Blue Diamond Comes Out of Its Shell

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The “Oprah” and “Dr. Phil” ads, which are still airing, take full advantage of recent studies that found almonds do not contain “bad fat” and may actually help reduce the risk of heart disease and diabetes. The 10-second ads show women at their jobs and say: “More than a Teacher” and “More than a Nurse,” and therefore they deserve Blue Diamond almonds, “More than a Snack.”

The football ads are centered on the “Nuttiest Play of the Week,” and the company has also gone virtual by cross-marketing consumer contests on its internet site. Winners can become “movie nuts” and get free tickets to the Oscar presentation and to private post-Oscar parties hosted by entertainers like Oprah and Elton John. It didn’t hurt sales when Oprah’s nutritionist endorsed almonds as a healthy food. The “one can a week” slogan is still being used, along with the pictures of friendly and smiling farmers nearly buried in almonds.

Although he would not release specific financial numbers, Youngdahl is emphatic that the expensive marketing campaign is working. “Absolutely, there is no question about it,” he says. “It’s a big reason our gross sales have tripled in the past four years. We’ve seen a direct response in terms of sales from both our television and our radio ads. If the campaign wasn’t working, we wouldn’t be planning to continue it into the foreseeable future.”

THE NUTTY GOSPEL

A less sexy, if perhaps equally important, reason for the company’s upswing is the campaign to hold a firm line against price reductions. Youngdahl, Shick and the other Blue Diamond representatives took to the road like preachers spreading the Gospel. The almond industry, they argued, would collapse if growers continued to cave in on their prices.

Blue Diamond’s prices were among the highest in history (in 2005 they topped $3 a pound), but buyers listened with sympathetic ears for two reasons. First, the weather was cooperating and crops were plentiful,  resulting in fair prices. Second, Blue Diamond enjoyed a top-tier reputation for quality, delivery and service.

Buyers wanted to continue to do business with the company, and they had confidence in Youngdahl and the board. Youngdahl also argues that future almond supplies depended on growers making a profit so funds could be set aside for new equipment and new trees (the productive lifespan of an almond tree is about 30 years). Even Blue Diamond’s competitors were impressed.

“We all benefited from what Blue Diamond has done in the past six years in terms of keeping prices strong,” says Bert Steir, VP of Paramount Farms, one of Blue Diamond’s largest competitors.

“So many farmers in America have to look to the government to bail them out because they can’t make a living. Blue Diamond made an amazingly bold move to hold its prices, because it is awful easy for its competitors to tell buyers, ‘Hey, we’ll give you the same service and products as Blue Diamond at a lower price.’ But they didn’t waver.”

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