Business and Operations
Organic: the Healthy Halo
May 20, 2008 By Barbara Lauer with market research provided by Harvey Hartman chairman and CEO The Hartman Group
In the ’ 60s, when flower children and hippies began to follow an “organic” lifestyle of “natural” foods, grown without conventional chemicals and the risks to the environment associated with them – somewhat obscure at the time, and limited to a homogeneous group of like-minded consumers. Since then, the term “organic” has come to represent everything from quality to health to ideology and everything in between. Put simply, based on research by The Hartman Group, organic now means many, many things to many different people. And it’s a booming business, with U.S. sales increasing from $4 billion to $18 billion since 1996.
Currently, consumers rely on the notion of organic as shorthand for a variety of attributes, including “better tasting,” “healthier,” “more real,” “less processed,” “fresh,” or “local.” Others, according to Hartman’s research, rely on organic products as a means of addressing a multitude of food allergies and fears – be they rational or not. They equate organic with “sustainable.” And, somewhere, among all these consumers, exists a small body who remain true to the originators.
While low-carb was sold on the benefits of the here-and-now, organic is virtually 100 per cent about consumers who seek long-term, intangible, invisible results (prevention of cancer or other diseases, 20 years from now, or the lessening of health risks – known or unknown – to their children, etc.). Organic purchasers can’t point to specific results they have achieved since changing their food choices, but they have a faith-based belief it its benefits. Since they don’t expect to see immediate results from organic – unlike low-carb – they cannot be disappointed with the “performance” of organic.
The mainstream organic market is relatively new, and many consumers haven’t “moved up” from product to additional products, like cereal, for instance, but this doesn’t mean they won’t be adopting more categories over the next months. It just takes a while for this evolution to happen.
The organic evolution has an added benefit for companies – the healthy halo it provides. Organic product sales may lag behind conventional versions, but consumers will give positive attributions to the company for providing the organic options – even if they don’t choose them.
The Hartman Group’s research specifically identified that consumers are looking for more organic products and brands produced and marketed especially for children. For a harried mom trying to find a “healthier” option for her child’s pizza dinner, an organic one may be exactly the thing to make her feel like a good mom and still have her child eat the meal. Even if it’s not the healthiest, it is still healthier. Wal-Mart and Safeway are already well ahead of the curve in championing the organic proposition, which is an effective strategy when reframing the retail space with an eye towards today’s wellness consumer. The mere presence of organic options, according to Hartman, contributes to the overall health and wellness halo of the retail experience. Wal-Mart is making organic more price competitive, thus reducing or eliminating one of the primary barriers for consumers’ trial and adoption of these products.
The organic market is not static; it is fluid, ever-changing and constantly evolving. It is the consumer, ultimately, who defines and shapes the market.
No matter who gazes into the future, they will tell you that organic will never really go away. It may slow down, and something else may surface, but organic will continue to have importance at some level among consumers.
With the change in the meaning of “organic” for mainstream consumers, what we are experiencing today in our industry is actually the evolution of food quality. Organic on many levels is part of a much larger construct: a major shift in our food culture toward quality. And, if we continue to experience food safety scares and scandals, as well as the arrival of cloned animal products into the marketplace, consumer concerns about food wholesomeness will continue to drive this segment, whether it is called “organic” or something else.
Organic is not going to die; it will simply become (if it truly hasn’t already) an integral part of the food culture landscape.
My organic isn’t your organic …
China’s organic exports, growing exponentially at 50 per cent a year, reap that nation some $200 million US annually. While most of the Chinese organic products are exported to Europe, an increasing portion is reaching North American dinner tables. Should consumers be concerned? According to a USDA economist, China is probably too polluted “to grow truly organic food.”
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