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Despite a lot of media attention and increased grocer interest in stocking organic food and HBC items, there has actually been no growth in the number of U.S. consumers who buy such products, according to a recent study by TABS Group, a Shelton, Conn.-based marketing, research and consulting firm in the consumer products industry.
“The usage results for our latest study were remarkably similar to the results from last year’s study: organic food and beauty products continue to be niche products; they have not penetrated a mass audience, to date,” said TABS Group president and founder Dr. Kurt Jetta. “Identical to last year, only 38 percent of adults claim to have purchased anything from the major organic categories in the last six months.”
The study found that organic fresh fruit had the highest purchase incidence, at 26 percent, with organic fresh vegetables close behind, at 25 percent. Seventeen percent and 16 percent of respondents, respectively, said they bought organic dairy products, eggs and milk. Frozen organic products, which include vegetables, fruit and ice cream, had low purchase levels, at 5 percent to 7 percent. Purchase levels for organic HBC products also had low mainstream acceptance, with organic skin care at 6 percent and organic hair care and cosmetics at 4 percent. There was no significant change in the household penetration of any of these categories vs. the study carried by TABS Group in 2008. By contrast, non-organic products for all of the categories studied have household penetration levels of well above 70 percent.
According to TABS Group’s research, respondents preferred to buy organic products in mainstream supermarkets rather than in natural food stores, by a margin of 39 percent to 27 percent. Jetta noted, however, that while there were 50 percent more organic shoppers at traditional grocery stores than at natural food outlets, there are 20 to 30 times more of the mainstream locations.
“When we see a dynamic that says that it takes a 20-fold increase in store count to generate a 50 percent increase in buyer count, we conclude that the vast majority [of] retailers with a broad assortment of these products are seeing very low returns on their investment,” observed Jetta. “We can only hope that the mainstream retailers and manufacturers stop marching in lockstep to this illusory ‘trend’ and refocus their efforts on more mainstream categories and products. There is a role for a modest selection of organic products in their store, but they should accept that the natural food markets are better positioned to service the needs of the organic shopper.’
The study, which polled 1,000 representative respondents age 18 to 75 in the TNS panel, was fielded from Dec. 3 through Dec. 6, 2009, replicating a study that was carried out in November 2008.