WHO ARE ORGANIC FOOD CONSUMERS?
A COMPILATION AND REVIEW OF WHY PEOPLE PURCHASE ORGANIC FOOD
R. HUGHNER, P.MCDONAGH, A.PROTHERO, C.SCHULTZ, AND J.STANTON
PRESENTED BY: COURTNEY JONES 4.31.14 ADV. ORGANIC FARMING- J. FERNANDEZ
Outline of the conversation
• Consumer Motivations• Consumer Profiles• Determinants• Current & Future Research
The Market
• Changing Face of Organics• Strategies of the NOSB vs. NOAPThe Future
• The Global Conversation• The Human Impact of Emerging MarketsThe Impact
Driving Factors:
Chemical-free
Health
Taste Food Safety Nutrition
Wholesomeness
Local EconomyEnvironmental
Concern
Animal Welfare
Fashionable Nostalgia
Curiosity
Researchers agree on these general themes amongst consumer concerns and motivations to buy organic.
They also agree on some overwhelming trends among organic consumers that influence these thought patterns.
• Everyone interprets the term “Organic” differently.
• There is widespread confusion about organic methods
• Beliefs are largely subjective and often not factual
• Women make up the majority of consumers and often
begin purchasing organic with the arrival of a baby.
• Demographics are not effective: race, socioeconomic
status, and education are not always determinants
MARKET PROFILES
• Associates health with diet
• High internal locus• Environmental and
animal welfare concerns
• Positive attitudes towards cooking
• Alternative lifestyle• A “way of life”• ‘Coop’ shopper
RCOF
• Health is a concern• Motivated by personal
pleasure• Price difference is a
deciding factor• Select specific
categories to buy• Link higher price to
higher quality• Shop at conventional
markets or both
OCOF
• Content with conventional foods
• Unwilling to pay a premium
• Perceive no difference between organic and conventional
• Dislike imperfections in produce
• Lack of availability• Skepticism
NCOF
Hughner, S. Et al. J. Consumer Behaviour 6: 94-110 (2007)
PROBLEMS WITH THE STUDY…
• 7 Years ago, studies cited were from 1990 to 2004
• 7 out of 33 studies referenced were from Europe
• Majority were written or mail-in surveys (non-response bias)
• Difficult to estimate the actual size of the organic market (narrow scope)
• “Motives” are subjective opinion and undefinable ie. What was meant by food safety? Health? High Prices relative to what? Tastes better-which product? (milk vs. OJ)
• Anything Else?
THE HARTMAN GROUP: MARKET RESEARCH CONSULTANTS PRICE POINT AND WILLINGNESS TO PAY
http://www.hartman-group.com/pdf/Organic%20Consumer%20Webinar%20Sept%2009.pdf
Organic Usage (by Income) Index
Under $30,000 89
$30,000-$49,999 94
$50,000-$69,999 108
$70,000-$99,999 113
$100,000+ 116
All Consumers 100
http://www.hartman-group.com/pdf/Organic%20Consumer%20Webinar%20Sept%2009.pdf
Organic Usage (by Race/Ethnicity) Index
Caucasian (White) American 98
Latino/Hispanic American 117
African (Black) American 97
All Consumers 100
*Cathy Durham referenced the Tuskegee study (c. 1932) as an example of minorities’ distrust of government health and safety measures being a possible factor in a higher than expected consumption of organics in the African American population? Why do you think Latin American individuals indexed above the norm?
In Transition… A Question of the NOAP:How can we facilitate the growth of organic food and agriculture while preserving organic integrity, maintaining diverse farms and agricultural systems, retaining farmer and customer confidence, and Furthering broader social and environmental values?
2010 US Organic Production
conventional organic
Market Research Factors:
• Little research has been done on HOW people learn about organic production methods.
• More needs to be learned about the largest and fastest growing “OCOF” consumer because this group will shape the future market.
-Do they have adequate access to organics?-Where do they get their information?-Would more informational marketing increase their willingness-to-pay the premium and/or interest in the environmental-social aspects of organic agriculture?
THE FUTURE OF ORGANICSGRASSROOTS TO BIG BUSINESS
“Organic isn’t about scale, it’s about adhering to the principles of producing food without synthetic chemicals, and with a respect for sustaining the land and water used to grow that food. As retailers put more organic food on their shelves, the incentives for commercial-sized farms to master organic principles, and to convert to organic production, will only increase.”-Dave Carter, wildoats.com spokesman, former NOSB chair
“History will not only judge us by how well we managed our resources but also by how well we defended opportunities of future generations. Now is the time for us to set the course.”-Michael Sligh, RAFI-USA & Founding Chair, USDA NOSB and 2010 co-creator NOAP
THE GROWING ORGANIC DIVISIONS
NATIONAL ORGANICS ACTION PLAN
• Why NOAP Now?
As U.S. organic agriculture expands and matures, civil society must assert itself in policy discussions about what is and what is not organic or risk having the definition and practice undermined by those without the commitment to socially and environmentally responsible organic development. We believe that a successful, transparent, and participatory NOAP process can provide a way to periodically evaluate the role and performance of the government and to update and strengthen organic regulations.
*Reflects the broader goals of organic agriculture including social/environmental, including access to healthy food to people of all income levels.
VS. USDA ORGANIC
1. Develop, implement, and maintain a quality management system (QMS) for the efficient and effective operation of the NOP
2. Develop and communicate clear and consistent NOP standards.
3. Enhance compliance with and enforcement of organic regulations.
4. Ensure consistent application of the NOP regulations by certified organic operations through the accreditation and oversight of ACAs, State Organic Programs, and via International Agreements.
5. Effectively manage the human resources, communication, and administrative activities of the NOP, and support cultural transformation efforts within the NOP team and in AMS overall
*A solely retail/market-based focus, the commodity model.
http://www.rafiusa.org/docs/noap.pdf http://www.ams.usda.gov/
THE ISSUE
Will the reduction in premiums and ease-of-access in organic agriculture lead to the crowding-out of more prudent, ecologically sound, socially responsible systems such as direct sales at farmers markets, CSA’s, and small-scale family farmers?
Dimitri, C. and Greene, C. Recent Growth Patterns in the US Organic Foods Market. USDA Economic Research Service. http://www.ers.usda.gov/
WHAT NOW? EXISTING STRATEGIC MARKETING
Existing Consumer Education Initiatives:
• Organic Consumers Association- A grassroots non-profit consumer interest organization:
“While we oppose the "Walmartization" of organic, we are happy to see that even our adversaries are being forced to market and sell organic products. While OCA's campaigns against worker abuses, GMOs, factory farming, and the many poisons used in industrial food production, are aimed at tearing down a deadly system, our work to keep organic standards strong guarantees that even the big corporate players must "play by the rules" if they are to call their products organic.”
• “Organic: It’s Worth It” - Organic Trade Association Campaign
• Wikipedia, blogs
• Whole Foods, Specialty Markets
WHAT DO WE NEED?
PROACTIVE STRATEGIC MARKETING
#1 point: Consumers are confused!
http://www.hartman-group.com/pdf/Organic%20Consumer%20Webinar%20Sept%2009.pdf
RCOFCSA, Farmer’s Market, Coop,
Natural Food Stores
OCOFConventional Supermarket
NCOFConventional Supermarkets
Could organic ever outgrow conventional in the U.S. and what would the many faces of that market look like?
RCOF
OCOF
NCOF
THE HUMANIMPACT“Our research has proved that contrary to the dominant assumptions; ecological agriculture is highly productive and is the only lasting solution to hunger and poverty.”
~Vandana Shiva
“Food is the moral right of all who are born into this world.”~Norman Borlaug
• Price reductions could make chemical-free food affordable for low-income families in the U.S. and provide a slightly more ecological model for importing producers where that cheaper organic is coming from.
• Workers on large scale farms and surrounding environments exposed to fewer toxins.
• The ballooning of organic could make more people ask the question “what exactly is the meaning of organic”?
• Greater market value could expand university education and extension.• Expansion of organic methods into developing markets could lead to greater food
security in vulnerable markets in least developed countries.• Organic gardening and farming education programs are creating community and
nutrition education opportunities for our children, which will in turn produce more educated organic consumers and producers in the future.
Global Organic… “Organic certification represents a regulated marketmechanism with the potential to stimulate ecologically based agricultural research, extension, and investment.Recent linkages between the global organic food industry and local agricultural development in China provide anopportunity to test this potential.1 “
Challenges and Opportunities
1. Thiers, P. "Using global organic markets to pay for ecologically based agriculture“ 2. http://www.fao.org/ag/magazine/9901sp3.htm
Organic Education.. “Lack of information is a major obstacle to organic conversion,
according to 73% of North American organic farmers. Extension personnel
rarely receive adequate training in organic methods and studies have
shown that they sometimes discourage farmers from converting.2”
“Organic is now being recognized as a climate and environmentally friendly way to farm.” ~NOAP
“In U.S. government parlance, organic must never be seen as better
than conventional agriculture—it is only a
“niche market”. ~NOAP
Food for Thought…”establishing full-cost accounting
systems to better quantify and promote the real benefits of organic agriculture,
and to highlight the real costs associated with so-called “cheap foods,” stands out as
a major challenge with great potential payback.” ~NOAP
