Natural Foods Merchandiser

Consumer splintering in the organic world

We often read polls about "organic consumers," as if they are some monolithic body. One of the more recent polls found that 35 percent of consumers in the Bay Area bought organic food.

Wow! Great news. But I'd argue that the pollsters often miss the trees for the forest. This consumer forest is made up of many kinds of trees, creating a market that is diffuse, splintered and hard to capture in a quick snapshot.

How so? Consider that 35 percent figure. No doubt, the Bay Area is big on organic food, but the survey had a pretty low threshold to get a positive hit. The consumers had to have used an organic product once in the past month.

Considering all the stuff people eat, does the consumption of one organic product — a sports bar, a glass of milk, a salad — in one month make them an organic consumer? I don't think so, but this also reveals something about the organic marketplace.

A few years ago, I attended the annual meeting of Whole Foods Markets, where I learned that hard-core organic consumers made up about 10 percent of the company's business. That surprised me. Ten percent sounded low. They described other core shoppers as families, fitness addicts, and foodies. Each bought a core group of products, but they also overlapped.

Whole Foods built a healthy business by aggregating these customers in ways that didn't conflict. Had they only focused on the core organic consumer they would be much smaller than they are today.

So here's the point, all the polls and the numbers focus on how many people are buying organic food, how organic food is growing, but few look in-depth at the way people shop. And when you look at the way people shop — actually go into their kitchen pantries and watch them eat — you see that the organic consumer is not a single entity but a highly varied species. Organic food is found in a vast number of venues, each of which appeal to different consumers. As one friend said this isn't the "mainstreaming" of organic food, but the "multi-streaming" of organics.

Simultaneously, there has been a proliferation of food labels, such as organic, fair trade, local, humanely raised, and sustainable — the latter most often applied to certified seafood — each of which might appeal to a particular customer with a slightly different set of values. Very few would seek out all of the labels on every product they buy.

I like to think of these consumers on a spectrum defined by various attributes. This spectrum is also dynamic, since consumers never stand still. They are always changing. Which brings me to a final point. People often bemoan the price of local and organic food. But what they don't discuss is value.

For many consumers — or at least those growing this market to its current $16 billion in size — organic food is worth the money because they get something they cannot get elsewhere. The same might be said for humanely raised meats, sustainable seafood, local produce and anything else that has distinct attributes. These consumers are not paying more for this food — they're buying an entirely different product that aligns with their values.

Value is really the bigger issue here. Not price. Not monolithic market. Look closely at those values and you will find the consumers — all of them, from every stripe, each of which need something slightly different to be fulfilled.

Which is why this business is so tough, but also interesting.

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