The picture still appears a little gloomy for organic fresh produce, with the category experiencing a decline of 6.5 per cent in value and 9.9 per cent in volume, according to Kantar Worldpanel.
However, industry insiders and the Soil Association insist the data is misleading, quoting their own sales figures as counter evidence. “This is in line with the overall market, which has some winners some losers, but in [organic] produce fruit is up by two and a half per cent and veg is down by eight per cent,” says Adam Wakeley of Organic Farm Foods. “We are up 10 per cent as an organic fruit business, so sales growth is being distorted by ranging.”
Wakeley finds the sales decline reported by Kantar “surprising” given that the organic consumer spends three times as much per shopping basket than non-organic consumers, and the combined value of these total baskets are worth £10bn. “Retailers should consider improved ranging to attract more organic consumers to win a better share of the total available £10bn spend,” he adds.
In terms of current price levels and promotions, Wakeley thinks there are too many unnecessary promotions which only devalue organics. “It’s less about the price point and more about the message.”
Andrew Burgess, director of agriculture at Produce World, agrees that sales performance varies across the crops. “At a total level organic has seen a decline due to fewer consumers buying less often, and this is often reported as a result of the financial pressures that consumers face,” he says.
“However, individual categories have performed in different ways; organic carrots have seen their purchase frequency increase 4.6 per cent as consumers buy more often. In particular, Sainsbury’s and Waitrose have had strong value growth from organic carrots in the last 52 weeks, with a 3.8 per cent and 12.4 per cent increase respectively. It would seem that consumers still see real value in organics in key product groups and are as committed as ever to these.”
The future success of organic is dependent on retailers working with their organic suppliers to ensure that the benefits of organic remain top-of-mind for consumers, thinks Burgess. “The retailers Produce World works with are really committed to organic, and the growth in organic carrots shows that this is working for them and their shoppers.”
Going forward, Burgess expects continued growth from organic carrots but admits that the UK is unique in having a shrinking organic market. “The rest of northern Europe continues to grow even though the organic share is already higher than the UK. The biggest challenge the UK market has is this season’s weather, which is making production extremely challenging, to say the least.”
Meanwhile, the Soil Association firmly stands by its conviction that the organic market is, if not buoyant, at least stable and that demand remains strong among committed organic consumers.
“The total organic market has been fairly stable for around 10 months despite still showing an overall year-on-year decline of six per cent,” says the organisation’s Finn Cottle. “Within this figure, the organic produce market performance, according to Kantar data, is showing a decline of 6.5 per cent, however it is important to highlight that this is supermarket data.
Other sectors for organic produce are doing extremely well including box schemes and home delivery through online shopping, which recorded a 7.2 per cent increase in organic sales overall. There is a much greater loyalty in these channels and one assumes the guarantee of greater choice and availability is motivating the consumer.”
Cottle thinks supermarkets should look at the box schemes for inspiration. “The performance of the non-supermarket sectors builds a lot of confidence in the future potential. Where there is extensive choice and availability, organics are selling well. Supermarkets should re-engage with consumers and promote the benefits of organic to re-stimulate demand.” -
CELEBRATING BRITISH
With the Olympics kicking off this weekend and all things British in the spotlight like never before, British Food Fortnight could not have been better timed to give conventional and organic producers a boost. Michael Barker reports
his weekend, the eyes of the world will be on Britain, giving the nation a unique opportunity to showcase everything that’s good about these shores. From tourism and hospitality to shopping and culture, every industry will look to leave a good impression in the eyes of the millions of visiting tourists and billions more watching on TV around the world.
For the food industry, celebrating the nation’s cuisine is an annual event, and this year British Food Fortnight is perfectly timed to coincide with the London Games. Around the country, promotions, food festivals and special events will put home-grown food on a pedestal for all to see, and with even the sun looking like it is finally coming out to play, it augurs well for giving a much-needed boost to the sector.
British Food Fortnight’s website is awash with Olympic advice, and the organisers’ message is clear: this is a once-in-a-lifetime opportunity to see lasting sales growth on the back of the event. It is estimated that £2 billion could be generated, with almost two-thirds of this sales growth coming in the four years after the Games. “Being involved will generate as much profit as if it were Christmas,” BFF organisers state. “And every day will be a weekend in terms of customer expectations and purchasing patterns.”
The caterers have certainly given enthusiastic backing to this year’s event. Sodexo, Brakes, 3663, Compass and Aramark are all among the companies running campaigns backing British and encouraging consumers to ‘Love British Food’. And the retailers are expected to make a full contribution too, with Tesco having signed up to become an official partner of Love British Food 2012.
While there are strict, and some would argue draconian, laws on what businesses are allowed to do in terms of promoting any connection with the Olympics, BFF organisers say tying in promotions with British Food Fortnight is the ideal way of gaining good publicity while not infringing the law. Words such as ‘Olympics’, ‘Javelin’, ‘Team GB’ or images of the London skyline or five rings cannot be used on any promotional material, but classic British recipes or local food events can be run to help consumers get into the spirit of the occasion.
Around the country hundreds of events have been lined up and the message is clear - this is an unmissable opportunity for the industry to put the miserable spring behind it and put its products firmly on the top of the podium. -
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