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- [00:01]
Jessica Mendoza
The classic Thanksgiving combination, turkey, stuffing, and cranberry sauce. The jammy side dish will be on our plates today more than any other time of the year. And to shine a spotlight on the cranberries that make up this Thanksgiving staple, we're bringing back an episode we made last year. It's about the biggest cranberry company in the world, Ocean Spray. Enjoy and happy Thanksgiving. Our colleague Ben Cohen won't stop talking about cranberries.
- [00:33]
Ben Cohen
I was so fascinated by big cranberry, like, everything I learned about cranberries. I was just, like, going around to everyone last week being like, did you know this about cranberries?
- [00:42]
Jessica Mendoza
Yeah. You sound like you're becoming a cranberry.
- [00:44]
Ben Cohen
Stan, do you know what the top five selling cranberry products in 2022 were?
- [00:49]
Jessica Mendoza
I do not. Please enlighten me.
- [00:51]
Ben Cohen
Okay, number one, 60. I'm not gonna do it in order, actually, because I wanna save the best for last. 64 ounce cranberry juice cocktail. Okay. 100% cranberry juice is also on the list.
- [01:03]
Jessica Mendoza
Okay.
- [01:04]
Ben Cohen
64 ounce cranberry grape juice.
- [01:06]
Jessica Mendoza
Cranberry grape is a fan favorite. I would not have guessed that.
- [01:10]
Ben Cohen
3 liters cranberry juice cocktail. So the 3 liters and the 64 ounce both make it on the list. And then also on the list, 14 ounce jellied cranberry sauce. That good old classic.
- [01:22]
Jessica Mendoza
And this week is huge for that good old classic canned cranberry sauce.
- [01:28]
Ben Cohen
They really do appear on the table of, like, every home in America during Thanksgiving. It's like, you know, this thing, like, pops up out of nowhere once a year. And it has this place in all of our hearts and, you know, maybe some of our stomachs.
- [01:44]
Jessica Mendoza
The company that invented it is Ocean spray. It does $2 billion in cranberry sales a year, and it produces 65% of the cranberries in the world. The ingredients to its success include 700 families, a major berry panic, and some very hip grandmas. Welcome to the Journal, our show about money, business, and power. I'm Jessica Mendoz. Up on the show, the company behind your can of cranberry sauce.
- [02:32]
Sean Cutts
This episode is brought to you by Empower. If you're like most people, you've got your fair share of financial questions. Questions like, will we be able to afford having a third kid? Will we be able to do everything we want when we retire? What if we outlive our savings? Empower knows these questions can be stressful, but they'll help answer your what ifs? And Empower, what's Next? So join 18 million Americans and take control of your financial future with Empower.
- [02:59]
Jessica Mendoza
Start today@empower.com this episode is brought to you by AARP. They have reskilling courses and career tools to help your income live as long as you do. The younger you are, the more you need AARP. Learn more at aarp.org skills Sean Cutts is a cranberry farmer in the Pine Barrens of southern New Jersey. He worked there for his father when he was younger, and now he works with his own kids. Do you have a favorite time, like, of the. Of the season?
- [03:36]
Sean Cutts
You know, to me, October is the most beautiful month of the year. You know, it's fall. The weather is beautiful, the leaves are starting to turn. And then when you have a cranberry bog that's just covered in crimson fruit floating on top, there's really not much more beautiful than that, in my opinion.
- [03:54]
Jessica Mendoza
Shawn's family have been cranberry farmers since 1901. They work pretty much all year long, from winter to fall.
- [04:02]
Sean Cutts
In the wintertime, the bogs are flooded to protect the cranberry vines. And then in April, we drain the flood, and the cranberries stay dry for the rest of the growing season until we harvest.
- [04:14]
Jessica Mendoza
What's the Thanksgiving season like for you?
- [04:18]
Sean Cutts
Well, the Thanksgiving thing, we're kind of winding down from the harvest. We've got a few little fall jobs that we do cleaning our ditches and such, but we're pretty much in recovery mode for our family. Harvest is seven days a week, and it's night and day for a month straight. And so by the end, we're pretty wiped out. Hopefully we're still all, you know, talking to each other and whatnot. But the month of November is a good time for us to rest a little bit and gather together as a family and be thankful for our blessings.
- [04:53]
Jessica Mendoza
Sean's farm is part of Ocean Spray, which works a little differently than your average food conglomerate.
- [05:00]
Sean Cutts
So Ocean Spray is a cooperative, which means that it is owned by the growers. And in the case of Ocean Spray, the growers are about 700 family farms scattered across North America.
- [05:13]
Jessica Mendoza
Those families are the company's shareholders. Fourteen growers make up the board of directors, and they hire the executives that run the business. Here's our colleague, Ben again.
- [05:23]
Ben Cohen
So I think the best way to think about it is that these people grow the cranberries, and then they hire people to grow the business. And what that really means is that in a cooperative, every cent of profits goes back to the farmers.
- [05:39]
Jessica Mendoza
Ocean Spray has been set up this way Almost from the beginning. How did Ocean Spray get started?
- [05:46]
Ben Cohen
Ocean Spray was started in 1930 by three farmers who Ocean Spray today calls three maverick farmers. One of them felt this frustration, which is that there was really no way to sell cranberries year round. He ends up coming up with this sort of brilliant invention, which is cranberry sauce in a can. And it turns out the market for canned products was so large and the competition among cranberry farmers was so fierce that a few of them decided that they were sick of competing with each other and they would band together. And so 1930 brings the ocean Spray cooperative, and that was really the beginning of this company that dominates the market for Thanksgiving cranberries today.
- [06:37]
Jessica Mendoza
You can see why the families, these farmers, would prefer this model. But you mentioned that, you know, this company and these families, as a result, are sort of responsible for growing a majority of the cranberries in the world. How is that not a monopoly?
- [06:55]
Ben Cohen
The reason why Ocean Spray is able to exist and the reason why there are many agricultural cooperatives, from the Dairy Farmers of America to Land O'LAKES to Blue Diamond Almonds. The reason they're able to operate is because of a law passed in 1922 which essentially exempts these agricultural cooperatives from monopoly and antitrust practices.
- [07:20]
Jessica Mendoza
For the first 30 years, Ocean Spray's business was pretty successful, but it relied almost entirely on one day. Thanksgiving. I'm ready to talk about the great Cranberry scare of 1959. What was that? What happened?
- [07:36]
Ben Cohen
Okay, the great Cranberry scare of 1959. This topic that should have inspired competing Netflix and Hulu docs by now. And I'm shocked that it hasn't. 1959, Thanksgiving is still the cash cow for Ocean Spray. One day in 1959, early November, federal government finds that a batch of cranberries in Oregon and Washington has trace amounts of an herbicide linked to cancer in lab rats. So now, you know, suddenly, instead of looking at cranberries and seeing all the health benefits, people are walking down grocery market aisles and seeing cancer when they think of cranberries. Right. It was really a wake up call for this business cooperative. What they realized was that they could no longer be so reliant on selling one product for a single day of the year. And in order to survive, it would have to innovate, it would have to develop new products, and it would have to diversify beyond jellied cranberry sauce in a can for Thanksgiving.
- [08:41]
Jessica Mendoza
And so what did they wind up inventing a lot of stuff.
- [08:48]
Ben Cohen
Basically every use of Cranberry has been invented since the great Cranberry scare of 1959. So in the early 1960s, they bring out their first juice blend, Ocean Spray Cran Apple. Not too sweet, not too tart, with lots of vitamins. In the early 1980s, Ocean Spray is the one leading the charge on bringing juice boxes into our stores. Ocean Spray proudly presents the package of.
- [09:14]
Jessica Mendoza
The future today, the paper bottle with a cranberry apple drink.
- [09:18]
Ben Cohen
Cranberry 1990s. They come out with possibly like, you know, the most lucrative innovation in the history of the cranberry industry, which is dried and sweetened cranberries that we know as Craisins.
- [09:32]
Jessica Mendoza
Craisins, the sweetest way to eat a cranberry. Ocean Spray was figuring out how to capture a bigger market. But for its growers, a major decision was on the horizon. That's next. In 2004, the giant food corporation PepsiCo offered to buy a 50% stake in Ocean Spray. That would mean a big payday for the growers, but a potentially huge change in how the company worked. The co op put it to a vote. Sean Cutts, the cranberry farmer, was just out of college at the time.
- [10:24]
Sean Cutts
Those of us who have future generations that we envision coming into the business in the future, we're generally in favor of keeping the brand as a co op simply because even though we would have gotten a nice payout upfront, long term, that's probably not what was best for our farms. And one of the great things about the cooperative for us farmers is because we own it, we keep all the profits.
- [10:55]
Jessica Mendoza
But there was something attractive about the offer from PepsiCo. Here's Ben.
- [10:59]
Ben Cohen
A lot of the farmers were actually quite interested in this proposal because they wanted to broaden product distribution and just generally have the scale that it's really hard for like 700 cranberry farmers to accomplish on their own. It was an existential vote for the future of this company, of this cooperative that had such an interesting past. And so the vote was a 52:48 split in favor of remaining farmer owned and independent, but really close, about as close as you can get. And I think it took a long time for the cooperative to recover from that split.
- [11:39]
Jessica Mendoza
Since that vote, Ocean Spray has stuck with the co op model, though it did eventually partner with PepsiCo for marketing. Today, Ben says Ocean Spray is focused on a future full of cranberries.
- [11:52]
Ben Cohen
In recent months alone, they have unveiled a zero sugar juice line. They have a deal with Hershey's to produce chocolate dipped in cherry infused craisins. They have a deal with Absolute for ready to drink Cranberry vodka. Vodka cranberry.
- [12:13]
Jessica Mendoza
And it sounds like, as you say, the Ocean Spray has really expanded beyond Thanksgiving. But how much of their business still relies on the holiday?
- [12:23]
Ben Cohen
They've never relied on the holiday less than they do today. So, you know, what percent of the business is Thanksgiving? It's really hard to say. It's a private company. They don't have to reveal financials. You know, I talked to one cranberry farmer who said that when he was growing up, Thanksgiving and Christmas was, like, 100% of their business. And today he said that it's like 5% of where their crop goes. So it is no longer about selling one product on one day. It is about selling a whole bunch of cranberry products every day of the calendar.
- [12:59]
Jessica Mendoza
Do they still see it as the most important day in the business, though?
- [13:04]
Ben Cohen
They still call it their Super Bowl? Yes. It used to be like the entire football season wrapped up into one day, and now it's just one day.
- [13:13]
Jessica Mendoza
And so are there any threats on the horizon? Any challenges?
- [13:17]
Ben Cohen
You know, when I asked Tom Hayes, the CEO of the company, he said, you know, one of the great things about Ocean Spray is that it's like a company that thinks in family generations and not financial quarters. Right. Like, the average farm in the Ocean Spray cooperative has been passed down between two and three generations. But there are some drawbacks. Like, if they want to go out and acquire a company, they don't necessarily have the access to capital that they would if they were a public company or if they had shareholders who were not cranberry farmers. Right, right.
- [13:53]
Jessica Mendoza
Because they do have that one product, like you said. But it is interesting to think about how that might limit innovation, which sounds like is crucial to their survival in the next century, for sure.
- [14:05]
Ben Cohen
I mean, you know, one of the cranberry farmers told me, like, we are a single threat company. I feel like every company these days is like, we're a double threat. We're a triple threat. This is a company that does one thing, and it has to keep finding ways to do that one thing.
- [14:20]
Jessica Mendoza
Product innovation is one part of that. Reaching more consumers is another.
- [14:25]
Ben Cohen
One way that Ocean Spray is trying to get younger, or at least appeal to younger consumers, is through its marketing and being a little bit more edgy in the way that it presents these very old products. Ocean Spray had this viral marketing moment in 2020 where a guy, his car broke down on the way to work, and he filmed himself skateboarding to work, singing Fleetwood Mac, Fleetwood Mac song. Yeah. Dreams while swinging from a bottle of Ocean Spray.
- [15:06]
Jessica Mendoza
I remember that.
- [15:07]
Ben Cohen
Yeah, a lot of people do. It turns out this TikTok went so bananas that like they had this improbable sales bump that they saw at the company level and they took advantage of this marketing opportunity. They were like surprisingly nimble for a 90 year old company at the time. They sent the guy a cranberry colored pickup truck filled with Ocean Spray juice. The CEO of the company jumped on a skateboard himself and like filmed a copycat video to post on TikTok where he's drinking Ocean Spray and discovers how hard it is to skateboard while trying to drink from an open container of Ocean Spray.
- [15:45]
Jessica Mendoza
So Ocean Spray is using social to like carve out a spot at the kids table. But in a lot of ways, we still think of cranberry sauce as old fashioned. Like it makes you think of Jell O and your grandparents. So what has the company's strategy been this year?
- [16:03]
Ben Cohen
One way they're trying to get younger is by getting a whole lot older. So their marketing campaign for this year's Thanksgiving holiday is hiring two grandfluencers. Those are grandfluencers, influencers who are grandmothers.
- [16:17]
Jessica Mendoza
Grandmothers. Okay, food not allowed at my funeral. Homemade cranberry sauce. If you bring it in, I will haunt you. If you can't tell I'm team homemade cranberry sauce.
- [16:32]
Ben Cohen
Grandfluencers. And their whole campaign this year is are you team homemade or team canned? Right? Ocean Spray wins either way.
- [16:40]
Sean Cutts
Right?
- [16:40]
Ben Cohen
Like if you're team canned, you're buying Ocean Spray canned cranberry sauce. And if you're team homemade, you're buying Ocean Spray's cranberries to make that homemade sauce.
- [16:52]
Jessica Mendoza
So Ben, for Thanksgiving, don't ask.
- [16:55]
Ben Cohen
Don't do it. Don't do it.
- [16:56]
Jessica Mendoza
I gotta, I gotta. We can't not. Are you team canned or are you team homemade?
- [17:02]
Ben Cohen
You know, this is so embarrassing, but like, I don't even look at the cranberry sauce on our Thanksgiving table. And I knew you were going to ask that question. And I texted my sister before coming on saying, what do we even have at Thanksgiving? And she said, mom always makes homemade cranberry sauce.
- [17:17]
Jessica Mendoza
So your whole life, Ben, your mom has made homemade cranberry sauce.
- [17:23]
Ben Cohen
My mom is going to kill me when she hears this. This year, in the spirit of Thanksgiving and cranberry farmers everywhere, I will try the cranberry sauce on our table.
- [17:37]
Jessica Mendoza
This episode was originally published in November of 2023. The Journal is a co production of Spotify and the Wall Street Journal. Happy Thanksgiving. We'll be back with a new episode on Monday. See you.