Table of Contents
Executive Summary
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- NOFB market shows strong growth despite sluggish economy
- Increased interest in healthy eating positive driver for NOFB market
- Local food movement and food safety concerns boost NOFB market
- Consumers traded down from organic to natural in 2009-11
- Yogurt and beverages among fastest-growing NOFB segments
- Natural specialist companies hold their own against diversified CPGs
- Performance across 10 key NOFB segments
- Yogurt and kefir
- Milk
- Chips, pretzels, and snacks
- Bread and baked goods
- Refrigerated juices and functional beverages
- Energy bars and gels
- Refrigerated non-dairy beverages
- Cold cereals
- Frozen lunch and dinner entrées
- Cookies and snack bars
- Whole Foods Market and Trader Joe’s positioned for continued growth
- “GMO-free” is fastest-growing NOFB new product claim
- Eco-friendly daily deal sites offer new marketing possibilities for NOFB brands
Insights and Opportunities
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- Focus on value creates opportunities in natural and private label sectors
- Less mature categories likely to benefit from growth of natural markets
- Traditional retailers can benefit from ties with farmers markets
- Luring new categories of shoppers to NOFB
Inspire Insights
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- Trend: Secret, Secret
- Trend: Minimize Me
Market Size and Forecast
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- Key points
- NOFB sales show faster growth than conventional food despite difficult economic conditions
- Sales and forecast of NOFB
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- Figure 2: Retail sales of NOFB, at current prices, 2009-13
- Figure 3: Retail sales of NOFB, at inflation-adjusted prices, 2009-13
- Sales and forecast of natural food and beverages
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- Figure 4: Retail sales of natural food and beverages*, at current prices, 2009-13
- Figure 5: Retail sales of natural food and beverages*, at inflation-adjusted prices, 2009-13
- Sales and forecast of organic (70%+) food and beverages
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- Figure 6: Retail sales of organic (70%+) food and beverages, at current prices, 2009-13
- Figure 7: Retail sales of organic (70%+) food and beverages, at inflation-adjusted prices, 2009-13
- Fan-chart forecast
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- Figure 8: Fan chart forecast of NOFB, 2009-13
Market Drivers
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- Key points
- Aging Baby Boomers should drive demand for natural and organic food
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- Figure 9: Population, by age, 2009-13
- Economic woes continue to pressure NOFB shoppers
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- Figure 10: Real disposable income, 2007-11*
- Figure 11: Consumer sentiment index, January 2007–July 2011
- Rising food prices strain consumer budgets
- Food inflation and income stagnation limit growth prospects for NOFB
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- Figure 12: Changes in food price indexes, 2009-12
Competitive Context
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- Key points
- Increased interest in healthier food helps drive demand for NOFB
- Concerns about food safety lead some to choose natural foods
- Snacks now make a fourth meal
- Farmers market movement continues to grow
- “Light green” consumers more likely to abandon NOFB when budgets are tight
Segment Performance
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- Key points
- Consumers trading down from organic to natural
- Sales of NOFB, by department
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- Figure 13: Sales of NOFB, by department, 2009-11
- 2011 sees big gains for yogurt, beverages
- Sales of NOFB, by segment
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- Figure 14: Sales of NOFB, by top 30 segments, 2009-11
- Figure 15: Sales of NOFB, by next 30 segments, 2009-11
- Top 15 organic and natural segments
- Organic food and beverages (70%+)
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- Figure 16: Top 15 organic food and beverage segments, 2009-11
- Natural food and beverages
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- Figure 17: Top 15 natural food and beverage segments, 2009-11
Leading Companies
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- Key points
- More large diversified players taking leading positions in the NOFB market
- Major corporations grow NOFB lines and green efforts
- Top 10 natural and organic food and beverage companies
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- Figure 18: Top 10 natural and organic food and beverage companies, 2010-11
Segment Performance and Brand Share—Yogurt and Kefir
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- Key points
- Rise of Greek-style yogurt drives growth in natural category
- Sales of yogurt and kefir
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- Figure 19: Sales of yogurt and kefir, 2009-11
- Manufacturer and brand sales of yogurt and kefir
- Natural and organic combined
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- Figure 20: Selected brand sales of natural and organic yogurt and kefir, 2010-11
- Organic (70%+)
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- Figure 21: Selected brand sales of organic yogurt and kefir, 2010-11
Segment Performance and Brand Share—Milk
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- Key points
- Consumers remain loyal to organic milk despite high prices
- Sales of milk
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- Figure 22: Sales of milk, at current prices, 2009-11
- Manufacturer and brand sales of milk
- Natural and organic combined
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- Figure 23: Selected brand sales of natural and organic milk, 2010-11
Segment Performance and Brand Share—Chips, Pretzels, and Snacks
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- Key points
- Push for healthier snacks boosts segment
- Sales of chips, pretzels, and snacks
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- Figure 24: Sales of chips, pretzels, and snacks, at current prices, 2009-11
- Manufacturer and brand sales of chips, pretzels, and snacks
- Natural and organic combined
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- Figure 25: Selected brand sales of natural and organic chips, pretzels, and snacks, 2010-11
- Organic (70%+)
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- Figure 26: Selected brand sales of organic chips, pretzels, and snacks, 2010-11
Segment Performance—Bread and Baked Goods
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- Key points
- Natural and private label organics lead growth in segment
- Sales of bread and baked goods
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- Figure 27: Sales of bread and baked goods, at current prices, 2009-11
- Manufacturer and brand sales of bread and baked goods
- Natural and organic combined
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- Figure 28: Selected brand sales of natural and organic bread and baked goods, 2010-11
- Organic (70%+)
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- Figure 29: Selected brand sales of organic bread and baked goods, 2010-11
Segment Performance and Brand Share—Refrigerated Juices and Functional Beverages
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- Key points
- Consumers trade down to private label organic refrigerated juices
- Sales of refrigerated juices and functional beverages
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- Figure 30: Sales of refrigerated juices and functional beverages, at current prices, 2009-11
- Manufacturer and brand sales of refrigerated juices and functional beverages
- Natural and organic combined
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- Figure 31: Selected brand sales of natural and organic refrigerated juices and functional beverages, 2010-11
- Organic (70%+)
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- Figure 32: Selected brand sales of organic refrigerated juices and functional beverages, 2010-11
Segment Performance and Brand Share—Energy Bars and Gels
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- Key points
- Clif Bar Inc.’s organic lines lead growth in natural and organic energy bars
- Sales of energy bars and gels
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- Figure 33: Sales of energy bars and gels, at current prices, 2009-11
- Manufacturer and brand sales of energy bars and gels
- Natural and organic combined
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- Figure 34: Selected brand sales of natural and organic energy bars and gels, 2010-11
Segment Performance and Brand Share—Refrigerated Non-dairy Beverages
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- Key points
- Non-soy beverages drive growth in the refrigerated non-dairy segment
- Sales of refrigerated non-dairy beverages
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- Figure 35: Sales of refrigerated non-dairy beverages, at current prices, 2009-11
- Manufacturer and brand sales of refrigerated non-dairy beverages
- Natural and organic combined
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- Figure 36: Selected brand sales of natural and organic refrigerated non-dairy beverages, 2010-11
- Organic (70%+)
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- Figure 37: Selected brand sales of organic refrigerated non-dairy beverages, 2010-11
Segment Performance and Brand Share—Cold Cereals
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- Key points
- Natural and organic cold cereals show lackluster growth
- Sales of cold cereals
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- Figure 38: Sales of cold cereals, at current prices, 2009-11
- Manufacturer and brand sales of cold cereals
- Natural and organic combined
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- Figure 39: Selected brand sales of natural and organic cold cereals, 2010-11
- Organic (70%+)
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- Figure 40: Selected brand sales of organic cold cereals, 2010-11
Segment Performance and Brand Share—Frozen Lunch and Dinner Entrées
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- Key points
- Consumers return to natural and organic frozen meals in 2011
- Sales of frozen lunch and dinner entrées
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- Figure 41: Sales of frozen lunch and dinner entrées, at current prices, 2009-11
- Manufacturer and brand sales of frozen lunch and dinner entrées
- Natural and organic combined
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- Figure 42: Selected brand sales of natural and organic frozen lunch and dinner entrées, 2010-11
Segment Performance and Brand Share—Cookies and Snack Bars
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- Key points
- Cookies and snack bar segment may be on the rebound
- Sales of cookies and snack bars
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- Figure 43: Sales of cookies and snack bars, at current prices, 2009-11
- Manufacturer and brand sales of cookies and snack bars
- Natural and organic combined
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- Figure 44: Selected brand sales of natural and organic cookies and snack bars, 2010-11
- Organic (70%+)
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- Figure 45: Selected brand sales of organic cookies and snack bars, 2010-11
Retail Channels
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- Key points
- Mass market retailers gain NOFB shoppers
- Retailers ramp up focus on health
- Drug stores and Target expand fresh food offerings
- Sales of NOFB, by channel
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- Figure 46: Retail sales of NOFB, by channel, 2009 and 2011
- FDMx sales of NOFB
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- Figure 47: FDMx sales of NOFB, at current prices, 2009-11
- Natural and specialty food retailers’ sales of NOFB
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- Figure 48: Natural and specialty food retailers’ sales of NOFB, at current prices, 2009-11
Retailer Case Studies
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- Key points
- Overview
- Whole Foods Market
- Focus on value
- Smaller stores, urban locations
- Health Starts Here
- New animal welfare standards
- Whole Foods Market well-positioned with its core customer base
- Whole Foods Market sales
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- Figure 49: Whole Foods Market total and comparable store sales, 2005-12
- Figure 50: Whole Foods Market total and comparable store sales, by department, 2008-10
- Trader Joe’s
- Duane Reade/Walgreens
Innovations and Innovators
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- Key points
- Snacks and beverages lead new product introductions
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- Figure 51: Natural and organic food and beverage product launches, by category, 2007-11
- Growing claims
- All natural
- GMO-free
- Fair trade organics
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- Figure 52: Natural and organic food and beverage product launches, by top claims, 2007-11
- Private label innovations taper off
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- Figure 53: Natural and organic food and beverage product launches, by private label, 2007-11
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- Figure 54: Natural and organic food and beverage product launches, by top five companies/brands, 2007-11
- Figure 55: Natural and organic food and beverage product launches, by next five companies/brands, 2007-11
- Product innovations
- GMO-free
- Better-for-you snacks
- Indulgent snacks
- Private label natural
- Functional foods and beverages
Marketing Strategies
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- Key points
- Social media and alternative campaigns
- Daily deal coupon sites move into grocery marketing
- Chip brands make creative use of social media and integrated marketing
- Traditional media and integrated campaigns
- Greek-style yogurt ad wars begin
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- Figure 56: Chobani. Man rides bike to plant, television ad, 2011
- Green ads for green products
- Coke and Pepsi push their natural brands
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- Figure 57: Frito-Lay. Tostitos surprisingly simple, television ad, 2011
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- Figure 58: Glaceau VitaminWater Zero Glow. Toad kisses woman, television ad, 2011
- Figure 59: Glaceau VitaminWater Revive. Boy recalls night out, television ad, 2011
Appendix—Trade Associations
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