Organic produce sales continue to climb. The benefits they offer may be up for dispute, but its clear that consumers recognize organics exist.
Organic produce has been getting a lot of “face” time in the media recently. Recent research into the health benefits of organic food caught the attention of newspapers and broadcasts nationwide. The coverage sparked some heated debates between advocates on either side of the abyss, leaving consumers standing in the produce department second-guessing their purchasing decisions.
The culprit was a paper written by a team at Stanford University discussing an analysis of existing studies that compared organic and conventional foods. The results stated that organic foods did not offer more nutritional value or fewer health risks than conventional.
The response from observers in the produce industry was simple: “Yes, we know.”
The paper misses the point entirely, says Addie Pobst, import coordinator and food safety officer for CF Fresh, based in Sedro-Woolley, Wash. “We have never promoted organics as being more nutritious; that is not what it is about. The industry states that it could be better for you because it reduces your exposure to pesticides, but there has never been an argument that there are more vitamins in organic than conventional.”
The study’s methodology itself received criticism. The findings implied that there is no health benefit to eating organic over conventional, which, according to many observers, is not accurate. “It seems to make sense on the surface, but the studies fail to consider a significant variable—the conventional product has been subjected to pesticide use throughout its growing cycle,” says Simcha Weinstein, director of marketing at Albert’s Organics, based in Bridgeport, N.J. “It is troubling that pesticides on fruits and vegetables are not viewed as part of the nutritional make-up of these foods.”
The findings came at a pivotal time period. Consumers bombarded with healthy eating initiatives are paying more attention to their health and, therefore, the produce department. The organic produce segment had shown consistent growth for the past ten years, with 12.2% growth in 2011 alone.
According to Barbara Haumann, spokesperson for the Organic Trade Association, based in Brattleboro, Vt., consumers are most motivated to choose organic over conventional to avoid exposure to pesticides. “Consumers indicate that they seek organic products because they are produced without toxic and persistent synthetic pesticides and fertilizers, as well as without the use of antibiotics and synthetic hormones.”
Observers predict the growth to continue. Focusing on the apple category in particular, Paul Newman, head of organic sales for Oneonta Starr Ranch Growers, based in Wenatchee, Wash., expects to see a shift in the demand for certain varieties as the category approaches a new pressure level. Retailers will have to continue to reevaluate their offerings—organic and not—to meet consumers’ ever changing demands.
“It is similar to what we see on the conventional side,” Newman says. “Not every package or size or grade has an easy placement in the organic category. For example, the 2 1/4-inch poly bag domestically is not always an easy sell for organic, and the 36- and 48-size Fujis and Honeycrisps was a tougher sell this year—they are big apples and consumers see the high ring at the register and it freaks them out.”
Oneonta Starr jumped into the organic sector this past year through a partnership with Columbia Valley Fruit. The movement has been on the grower’s radar for a while; Oneonta wanted to become a one-stop shop for its customers that sell both conventional and organic products. “We want to give retailers the opportunity to pick up the full package,” says Newman. “It is not different than what our grocery stores have to do. They do not want customers going across the street for one item; he or she might see something else that dazzles than and the next thing they know, they have lost a customer.”
Another category still showing growth is organic bagged salads. As a whole the bagged salad category has been down, yet the organic segment continues to grow, says John Burge, vice president of sales and marketing for Classic Salads, based in Watsonville, Calif.
Why they buy
Environmental concerns play a strong role in consumers’ organic purchasing decisions. Organic shoppers tend to prioritize environmental and social issues more than conventional shoppers, say observers.
Most organic shoppers know that buying organic means they are supporting the environment and better working and living conditions for the farmers, says Mayra Velazquez de Leon, president of Organics Unlimited. Officials for the San Diego-based company say they see a tremendous interest in its GROW label and Fair Trade label, both of which support the workers and communities where they are growing fruit. “The elimination of strong chemicals in the growing process means it is safer for workers and more sustainable for the earth,” she adds.
Promoting organic produce does not require a magic formula. Bil Goldfield, communications manager for Dole Fresh Fruit, based in Westlake Village, Calif., says many of the selling strategies that work with conventional bananas are also successful with organic bananas. This could include single-fruit displays and placing bananas at checkout.
“We rely on consumers’ passion for organic bananas. We do not actively tout the benefits of organic bananas over conventional, especially since both varieties are often side-by-side,” says Goldfield.
Todd Linsky, vice president of organic sales for Grimmway Farms, based in Bakersfield, Calif. agrees. “We do not prescribe to the theory of finger-pointing to organic versus conventional. It is really up to personal choice. At the end of the day, I firmly believe that if someone eats a conventional apple or an organic apple, the fact that they are eating an apple is really the goal for all of us.”
The who of it
Who is the organic shopper? It is a question the industry is continuously re-evaluating. Observers agree on one thing: the organic shopper is someone who cares. Organic consumers care about their personal health, as well as a range of social, environmental and sustainability issues.
“We are seeing a return to the roots of the organic and natural foods movement, where the focus is on future generations and creating a sustainable food system for generations to come,” says Weinstein, adding that this will likely be a driving force moving people to buy organic. “It is about the collective good of our society.”
Location plays a major role. Sales show there is a higher concentration of organic shoppers on both the East and West coasts. Although there are urban pockets throughout the country that do well, says Burge.
Organic produce companies are working towards boosting penetration market by market. “Retailers in the middle of the country recognize there is a demand for organic produce, and the industry has worked its way into major chains in the Midwest and the South, but there is not a lot of consumer takeaway for those stores—the velocity is not the same as it is in New York or San Francisco,” says Burge.
Being present in major stores will have an influence, he adds, especially among younger demographics. “If retailers and growers advertise to this clientele, they will catch them.”
Pobst agrees that there is a strong association among younger age groups, especially students. People tend to associate fresh fruits snacks with a healthy, younger, active shopper, she says. “Organic as a category appeals to younger consumers, as well as the family demographic, partly because of the ecological consciousness that goes along with the organic movement.”
How can organics expand? It is about making organics available, and affordable. “What we have worked hard at is simply to make sure organic products are actually organic and bringing them to more mainstream markets with more pricing purity,” Pobst says. “Once they make that first step to buy a few organic items, they tend to buy more over time and become very loyal customers.”
With fruit on top
Fresh fruit is at the top of snack list. According to research conducted by The NPD Group, a global information company, fresh fruit is the top snack food consumed in America—and the fastest growing. The report attributes fruit’s popularity to consumers’ concerns about health and eating right, as well as its versatility to be eaten at all times of the day. Fruit beat out chocolate and potato chips, the second and third place contestants.
The NPD Group found that while fruit is popular among all ages, the over-65 and children under-12 age groups eat the most fruit. Many of these consumers are choosing organic products, say industry observers, especially moms.
“Parents’ strongest motivating factor to buy organic products is the belief that ‘they are healthier for me and my children,’ and in an effort to maintain their health, families are increasing looking to fruits and vegetables,” says Barbara Haumann, spokesperson for the Organic Trade Association, based in Brattleboro, Vt. “Parents do, however, indicate that if an organic produce item is not available, many of them would still buy produce, either substituting the conventional version of the desired item or by choosing an alternative organic fruit or vegetable.”