Is your store still separating natural and organic products? Years ago, separating these types of foods in a small area or areas of a grocery store was the norm. After all, only a small segment of shoppers was looking for a selection of products certified as organic or minimally processed (or unprocessed) without artificial ingredients or added colors.
These days, deciding not to integrate natural and organic products throughout a grocery store could make an impact. Consider this: 99% of U.S. households made a natural and organic purchase in the past year, according to SPINS.
The growth of Natural & Organic
You probably already know that natural/organic product sales nationwide are climbing and that products with attributes that align with natural/organic have shown a higher year-over-year growth rate than overall grocery sales.
That’s true.
But what you may not realize is that consumers of all ages and incomes are seeking out and purchasing at least some types of natural and organic foods. They may not be filling their entire baskets with these types of products, but they are purchasing at least some or in a growing number of cases —many — natural/organic products each time they shop.
This is a trend that has accelerated during the global pandemic.
As a result, U.S. organic product sales — food and nonfood —climbed 12.4% in 2020 to $61.9 billion, according to the Organic Trade Association. That’s a record high and the first time the category has broken through the $60 billion threshold. Adding in natural and functional foods & beverages as well, the total was $186 billion for last year, up 13%, according to New Hope Network, a provider of news and information for businesses in the natural products industry.
Definitions of functional foods vary but often are described as foods that have health-boosting benefits beyond nutrition, such as probiotics or prebiotics that can promote gastrointestinal health.
Shoppers are looking for natural, organic and functional foods in all parts of the store — fresh, frozen and shelf-stable. Studies show consumers are willing to experiment until they find the natural/organic products they like, that taste good and that meet their lifestyle or dietary constraints. And they’re also seeking out non-food items such as body care. To meet consumer demand, the supply of available products has proliferated (the selection of dairy-free milk alternatives being a great example) and today these products are higher quality and more attractively packaged than ever before.
Why you should integrate
Integrating natural/organic products with conventional products can benefit your store in many ways. For starters, it easier for shoppers to find the products they are looking for. They can easily compare prices and ingredients/attributes of natural/organic vs. conventional. Integration also makes it easier to discover new natural/organic products shoppers might not otherwise have had found. For example, studies have shown that plant-based burgers sell significantly better in the meat case than when isolated in a separate area for meat alternative products. Do people buy both? Yes — a growing number of Americans are considered flexitarians — for health and sustainability reasons they eat mainly plant-based foods but they also eat meat.
Integration also makes sense given the fact that while few households are purchasing only natural/organic products, nearly all households are purchasing at least some. Natural/organic is on the radar of nearly all households, and most shoppers are making strategic choices each time they shop regarding which types of natural/organic products to purchase based on a number of different factors, such as price, where the product is in the store, how it’s showcased, signage, their or their family’s diet and specific health concerns.
Conclusion
While integration has grown in popularity and businesses are starting to, or have already, implemented this strategy for their natural/ organic products, many have continued to keep these products separate. We understand that every business is different and we have the knowledge and tools to assist with both. Our Shelf Management team has the expertise and understanding of many different strategies, so we are the right team to recommend a new strategy or help perfect your current one. Is your store effectively integrating natural/organic products? Are you showcasing them properly? Do you want to better optimize your current layout? At UNFI Professional Services, we’re here to help. E-mail us at [email protected].
