As a result, sales in the organic and natural channel are booming. According to recent Packaged Facts’ research, the natural channel will reach a record $69 billion by the end of this year, which is a 12% increase over the prior year. At the same time, it reports, the conventional channel is holding steady at best.
A subsection of this segment is Organic, sales of which the Organic Trade Association just announced reached a new high of $43.3 billion in 2015. This is up a robust 11% from last year’s also record level – allowing the segment to capture 5% of the overall US market food share.
But beyond a general perception that natural and organic foods are healthier than conventional food, what is driving consumer interest in this space and more importantly what will drive product innovation in 2017?
In this episode of FoodNavigator-USA’s Soup-To-Nuts Podcast, Jim Emme, CEO of NOW Health Group, outlines five major trends that he says are the backbone of innovation in the natural and organic channel and will continue to drive sales through next year.
These include:
Truth in labeling – Transparency is the foundation of building consumer trust – and sales – in the natural channel. Emme argues that transparency means clearly labeling what is in the product, including GMOs if they are present. He acknowledges that views on GMOs vary, but says providing consumers that added layer of information empowers them to decide what products are right for them. Being transparent also includes adequately testing products to ensure that the ingredients are the highest standard and that consumers receive what they believe they are buying.
Probiotics – Consumers now understand the importance of gut health in building immunity and ensuring that their bodies are in top condition. As such, Emme says they will continue to demand more probiotics in different formats that deliver specific values, such as for immunity, skin benefits or digestive wellness. Consumers also are demanding higher quality probiotics, and to ensure that NOW provides the correct strains, Emme said the company uses Dupont’s RiboPrinter System to “fingerprint” and better identify the different strains and other microorganisms in products and ensure their purity.
Stress-relievers – Citing data from the American Psychological Association, Emme notes that in 2015 24% of adults said they were highly stressed – up from 18% the prior year. As a result, consumers increasingly are looking for foods and ingredients that can help them relax, including popular adaptogens such as Maca, Rhodiola, Ashwagandha, Panax Ginseng and Eleuthero. Ashwagandha, in particular, is a breakout star with SPINS data noting product with the ingredient launched in year ending in October 2015 were up 57.3%, Emme said.
Plant-based and vegan options – Consumers increasingly associated being vegan with being healthy – prompting many to reach for more plant-based, vegetarian and vegan alternatives to animal products, Emme said. This trend already is in full swing, but likely will continue to grow – particular in the sports nutrition and general fitness categories. This creates opportunities for different plant-protein products, including NOW Sports’ Plant Protein Complex, which offers a blend of pea, brown rice, hemp and quinoa protein sources, Emme said. An added benefit of plant-based proteins is they are recognizable to many consumers, and therefore perceived as clean options.
Easy options – Consumers clearly want healthier options, but many also don’t want – or are unable to change their lifestyle to accommodate better-for-you products, Emme said. That is why, he notes, it is important that manufacturers offer these products in formats that are convenient, portable and fit into shoppers evolving habits of reaching for smaller snacks throughout the day, rather than the traditional three square meals.