Last September, Suzanne wrote a blog post called “Organic” needs a re-brand. In it, she highlighted a sampling of quotes from our Pulse Focus Groups:
- “I think everything’s organic — isn’t the definition of organic that it grows?”
- “Once you add plastic to a product you’re taking away some of the organic.”
- “Aren’t all bananas organic anyway? They all come off trees.”
“A cereal box can say it’s certified organic, but read the ingredients and you’ll see it still has just as much sugar and all the added preservatives of the non-organic cereal … and it’s way more expensive.”
These quotes exemplified the consumer confusion surrounding the term “organic” with their absolute confidence that they knew “exactly what they were talking about” being the kicker. It’s almost a year later, and while we’re seeing continued interest in organics, we’re not seeing an uptick in organics purchase behavior.
In our soon-to-be-published Eco Pulse™ 2012 study, 54% of Americans chose either “100% organic” or “USDA–certified organic” as one of the best descriptions to read on a food product label – while 42% said that they are seriously searching for “greener” food products. Only 19%, however, said that they most often buy organic produce or beef (compared to 22% in 2011). So what’s the disconnect?
We frequently hear this complaint in consumer focus groups, so we took a trip to our local Kroger this week to investigate. There, we found these price premiums for organic foods:
BABY FOOD – 54% Premium
Gerber regular 7 oz./2 pack: $1.09 (sale price)
Gerber organic 7 oz./2 pack: $1.63
MILK – 33% Premium
Mayfield 2% gallon: $4.49
Simple Truth 2% organic, gallon: $5.99
YOGURT – 20% Premium
Dannon Light and Fit Vanilla yogurt, 32 oz, tub: $2.49
Simple Truth organic vanilla yogurt, 32 oz. tub: $2.99
So yes, organics most often cost more – sometimes significantly more. Is that fair? I will say that we’ve heard some heart-breaking feedback on this issue. In a focus group I facilitated last year, one woman, near tears, said, “It’s not right that poor people can’t afford to buy good food for our children.”
Egalitarianism aside, there are definitely higher costs associated with organic farming practices and food product manufacturers must make a profit; however, it’s probable that organic pricing would decline if more people were buying organics. And we see a growing number of consumers who would be willing to pay more for organics if they could simply see the value proposition. So how do you do that?
You might think it’s as simple as education. Our 2012 Eco Pulse study found that approximately thirty percent of consumers are intentionally avoiding content like MSG, additives, preservatives and growth hormones in their food. So you’d think if organic food makers simply put these facts on their packaging, they’d get the message across and organics would fly off the shelves. Well, they are putting those facts on their packages and sales still don’t match the intention and interest we see in our studies.
Given that buying organic is essentially about buying peace of mind, organic food makers should consider elevating the importance of the USDA Organic label — elevating it to a trustmark. In much the same way we all once became convinced that we shouldn’t buy a computer without Intel Inside, organic food makers should work to convince consumers that the USDA Organic label is the only way they can really know a product contains none of the stuff they don’t want and more of the stuff they do. In the long run it will go a long way towards selling-in the premium.