Into the mainstream: What’s next for organic foods and beverages?

Laurie Demeritt

The organic market continues its decades-long growth trajectory via expansion into the mainstream, making organic foods and beverages across categories more accessible than ever before.

 As a continuation of The Hartman Group’s long-running syndicated research on the organic market stretching back over 25 years, our newest report, Organic 2022: Then, Now, Next, explores the transformation of organic from a niche category based in a social movement to a mainstream marker of quality across food and beverage categories. 

Organic 2022: Then, Now, Next finds that after a surge in the beginning of the pandemic, the organic market continues its decades-long growth trajectory via expansion into the mainstream, making organic foods and beverages across categories more accessible than ever before in terms of both availability and price. 

In the early days of the pandemic, when information about COVID-19 was still scarce, many consumers turned to nutrition and supplements to assert some control over their health. Beyond remedies like elderberry and vitamin C, many chose to focus on better nutrition and exercise as proven preventative measures. Amid conflicting health information and a tumultuous economic and political climate, consumers looking for a healthier option turned to organic products due to the trust they place in the USDA certification and the ability to easily identify these products in store.

Organic products also became more readily available and affordable with mainstream grocers and club stores offering a wider selection of organic foods and beverages from both national brands and private labels. While the initial organic boom in 2020 slowed over the course of the pandemic, growth in organic has continued to rise as wellness culture has taken on a more urgent tone in response to the ongoing pandemic. In addition, the scope of wellness culture has continued to expand into issues of social equity, labor rights, environmental justice, and community health, creating an evolving organic landscape.

Organic foods and beverages are going mainstream, and today exist to some degree in virtually every food and beverage category: 82% of consumers say they use organic foods and beverages at least sometimes with millennials leading in usage. Organic has become a household staple for many – even among Baby Boomers, the age group slowest to adopt organic products, nearly one-fifth (18%) of whom say they use them at least weekly. Organic usage has also grown in frequency, with almost half (47%) of Millennials using organic products at least weekly.

However, the expansion of organic has also fueled a paradox of choice wherein consumers are left to navigate an increasingly complex decision-making landscape around healthy and organic food options.

Highlights include:

  • Confronted with greater choice and a heightened degree of anxiety around health, many consumers turn to organic for healthier options, though detailed knowledge of USDA Organic certification criteria has not necessarily increased.
  • Organic has become much more accessible in recent years, both in terms of broad availability across all channels and in terms of declining price premiums (noted by long-term organic consumers), though price remains a barrier for many.
  • As organic has expanded, the category adoption pathway has remained largely consistent, with produce, dairy, and meat as the key entry points to organic along with other special categories (e.g., baby food, plant-based alternatives).

Hallmarks pointing to future growth and evolution are reflected in consumer involvement with organics as measured by the reach of organic purchasing in over 21 food and beverage categories analyzed in the report.  

For example:

  • 60% of consumers buying fresh produce say they’ve bought organic foods in that category in the past three months, followed by 55% indicating purchases of organics in plant-based meat alternatives and 49% indicating purchases of organics in plant-based dairy alternatives.
  • Categories of organic purchasing showing significant increases and momentum from 2020 include fresh meats and seafood, refrigerated dairy foods, packaged foods, pet food and treats, packaged foods and packaged frozen foods.

What’s next for organics?

Overall, we find that organic sales continue a decades-long growth trajectory as consumers increasingly look to take health into their own hands. Return to double-digit growth for organic food sales in 2020 was fueled by early pandemic stock-up behaviors and increased demand for foods that support resilience to illness. Industry forecasts anticipate a slower pace in 2021-22 but a sustained growth nevertheless. 

As to what’s next, Organic 2022: Then, Now, Next predicts that with the organic market now mature, and continuing to expand in depth and breadth, both organic producers and retailers have an opportunity to innovate with confidence, offering branded and private label products across all categories that would appeal to both mainstream and Core-trending (e.g., highly organic-engaged) consumers and solve for needs they have but feel they cannot currently address.

Opportunities also exist in foodservice: While consumer demand for organic at a retailer and brand level continues to increase, there is also a growing desire for organic at everyday food service locations as well as at higher-end dining locations.

Written by Laurie Demeritt ~

Read the original article here ~

Article source SmartBrief ~

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