"We're All Doomed…?"

With unrelenting financial gloom surrounding us at present it is a challenge to stay positive. A briefing from the newly-formed Organic Trade Board in October gave some helpful food for thought. First up was James Twine, Commercial Director of the Soil Association. James has been talking to Soil Association member companies and also to retailers to find out what they thought would happen to the organic market in the coming 12 months. The slightly surprising response was that everyone foresaw growth, the average figure being +12%. James did admit that there are some mixed messages with  Asda’s organic sales up 25% whilst at Tesco sales of organic have ‘ground to a halt’ (according to boss Terry Leahy).

The second presentation was from Mintel analyst Vivienne Ihekweazu talking about “What will make or break the UK organic market over the next 5 years?” (www.oxygen.mintel.com). Vivienne summarised key consumer trends when buying food: health benefits (especially low fat/low sugar), local sourcing, food with a story to tell (eg Fairtrade) and increased concern over food miles. She then went on talk about some work she has recently done on  Local versus Organic. Consumers in rural areas favour local over organic, whereas consumers in urban areas favour organic over local (probably because they do not feel so connected to local farmers). Local is perceived as fresh and eco-sound – although it may of course be drenched in pesticides!  Whilst the poorer uptake of locally sourced food by younger consumers could be a challenge to future growth the growing popularity of locally-sourced foods may cause farmers to question their commitment to organics.

Vivienne then looked at why consumers were not buying organic food. Unsurprisingly the key barrier to purchase is price: ‘expensive for what it is’ . There is also scepticism over the added benefits and value of organic foods.  Some research on Attitudes of Organic Shoppers to Economic Challenges proved fascinating: 46% of organic shoppers said “I will buy as much organic food as I used to ” , 6% said “I will buy more”  and only  9% said they would stop buying organic products in the event of an economic downturn whilst 39% said their organic buying habits would remain unchanged. Vivienne listed the challenges to growing the organic market as getting consumers to overcome the perceived oncost of organics (in real terms organics is becoming more affordable) and explaining the differences and benefits of organic products. The Organic Trade Board certainly has on its agenda simplifying the organic message to consumers, whilst  affordability and value for money will be key for all of us in the coming months. Perhaps doing a  Private Fraser would be an over-reaction at this point…