February 2009
Certified Organic Associations of British Columbia Outline Todays - - PowerPoint PPT Presentation
Certified Organic Associations of British Columbia Outline Todays - - PowerPoint PPT Presentation
February 2009 Certified Organic Associations of British Columbia Outline Todays organic consumer Relevant trends to be aware of Demographics Wellness Lifestyle Knowledge Supply side trends Changes in
Outline
Today’s organic consumer Relevant trends to be aware of
– Demographics – Wellness – Lifestyle – Knowledge – Supply side trends – Changes in consumer demands
Staying relevant to consumers
– Leveraging brands – Tomorrow’s organic consumer
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Past 3 Month Purchase of Organic Food
More than half of Canadians have purchased organic foods in the past three months…
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Source: Angus Reid Strategies, Feb 2009
Only 1 in 5 Canadians are really “committed” to shopping for organic
48% 32%
19% Frequency of Shopping for Organic/Natural
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16% 3%
Always Often Sometimes Rarely/Never
Source: Angus Reid Strategies, Feb 2009
A typical organic buyer is likely to be…
Female Higher Income College/University Educated Employed Full- time
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Organic Segmentation Organic purchasers generally fall into two groups: Long standing organic buyer Newly converted
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buyer
- Concerned about health and
quality of food
- Goes out of their way to seek
- ut organic products
- Very educated about organic
products, certificates, etc.
- Concerned about health and
quality of food
- Goes out of their way to seek
- ut organic products
- Very educated about organic
products, certificates, etc.
- Trendy
- Casual organic buyers who do
not go out of their way to seek
- ut organic/natural products
- Trendy
- Casual organic buyers who do
not go out of their way to seek
- ut organic/natural products
Organic purchasers are more than just their demographics…
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Source: Natural Marketing Institute
Trends: Demographics
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Household Definitions are Changing
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Aging Society
Expenditures by Age Group
By 2030, the percent of persons 65+ will almost double, growing from 12% to 23%
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Trends: Wellness
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“For the first time in human history, the number of
- verweight people rivals the number of underweight
- people. ... While the world’s underfed population has
- people. ... While the world’s underfed population has
declined slightly since 1980 to 1.1 billion, the number
- f overweight people has surged to 1.1 billion.”
- - American Obesity Society
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Role of food is changing to help improve health More 50% of Canadians change their diet to maintain health Significant growth in the “better for you” category in retail category in retail Consumers say they are putting more importance on nutrition when purchasing food
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Trends: Lifestyle
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Busy Lifestyle = Need for Convenience For almost one-quarter of Canadians, 3 or more of their weekly meals are prepared outside the home – In 1992, 51% of Canadians were making a homemade meal from scratch every day – by 2002 homemade meal from scratch every day – by 2002 it was 27%. – 41% of those who eat poorly blame their “time crunch”
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Source: University of Alberta
Trends: Knowledge
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Consumers are empowered like they never have been before
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There are no more secrets to hide…
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Changes in Consumer Demands
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What are consumers looking for?
When shopping for your household’s groceries, how important is it that you seek
- ut each of the following?
45%
Locally produced / processed food Natural food without preservatives
- r highly processed ingredients
36%
- r highly processed ingredients
Fair trade foods, guarantees farmers are paid a fair price Organic foods
19% 25% 36%
Source: Angus Reid Strategies, Feb 2009
Consumers are paying more attention to buying local
% Paying More Attention When Shopping
Locally produced / processed food Natural food without
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preservatives Fair trade foods, guarantees farmers are paid a fair price Organic foods
Source: Angus Reid Strategies, Feb 2009
Locavores
Local foods: – There is a local food movement (locavores) taking off. – Consumers believe eating local is healthier, better for the environment, and better for the economy. – It’s a way to address food and nutrition concerns along with concerns about the environment. We see this manifesting itself in:
- Growth in farmers’ markets
- Restaurants with local menus
- Decreasing carbon footprint of food
– The definition of what ‘local’ is can be a challenge. Is it within 100 km? Within BC? Within Canada? Consumers want to get in touch with their food…a reversal to the past where locally grown, seasonal food was eaten. A movement away from fast, processed, packaged food.
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Changes in Consumer Expectations
There are certain expectations when it comes to organic foods companies that consumers have. – Environmentally/socially responsible (recyclable packaging, reduced carbon imprint, giving back to communities and charities, fair trade) – Corporate values that align with what they are promoting – Treating employees with respect There are different levels of how authentic an organic brand is perceived to be. A genuinely organic brand is: – A small company, – local, – established as a organic/natural foods producer from day one (rather than capitalizing on recent trends), – a company that ‘walks the walk.’
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Supply-Side & Distribution Trends
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Progression of Foods
Mass Produced Stimulate Taste Buds “Without” Food Foods That Add Health Back to Basics Quantity High fat Low fat Probiotics Organic
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Quantity & Pre- packaged High fat High salt High sugar Low fat Sugar free No artificial flavour Probiotics Added Calcuim With ginseng Organic Local Authentic
Organic and natural food market is no longer niche. – Major manufacturers are producing organic foods (‘Big’ Organics) or are acquiring organic companies.
- Ben & Jerry’s Organic Ice Cream, Heinz Organic Baby Food, Kraft
Organic Ritz and Wheat Thin Crackers, Organic Raisin Bran, Rice Krispies, Mini-Wheats, etc. This results in consumers…
Changes in the Market
– Questioning the validity of organic/natural claims – Rejecting certain brands based on dislike for parent company
Distribution and Marketing Focus
As the organic/natural/local/fair-trade food movement shifts more mainstream, the focus should be on making the products accessible and affordable for the average grocery buyer.
– The hard-core natural/organic buyers are willing to go out of their way to seek out
- rganic and natural products, but newly converted or occasional natural/organic
buyers do not.
Increasing visibility at traditional grocery stores is the key to targeting new Increasing visibility at traditional grocery stores is the key to targeting new and casual organic buyers.
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Shopping Habits of Always/often Organic Buyers
Where do you do the bulk of your household’s grocery shopping? (Often/always organic food buyers)
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Source: Angus Reid Strategies, Feb 2009
Relevance
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Battle for Relevance Over 33,000 New Products introduced in the USA last year:
– 95% didn’t break the $1 million mark – Only 22 generated over $50 million in annual retail sales – Majority of which were line extensions, new flavors/scents, or “Me Too” – Few were meaningful to the Consumer
Major brands are changing the way they talk to consumers
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Brands are moving emotional
- What emotions does the product evoke?
How does it make the consumer feel?
Optimism, aggressiveness Like a champion
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- What does the product do?
How it is different?
On-court basketball shoe High-tech design delivers comfort and endurance Optimism, aggressiveness
We strongly encourage the inclusion of each of these types of product attributes and benefits in brand ratings. In our experience, emotional reactions and connections are often underrepresented relative to their power in driving share
Brands are more than functional delivery mechanisms
“Our mental life is governed mainly by a cauldron of emotions, motives and desires which we are barely conscious of, and what we call our conscious life is usually an elaborate post-hoc rationalization of things we really do for other reasons”
Neuroscientist V.S. Ramachandran
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Brand
Feelings Personality Functional
So, how important is certification?
Important: 84%
How important is it that the
- rganic food your purchase
be certified as truly organic by a third party?
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Source: Angus Reid Strategies, Feb 2009
But certification is a lower-order benefit, it’s not enough to guarantee success
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- Organic or natural
Certified Organic
General Organic Purchaser Attitudes
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Source: Natural Marketing Institute
Emphasize Higher Order Connections
- Organic makes me feel optimistic
I feel better about myself because I purchase organic
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- Organic tastes better
Organic is good for me
Tomorrow’s Organic Consumer will be Mainstream, so macro trends will be relevant…
Smaller households = decreased need for value packs Aging society = packaging implications, font size, hand strength On the go lifestyle = greater need for prepared meals On the go lifestyle = greater need for prepared meals Focus on health generally = organic “I am what I eat” Focus on weight control = 100 calorie packs, sugar free Knowledge = Authentic “because I can find out if you’re a fraud”
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Strategy: Being an Authentic Organic Brand
To differentiate from ‘big organics’ and to be endorsed by long-standing
- rganic buyers, the key is to believe in the organic philosophy 100% and
live and breathe it in every part of the company. The payoff? – Be embraced by these educated and aware long-standing organic consumers who in turn become brand champions. – Develop a loyal user base through high quality products – differentiated from pseudo-organic products.
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Thank You Questions?
Mike Rodenburgh Angus Reid Strategies mike@angus-reid.com
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