged from bankruptcy two years ago, to become more profitable by adapting fruit and new products to consumers' wishes.

"Who would have thought a few years ago before Starbucks started that we would be paying four or five bucks for a cup of coffee?" he said. "What we used to pay 50 cents for, we are paying 10 times more for now. I think if someone could do that for coffee, we ought to be able to do it with bananas."

The company also is looking at marketing existing varieties of bananas and has already had some success in Japan with a sweeter banana called a Highland.

Aguirre, 46, took the helm at Chiquita in January after 23 years in marketing and consumer research positions with his former employer, consumer products giant Procter & Gamble Co.

"Experience from a consumer products company will help us see what we can do with the produce aisle where nothing has changed much in the last 20 or 30 years," Aguirre said.

Marketing analyst Gary Stibel, another former P&G executive who now runs the New England Consulting Group in Westport, Conn., lauded Aguirre's aggressive focus on innovation.

"In a business that hasn't changed for thousands of years, he is aggressively attacking every aspect and will do more for the banana category in the next five years than we have seen in our lifetime," Stibel said. "Successful marketing is about changing the entire experience for consumers in new and unexpected ways, and Aguirre is trying to change the entire banana experience from a mundane category to one of excitement and adventure."