Progressive Grocer Product

Fall 2014

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Organic and natural 36 Progressive Grocer Products Showcase / Fall 2014 aving long shed its niche, granola-loving reputation, the market for natural and organic foods has become mainstream while products extend into nearly all retail outlets and numerous categories in both food and non-food. Millennials index high against the general population (≥ 120) for use of store-brand organic foods and beverages Natural and Organic Growth Natural and organic products continue to grow, catering to a broad consumer group interested in health and wellness. And the market is sizeable – according to SPINS, in calendar-year 2013, natural food and beverage generated $34.9 billion while organic food and beverage brought in $9.4 billion. Combined natural and organic products pack a big punch to the tune of about $45 billion, with growth reported. SPINS reports that from 2012 to 2013, natural snacks alone grew 14.2 percent, with total natural food and beverage products combined to generate a 10.6 percent increase. In organics, SPINS reports a 6.9 percent increase in organic snacks, with the total organic segment up 12.4 percent. According to Chicago's IRI, growth in this market for the past few years has outpaced total industry growth, with much thanks given to a steady pace of product introductions for consumers of all ages, and even species. From baby food to pet food, consumers are focused on health and wellness, as well as considerably purer ingredient listings. Progressive Grocer's 81st Annual Report of the Grocery Industry pointed to the infuence of natural and organic in stores. Original market research conducted for the report had "organic" squeezing into the top seven store departments that are most successful at generating sales. The gourmet specialty/natural food department contributes positively as an infuence on a retailer's stores' overall brand/image/point of diferentiation, according to the report. Another Progressive Grocer report from early spring this year indicates organic products are and will continue to play a big part in the supermarket landscape. "Organics are an entrenched part of the national discourse, and supermarkets are squarely on the hot seat when it comes to helping shoppers feel good about both sides of the coin in the bid to elevate organics alongside their conventionally grown and produced counterparts." The growth and mainstreaming of natural and organic products in recent retail history is indicative of consumer trends, in particular a broad-reaching focus on health and well being. The expectation is that this segment will continue to play a signifcant role in product development and continue to strengthen its roots far beyond specialty stores, in-store special departments and niche-focused retailers. PGPS Source: NMI's 2013 Health & Wellness Consumer Trends Database 61% 61% 47% 56% Conventional brands of organic food and beverages Store-brand organic foods and beverages 9% Growth 9% Growth n 2007 n 2013

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