Will the authentic cranberry company step forward

4/12/01 Putting aside the internal workings of Ocean Spray and Nantucket Nectars, as far as the cranberry industry is concerned, the introduction of a new product which will have a high cranberry content in the important cooler section of the supermarket is good news as long as consumers buy more cranberry juice overall. ( The exact content of cranberry in the new Nantucket Nectars juice is unknown, but entire juice content is listed as only 15%, see ingredients.) Putting a cranberry juice that is formulated to have a texture and palate sensation more like orange juice right next to the refrigerated orange juices could very well lure some O.J. consumers into buying cranberry juice as well. Even if 10% of all regular orange juice drinkers picked up a 64 oz. carton of cranberry juice occasionally, the numbers would probably be significant. If it will sell more juice, this is a rationale for using the Ocean Spray logo, if not the brand itself.

The so-far unheralded introduction of a radically new cranberry juice, even in a test market, under the Nantucket Nectar's label raises some interesting questions about Ocean Spray. For example, who controls Nantucket Nectars? Ocean Spray growers will tell you that Ocean Spray owns most of the company, and in fact, Ocean Spray does own a majority share of Nantucket Nectars. (How much debt remains has not been made public, nor has what percentage is still owned by founders Tom First and Tom Scott.) According to the Nantucket Nectars web site "Ocean Spray has made a significant investment in Nantucket Nectars, but we remain an independent free standing company run by Tom and Tom. Nothing has changed. Ocean Spray will be able to offer our production team more efficient ways to produce and possibly distribute. Nantucket Nectars is still the same company it always has been." Presumably, if this is true, the two Toms are still running Nantucket Nectars and making all decisions.

While Ocean Spray is known primarily as a cranberry company, Nantucket Nectars is known for its single serve blends, and not only makes cranberry juice cocktail, but has just added a new product line in New England (see article) which includes a unique refrigerated cranberry juice. They call their juice, which has cranberry puree as an ingredient,  Authentic Cranberry.*

Ownership information about Nantucket Nectars is available. A thorough perusal of the Nantucket Nectars web site locates this information, although the fact doesn't seem to be on the Ocean Spray web site. The only subsidiary listed there is Milne Fruit Products, Inc. of Prosser, Washington. 

Much has been made of the value of the Ocean Spray brand name and logo. If Ocean Spray can veto a decision made by Tom and Tom, why are they allowing the company to go into competition with the Pepsi and Coke owned Tropicana, Dole and Minute Maid juices in the supermarket juice coolers? Welch's is there too, so is Chiquita, and at least here in New England, Newman's Own Lemonade. Why wouldn't it make more sense to put Ocean Spray on the label? Is it because the Ocean Spray marketers think that Ocean Spray's entry into this segment would detract from sales on the juice aisle, and using a surrogate is part of a well thought out plan to sell more cranberries?  Is it because Tom and Tom really do control Nantucket Nectars and Ocean Spray had no say in this matter? 

Or is it because Ocean Spray is attempting to increase the value of Nantucket Nectars for sale in the near future? If the later is true, there's a lesson to be learned from the sale of Mauna La'i. Simply put, don't sell an asset that another company, through arguably better marketing combined with changing consumer tastes and demographics, can turn into a gold mine. According to a recently published study by Dr. Nora Ganim Barnes,  male Gen X'ers are an untapped market for cranberry products and Nantucket Nectars would seem to have an appeal to them as a more modern label and company than Ocean Spray. (Compare the web sites of Ocean Spray and Nantucket Nectars to see how different these companies are.** Also, see the Stressline article on the hugely profitable re-sale of Mauna La'i by the insiders who bought it from Ocean Spray to Cadbury Schweppes here; and the Barnes paper here.)

The promotional images on their web site suggests that Authentic Cranberry will be the main focus of advertising for this entry by Nantucket Nectars into the cooler section. 

But wait. 

Isn't Ocean Spray the company that's supposed to be synonymous with cranberries, and doesn't Ocean Spray own most of Nantucket Nectars? 

What's going on here? 

Aren't the grower/owners of Ocean Spray just a little bit curious?

If Ocean Spray and Nantucket Nectars are really parts of the same company, a mutual goal should be to sell consumers more cranberry juice and eliminate the surplus while assuring market growth to keep pace with increased production. Why this new cranberry product is being marketed under the Nantucket Nectars label rather than the Ocean Spray label?

 * As a side issue, the name suggests there might be another company that sells an artificial cranberry product, or at least one that is less than authentic. 

** How different are the cultures of Ocean Spray and Nantucket Nectars? Read some of the material on the two Toms, Ivy Leaguers whose first job involved "removing doo-doo from yachts" in Nantucket Harbor, ( Brand Cities on Tom Scott, It's a dogs life at Nantucket Nectars, Bios of Tom and Tom from their web site ) and compare them with a profile of Ocean Spray CEO, corporate veteran Robert Hawthorne. 

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