No Fads Here
If you think natural and organic foods and beverages are nothing more than a passing fancy, take note: The products have seen robust growth between 2010 and 2013. During that period, dollar sales of natural products grew at an average annual rate of 9 percent, while dollar sales of organic products grew at an average annual rate of 7.8 percent, says Susan Viamari, Times & Trends editor with Information Resources Inc. (IRI), Chicago.
Viamari goes on to note that nearly one-third (30 percent) of IRI’s 2012 Food & Beverage New Product Pacesetters — which comprise the best-selling launches of 2012 — touted natural and organic ingredients.
Trends with traction
Natural foods remain of growing importance in consumers’ diets, with more and more people turning to these products for prevention of illness rather than for treatment, says Diana Cowland, health and wellness analyst with Euromonitor in London.
“Illnesses such as obesity, diabetes and cardiovascular diseases are increasing the need to take more preventative measures by incorporating healthier food options into one’s daily diet,” she states.
And retailers don’t have to sacrifice flavor when developing an all-natural formulation. Jason Dabrow, director of operations with Chelten House Products, Bridgeport, N.J., says his company’s line of all-natural ethnic cooking sauces — which is made with quality ingredients and contains no MSG or preservatives — continues to grow.
“We are producing sauces that make it easy to cook at home and really demonstrate authentic flavors the culinary consumer expects,” he says.
But despite experiencing sales growth between 2010 and 2013, organic foods haven’t been without their own struggles — particularly with the economic downturn still taking a toll on Americans. Cash-strapped consumers are second-guessing their organic purchases.
In fact, a number of brands have traded out products with an “organic” label for products that are labeled as “natural,” Cowland states. Recent studies about organic foods suggest that organic products aren’t substantially better for consumer health. Moreover, consumers still perceive the “natural” label to hold health benefits.
Consumers are willing to make an exception when it comes to baby food, though. The category has been able to maintain strong growth, Cowland states, and consumers have become averse to any perceived health threat among children’s products.
“While adults are limiting personal expenditure on organics, they are very forgiving towards the 15 percent price premium of organic baby food if it means limiting exposure to pesticides and safeguarding the health of their developing children,” she states.
Trends on the horizon
Looking at next year, Dabrow notes that ethnic products produced with a clean ingredient deck or GMO-free ingredients are expected to trend.
“Pepper-based sauces such as Sriracha continue to gain momentum — whether on [their] own, paired with a fruit flavor or as a sub-ingredient. You see these being offered more and more in the foodservice sector, and I think that will continue to transition to the grocery aisle,” he says.
And although a number of natural and organic foods and beverages might appear to be somewhat drab, they are just starting to get a little “fun and indulgent.” Expect the category to become more so in 2014, says Kazia Jankowski, an associate culinary director at Sterling-Rice Group, Boulder, Colo.