Steve Lutz spoke about the changing organic consumer — and the value of employing some of the same marketing tactics used for conventional product — at the Global Organic Produce Expo. (Photo by Ashley Nickle)
Organic produce continues to grow in importance to the industry, contributing $5.6 billion in sales in 2018, according to the United Fresh Produce Association’s latest FreshFacts on Retail report.
That number represents an 8.7% increase from 2017, but while dedicated organic shoppers have long driven the category, growth is now also coming from a different kind of consumer.
Steve Lutz, vice president of the Produce Marketing Association, described some of the characteristics of the different shopper segments during The Packer’s Global Organic Produce Expo in Hollywood, Fla.
Light consumers of organics shop at supermarkets and mass merchandisers and focus on price and convenience, Lutz said. They value packaging. Also, they won’t hunt through the department for organic.
Heavy consumers of organics are willing to search. They’re focused on assortment rather than price, and their first consideration is to buy organic. They’re more likely to challenge retailers on packaging.
“They’re the people that are organizing the online poll to send to Trader Joe’s to say, ‘We got to get rid of these packaged apples, doggone it. There’s too much plastic in the store,’” Lutz said at GOPEX.
For years, the committed organic shoppers accounted for much of organic sales, but now that is shifting.
“My conclusion is that the opportunity for organic, the sales gains that we will see will going forward, will be generated by consumers that are different than the people who got us here,” Lutz said.
In order to capture those shoppers, retailers will need to focus on the elements most important to them — value and convenience. Attractive packaging can convey both and grab the attention of shoppers.
While organic items tend to be more expensive, there are ways to shift the price perception without giving up much on the price, Lutz said.
He gave an example from his days at Wenatchee, Wash.-based CMI Growers – organic apples. The company at one point offered a 3-pound mesh or poly bag of organic apples that would retail around $6.99, with its conventional counterpart often selling around $3.99. CMI switched to a high-graphic, two-pound bag that retailed for $4.99. Then it only cost $1 more for a shopper to opt for organic.
“By changing the equation of what we were offering and giving them a $4.99 option, we had huge sales growth,” Lutz said.