The Natural Products Expo: Consumer demand for organic and plant-based products continues to outpace conventional in every market segment

The sixth and final of 6 blog posts from inside by Ben Brown and Terry Gips from the Alliance for Sustainability (www.afors.org

In nearly every natural products industry segment, from fresh and frozen food to beverages, supplements, and pet products, the final resounding theme is that people increasingly care about purchasing products identified as plant-based or organic. Consequently, the demand for plant-based and organic products continues to grow at a double-digit level, outpacing the growth of each general market segment they’re in. 

The Plant Based Foods Association found that plant-based food sales grew by 27% in 2020, almost twice the 15% that the total U.S. food retail market grew by. Plant-based milk sales grew 20%, while plant-based meat grew 45%. The Organic Trade Association reported that organic products grew at a rate of 12% in 2020, more than double the total U.S. market for food and non-food products at 4.9%.

While organic and plant-based alternatives have been continuing their strong growth for a long time, the shift towards them was vastly accelerated by the pandemic – and judging from the sentiment of the Expo’s participants, the dramatic pace of the shift is here to stay. Throughout the past year, organic products and plant-based food products alike have vastly outpaced similar, non-organic alternatives.  

Looking at the industry overall for 2020, the natural and organic products industry grew 12.5% to reach $259 billion, up from the 5% growth it experienced in 2019. Data technology company SPINS shared research showing that naturally positioned products are growing 9.8% year over year and specialty & wellness positioned products 14.1% – both of which outpace the 6.3% year over year growth of conventionally positioned products.

Eve Turow-Paul explored the shift in people’s underlying psychology in the past year as there’s been an uptick in how much consumers care about the quality of products they are purchasing. Why? For one, anxiety levels about everything are at an all-time high, from 75% of people anxious about food security to 60% concerned about terrorism. 

She pointed out that for these people, solutions to such issues are often out of their immediate control, leading them to seek to regain that control elsewhere. This can come through controlling the products they buy, what they put in their bodies and what they use around the house. And given the pandemic’s impact on health, consumers have a renewed focus on both present and future health.

The growth and success of the natural products companies committed to sustainability are proof that the consumer mindset is changing. If there wasn’t money to be had, there wouldn’t be businesses flooding in the door to capitalize.

Summary

The natural products industry is having to contend with numerous challenging issues – from Covid and JEDI to the climate crisis and changing consumer preferences. The silver lining is that within all that lies an opportunity. Natural products companies have the chance to reap the benefit of more inclusive workspaces, a new age of consumerism that cares about how a company treats its employees and the earth, and being pioneers in combating the climate crisis – all opportunities that will simultaneously improve their bottom line and the future of the planet for all. 

Leave a Reply

Your email address will not be published.