The Organic Industry has a Tremendous Opportunity for Growth, but It Would Require a New Playbook

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The Hartman Group just published Beyond Organic 2024, which may be the most comprehensive report on organic that I have ever seen, particularly as it relates to segregated shopper behavior and beliefs.

With data from nearly 3,100 participants — including a wide cross-section of different races, ethnicities and age groups — in an online survey from April 22, 2024 to May 2, 2024, the goal of the report was to understand perceptions of organic, shopping preferences and behavior, and future directions of organic.

Below are a few key areas of the report that I found very compelling and instructive.

PURCHASING HABITS AND FACTORS

While some shoppers said they have scaled back their organic purchasing due to inflation-induced budget constraints, consumers generally feel optimistic about their organic purchasing.

• 28% feel they now buy more organic than last year.
• 31% of consumers use organic products, daily or weekly, similar to 2022.
• 83% of consumers use organic products at least occasionally

Very Important Food and Beverage Characteristics:
Fresh — 65%
Natural — 42%
Simple ingredients — 41%
Clean — 40%
No artificial flavors/colors/preservatives — 34%
No antibiotics or added hormones — 32%
No pesticides or herbicides — 29%
No GMOs — 26%
Organic / USDA organic — 24%
Sustainable — 21%
Local — 20%

Barriers to buying more organic products:
They’re too expensive — 62%
Can’t tell if they’re really organic — 19%
Requirements for ‘organic’ certification are being increasingly weakened — 13%
They don’t stay fresh as long as non-organic products — 10%
Don’t really believe they’re more nutritious — 9%

Barriers to buying any organic products (for those who don’t purchase organic):
They’re too expensive — 74%
Don’t really believe they’re more nutritious — 32%
Don’t really believe they’re safer — 30%
Can’t tell if they’re really organic — 24%
Have never really considered buying organics — 24%
Don’t want to change the products we’ve become used to — 16%

PERCEPTION

Organic continues to reign as one of the most powerful symbols of natural food, but it is by no means devoid of concerns or criticism.

• While the certification represents elements of responsible production such as soil health or animal welfare, these associations are weakest.

• Most consumers have reservations about the USDA organic certification, from desiring more stringent requirements to questioning the certification’s rigor.

• Greater participation in organic by big companies, as well as the expansion of organic into more processed categories, undermines trust in USDA organic certification.

MY TAKE

Much of the data in this report points to two key takeaways.

1) Organic is clearly benefiting from being a well-known certification that has been in the consumer marketplace for more than two decades. Brand awareness is high, and there is a very significant halo around it, which allows the sector to garner trust among shoppers.

2) This halo around organic is also a double-edged sword; meaning, its success and reputation in the marketplace have also created a sense of complacency, from both the USDA organic certification program and from the industry itself.

Consumers still prioritize terms such as “fresh,” “natural” and “no pesticides” more than they do “organic.” This is a massive problem that has persisted for years, with no remedy in sight. Not having a national branding or advertising campaign for organic makes it extremely hard to educate consumers on a broad level and attract new shoppers to our industry. Both result in unrealized sales of organic products, probably in the hundreds of millions or billions per year.

Lastly, with the emergence of new certifications that are better meeting the evolving needs of organic consumers, such as Regenerative Organic Certified®, Real Organic Project, Glyphosate Residue Free or Clean Label Project, the USDA organic certification program is not adjusting to the times, and as Hartman noted in its report, many people are questioning the certification. USDA organic certification remains largely a paper-based system that does not prioritize testing and transparency, two areas that are only becoming more important by the day to organic shoppers.

According to the report, U.S. organic food dollar sales reached $63.8 billion in 2023, and this new record was achieved primarily thanks to inflation rather than unit sales.

For organic to have a much bigger impact on both human and environmental health — a goal for all of us — the way we operate will need to evolve.

With gratitude, Max Goldberg, Founder