Veena Annadana
Well-Known Member
USA - Organic food bubble about to burst 26 Dec 2009
Meat and poultry companies still hoping to cash in on the growing market for organic products may want to think again. New research from the Connecticut-based TABS Group suggests the market is, if not static, then not growing in terms of numbers of shoppers.
"In the mass market, organic is not growing," TABS founder and president Dr. Kurt Jetta told MEATPOULTRY.com. "Every year we measure the popularity of several categories of so-called, good-for-you products, and organic consistently has the lowest appeal."
Any growth that the organic category has seen, he said, comes from higher purchases from shoppers who already identify themselves as organic-preferrers. Crucially, the number of shoppers for organic products is not growing. According to TABS’s data, just 38 percent of adults say they have purchased any product from any of the major organic categories – fruits and vegetables, eggs and milk, frozen items – in the past six months. Organic fresh fruit had the highest purchase incidence at 26 percent, followed by organic vegetables at 17 percent.
Mainstream supermarkets continue to be the preferred source for organic products, outpacing natural food stores by 39 percent to 27 percent. Yet according to TABS, while there were 50 percent more organic shoppers at mainstream stores than specialty stores, there are 20-30 times more mainstream stores.
"When we see a dynamic that says it takes a 20-fold increase in store count to generate a 50-percent increase in buyer count, we conclude that the vast majority of retailers with a broad assortment of these products are seeing a very low return on investment," Jetta commented in a statement. "We can only hope that the mainstream retailers and manufacturers stop marching in lockstep to this illusory 'trend' and refocus their efforts on more mainstream categories and products. There is a role for a modest selection of organic products in their store, but they should accept that the natural food markets are better positioned to service the needs of the organic shopper."
His advice to retailers who have made a big commitment to organic foods: "You better have a Plan B to get that stuff off of the shelves."
But what about the major boost organic products have received in the media and elsewhere, with experts and food companies alike touting various benefits from the consumption of organic foods? "The press hype about certain emerging trends almost never gets it right," Jetta told MEATPOULTRY.com. "You can look over the trends that have been forecast over the past several years – there’d be a big boom in food products for teenagers, for example, and then it was the ‘metrosexual’ shopper, and after that there was going to be big growth in products with new and exotic kinds of spices – and they didn’t happen."
The vast majority of shoppers, Jetta contends, "are conservative. The trends everyone talks about may be trends in large urban centers like New York, Boston and San Francisco, but that doesn’t mean they’re trends in the heartland. The other thing is that these predicted trends are almost always for upscale products and upscale shoppers, but most people aren’t upscale." He said that for most shoppers, the price-value relationship continues to drive most shopping decisions, not considerations about whether a product was grown or processed locally or according to organic or sustainable standards.
The Organic Product study was conducted among 1,000 representative respondents aged 18-75. The study was fielded from Dec 3-6, 2009, and it replicated a study that was completed in November 2008. Jetta told MEATPOULTRY.com that organic meat and poultry was not specifically measured as a separate category, but "I would venture to say that the results for the category wouldn’t be significantly different from what we found" for other categories.
Source: meatpoultry.com
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Meat and poultry companies still hoping to cash in on the growing market for organic products may want to think again. New research from the Connecticut-based TABS Group suggests the market is, if not static, then not growing in terms of numbers of shoppers.
"In the mass market, organic is not growing," TABS founder and president Dr. Kurt Jetta told MEATPOULTRY.com. "Every year we measure the popularity of several categories of so-called, good-for-you products, and organic consistently has the lowest appeal."
Any growth that the organic category has seen, he said, comes from higher purchases from shoppers who already identify themselves as organic-preferrers. Crucially, the number of shoppers for organic products is not growing. According to TABS’s data, just 38 percent of adults say they have purchased any product from any of the major organic categories – fruits and vegetables, eggs and milk, frozen items – in the past six months. Organic fresh fruit had the highest purchase incidence at 26 percent, followed by organic vegetables at 17 percent.
Mainstream supermarkets continue to be the preferred source for organic products, outpacing natural food stores by 39 percent to 27 percent. Yet according to TABS, while there were 50 percent more organic shoppers at mainstream stores than specialty stores, there are 20-30 times more mainstream stores.
"When we see a dynamic that says it takes a 20-fold increase in store count to generate a 50-percent increase in buyer count, we conclude that the vast majority of retailers with a broad assortment of these products are seeing a very low return on investment," Jetta commented in a statement. "We can only hope that the mainstream retailers and manufacturers stop marching in lockstep to this illusory 'trend' and refocus their efforts on more mainstream categories and products. There is a role for a modest selection of organic products in their store, but they should accept that the natural food markets are better positioned to service the needs of the organic shopper."
His advice to retailers who have made a big commitment to organic foods: "You better have a Plan B to get that stuff off of the shelves."
But what about the major boost organic products have received in the media and elsewhere, with experts and food companies alike touting various benefits from the consumption of organic foods? "The press hype about certain emerging trends almost never gets it right," Jetta told MEATPOULTRY.com. "You can look over the trends that have been forecast over the past several years – there’d be a big boom in food products for teenagers, for example, and then it was the ‘metrosexual’ shopper, and after that there was going to be big growth in products with new and exotic kinds of spices – and they didn’t happen."
The vast majority of shoppers, Jetta contends, "are conservative. The trends everyone talks about may be trends in large urban centers like New York, Boston and San Francisco, but that doesn’t mean they’re trends in the heartland. The other thing is that these predicted trends are almost always for upscale products and upscale shoppers, but most people aren’t upscale." He said that for most shoppers, the price-value relationship continues to drive most shopping decisions, not considerations about whether a product was grown or processed locally or according to organic or sustainable standards.
The Organic Product study was conducted among 1,000 representative respondents aged 18-75. The study was fielded from Dec 3-6, 2009, and it replicated a study that was completed in November 2008. Jetta told MEATPOULTRY.com that organic meat and poultry was not specifically measured as a separate category, but "I would venture to say that the results for the category wouldn’t be significantly different from what we found" for other categories.
Source: meatpoultry.com
Back to News Headlines