Table of Contents
Executive Summary
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- Market factors: Rising interest in healthy eating
- Market factors: Obesity
- Market factors: Sustainability
- Perceptions of “natural” and “organic” meaning
- Interest in natural/organic options
- Category usage in NOFB
- Impact of the recession on NOFB usage
- Shifts in brand/private label usage
- Influence of parallel movements; local, Fair Trade, vegetarianism
Insights and Opportunities
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- Schools could become NOFB industry’s most important customers
- Pitching the flavor factor
- Overcoming resistance to premiums may be as easy as telling the truth
Inspire Insights
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- The Rise of Behavioral Economics
- What's it about?
- What we've seen
- Specifics
- Implications
Market Factors: Rising Interest in Healthy Eating
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- Key points
- Usage driven largely by association with health and wellness
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- Figure 1: Interest in natural/organic products, by diet healthfulness compared to last year, December 2009
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- Figure 2: Interest in natural/organic products, by diet healthfulness, December 2009
- Aging population drives many to think more about their health
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- Figure 3: U.S. population, by age, 2004-14
- Need to increase fruit and vegetable intake adds to appeal of natural
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- Figure 4: Average daily per capita calories consumed*, by food group, 1970-2004
- Cooking at home trend goes hand in hand with simple living and nutrition
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- Figure 5: Strategies for dealing with recessionary pressures, by household income, October 2009
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- Figure 6: Time spent cooking vs. going out or getting takeout, October 2009
- Appeal to cooks with American, Italian and Mexican cuisines
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- Figure 7: Top 10 cuisines among casual and serious enthusiasts, June 2008
- Incidence of overall product claims slow but increasingly common on natural/organic
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- Figure 8: Top "Low/No" claims across all food categories (with overall rank # in total top 20 claims), 2005-09
- Figure 9: Top "Low/No" claims across food products that are natural/organic (with overall rank # in total top 20 claims), 2005-09
Market Factors: Obesity
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- Key points
- Record high obesity rates cause some to embrace natural/organic
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- Figure 10: Trended Nationwide (States, DC, and Territories) incidence of overweight and obesity, 1995-2007
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- Figure 11: Perception of weight relative to height, by age, January 2009
- First Lady and new legislative efforts likely to drive growth of BFY options including NOFB
Market Factors: Sustainability
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- Key points
- Educated affluents use more natural/organic and are more likely to express concerns about the environment
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- Figure 12: Environmental attitudes among Mosaic clusters mostly likely to use natural/organic products, November 2008-June 2009
- Environmental concerns have been growing among users
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- Figure 13: Concern about the environment compared with one year ago, by age, September 2009
- Use of green products slowed as a result of recession but demand remains relatively strong
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- Figure 14: Change in frequency of purchasing different categories of green products, 2007-09
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- Figure 15: Sales of natural products through conventional FDMx and natural supermarkets segmented by product type, 2006 and 2008
- Sustainability in action: the cases of Stonyfield Farm and Whole Foods
- Stonyfield Farm
- Whole Foods Market
Brand Qualities
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- Kashi: Ethnic healthy-gourmet dishes that can be prepared in minutes
- Amy’s Kitchen
Advertising and Promotion
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- Overview
- Sun Chips leverages eco-friendly packaging to gain an edge
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- Figure 16: Sun Chips compostable chip bag, television ad, 2010
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- Figure 17: Sun Chips; See it, feel it, worship it, taste it, television ad, 2008
- Websites critical tool for many natural/organic marketers
- Kashi.com
- Wholefoods.com
Perceptions of “Natural” and “Organic” Meaning
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- Key points
- Many confused about meaning of terms and standards
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- Figure 18: Trust and understanding of the terms “natural” and “organic”, September 2009
Interest in Natural/Organic Options
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- Key points
- Young adults significantly more likely to have interest in natural/organic
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- Figure 19: Interest in natural/organic products, by age, December 2009
- Interest somewhat higher within upper income segments
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- Figure 20: Interest in natural/organic products, by household income, December 2009
- About six in 10 users willing to pay a price premium
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- Figure 21: Willingness to pay for natural/organic products, and attitudes towards healthfulness and belief in natural/organic claims, by age, September 2009
Natural/Organic Usage, by Lifestyle Segment
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- Key point
- Educated affluents more likely to embrace the category
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- Figure 22: Food shopping/diet, by high demand Mosaic clusters, November 2008 – June 2009
- Figure 23: Use of fresh produce (organic, non-organic), by high demand Mosaic clusters, November 2008 – June 2009
Category Usage
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- Key points
- Produce still the hot category
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- Figure 24: Use of natural/organic proteins and produce, by age, December 2009
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- Figure 25: Use of natural/organic packaged food/beverage, by age, December 2009
- Income has little influence on use of natural, but is a key factor in organics
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- Figure 26: Use of natural/organic proteins and produce, by household income, December 2009
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- Figure 27: Use of natural/organic packaged food/beverage, by household income, December 2009
The Recession’s Impact on Consumer Behavior Regarding NOFB
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- Key points
- Most users consume about the same amount of natural, despite recession
- Natural products
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- Figure 28: Impact of recession on use of natural food and drink, by age, December 2009
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- Figure 29: Impact of recession on use of natural food, by household income, December 2009
- Organic products
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- Figure 30: Impact of recession on use of organics, by age, December 2009
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- Figure 31: Impact of recession on use of organics, by household income, December 2009
- Young adults and low-income users more likely to trade down from organic to natural
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- Figure 32: Changed natural/organic purchasing habits in response to recession, by age, December 2009
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- Figure 33: Changed natural/organic purchasing habits in response to recession, by household income, December 2009
Types of Brands Used
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- Key points
- Most buy a mix of private label and name brands
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- Figure 34: Natural/organic brands purchased, by age, December 2009
- Most users of national brands remain loyal
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- Figure 35: Changed natural/organic purchasing habits with name brands in response to recession, by household income, December 2009
- Young adults and those with modest incomes search for the cheapest of natural/organic private labels
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- Figure 36: Changed natural/organic purchasing habits with private label in response to recession, by age, December 2009
Influence of Local and Fair Trade Claims
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- Key points
- Demand for local much higher than Fair Trade
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- Figure 37: Interest in natural/organic products with certain claims, by age, December 2009
- Figure 38: Interest in natural/organic products with certain claims, by household income, December 2009
Interest in Vegetarian and Vegan Options
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- Key points
- Young adults and affluents more likely to have interest in “going veg”
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- Figure 39: Interest in natural/organic products with certain claims, by age, December 2009
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- Figure 40: Interest in natural/organic products with certain claims, by household income, December 2009
Impact of Race and Hispanic Origin
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- Key points
- Asians and whites more likely to self-identify as healthy
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- Figure 41: Healthfulness of diet, by race/Hispanic origin, December 2009
- Asians and Hispanics more likely to be very interested in natural/organic
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- Figure 42: Interest in natural/organic products, by race/Hispanic origin, December 2009
- Blacks more likely to use mostly natural/organic private label
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- Figure 43: Natural/organic brands purchased, by race/Hispanic origin, December 2009
- Minorities somewhat more likely to trade down from organic to natural
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- Figure 44: Changed natural/organic purchasing habits in response to recession, by race/Hispanic origin, December 2009
- Asians much more likely to have interest in vegetarian and vegan foods
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- Figure 45: Interest in natural/organic products with certain claims, by race/Hispanic origin, December 2009
Cluster Analysis
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- Under-using unchanged
- Who they are
- Opportunity
- All-naturals
- Who they are
- Opportunity
- Organics
- Who they are
- Opportunity
- Characteristic tables
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- Figure 46: All-natural/organic purchaser clusters, December 2009
- Figure 47: Healthfulness rating, by all-natural/organic purchaser clusters, December 2009
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- Figure 48: Healthfulness of diet, by all-natural/organic purchaser clusters, December 2009
- Figure 49: Interest in natural/organic products, by all-natural/organic purchaser clusters, December 2009
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- Figure 50: Natural/organic purchases, by all-natural/organic purchaser clusters, December 2009
- Figure 51: Impact of the recession on natural/organic purchases, by all-natural/organic purchaser clusters, December 2009
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- Figure 52: Interest in natural/organic products with certain claims, by all-natural/organic purchaser clusters, December 2009
- Demographic tables:
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- Figure 53: All-natural/organic purchaser clusters, by gender, December 2009
- Figure 54: All-natural/organic purchaser clusters, by age, December 2009
- Figure 55: All-natural/organic purchaser clusters, by household income, December 2009
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- Figure 56: All-natural/organic purchaser clusters, by race/Hispanic origin, December 2009
- Cluster methodology:
Custom Consumer Groups
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- Natural/organic users more likely to be interested in Fair Trade
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- Figure 57: Use of natural/organic food and drink, by interest in Fair Trade, December 2009
- Parents more likely to show high interest
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- Figure 58: Interest in natural/organic, by male and female parental status, December 2009
- Young adults of all races and genders are a critical segment that holds growth opportunity
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- Figure 59: Interest in natural/organic, by young adult sub-group, December 2009
- More than one in three users healthier than last year
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- Figure 60: Changed in organic and natural purchase in response to recession, by healthy diet group, December 2009
Appendix: Other Useful Consumer Tables
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- By age
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- Figure 61: Healthfulness of diet, by age, December 2009
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- Figure 62: Diet compared to last year, by age, December 2009
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- Figure 63: Changed natural/organic purchasing habits in response to recession, by age, December 2009
- By household income
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- Figure 64: Healthfulness of diet, by household income, December 2009
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- Figure 65: Diet compared to last year, by household income, December 2009
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- Figure 66: Changed natural/organic purchasing habits in response to recession, by household income, December 2009
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- Figure 67: Natural/organic brands purchased, by household income, December 2009
- By race/Hispanic origin
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- Figure 68: Diet compared to last year, by race/Hispanic origin, December 2009
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- Figure 69: Use of natural/organic proteins and produce, by race/Hispanic origin December 2009
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- Figure 70: Use of natural/organic sectors, by race/Hispanic origin, December 2009
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- Figure 71: Impact of recession on use of natural food, by race/Hispanic origin, December 2009
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- Figure 72: Impact of recession on use of organics, by race/Hispanic origin, December 2009
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- Figure 73: Changed natural/organic purchasing habits in response to recession, by race/Hispanic origin, December 2009
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- Figure 74: Changed natural/organic purchasing habits in response to recession, by race/Hispanic origin, December 2009
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- Figure 75: Interest in natural/organic products with certain claims, by race/Hispanic origin, December 2009
Appendix: Trade Associations
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