Posts Tagged “Nielsen”
Organic fresh produce is booming despite total grocery store dollar growth may have climbed only two percent in the last year.
The Organic Produce Network (OPN) and Nielsen, have released new data showing organic produce sales have set new records, totaling $5.6 billion in 2018, far exceeding the status quo. And the year ended on a particularly high note as sales soared 13 percent the final week of the year.
The OPN notes it is particularly interesting is an impressive two-thirds of all produce commodity groups increased organic sales year-over-year which indicates this is not an isolated incident. At the same time, organic growth occurred in these three categories despite a decline in conventional sales.
According to a press release, fresh produce represented 26 percent of total store organic sales, and a growth rate of 8.6 percent was on par with total store organic, suggesting a continued movement toward mainstream demand across product consumption.
In terms of absolute dollars, blueberries saw the greatest increase followed by prepackaged salads. Many popular organic categories exceeded $20 million in dollar growth—among them organic bananas, apples, and grapes.
“Although organic accounted for 10.1 percent of total produce sales, it’s driving a disproportionate amount of growth within the produce department,” said Matt Lally, Associate Director at Nielsen. “In total, 43 percent of total produce growth occurred from organic items which equates to an additional $450 million sold.”
OPN noted in its press release, organic isn’t a given recipe for success. Products like strawberries and tomatoes experienced far greater growth in the conventional offering, but a closer look reveals how important pricing is for these categories. Prices varied widely—ranging from $1.97 to $3.38 per pound between conventional and organic tomatoes and $2.26 to $4.26 for conventional and organic strawberries.
“When you compare this difference with commodities that experience a high organic growth rate such as grapes, the difference is striking,” noted Lally “Conventional grapes rang in at $2.18 per conventional pound compared to $2.94 per organic pound. Clearly there’s a strong connection between the growth of organic and the price premium with its conventional counterpart.”
In addition to room for growth in the strawberry and tomato category, onions, bell peppers, watermelon, and mandarins are all disproportionately under-represented in organic sales compared to the total produce average. And OPN noted that making organics widely available during key periods like summer holidays, Thanksgiving, and Christmas is a great way to reach more shoppers.
Soda and non-fresh juice sales are flat or slipping slightly, but plant-based products like coconut water — along with other alternative beverages such as kombucha and tea-based drinks — are growing, particularly those sold alongside your fruits and veggies, according to data compiled by market research firm Nielsen.
“The one area of the store where we are just seeing phenomenal growth is the produce department,” says Sherry Frey, health and wellness expert for Nielsen.
Coconut water has been big for a while, after being introduced several years ago. Maple water is a newer entry and is essentially maple sap, the stuff that normally is boiled down to syrup. Brands include Vertical Water and SEVA. And that’s not the only tree water on the market. There’s also birch water and, on the plant side, cactus, barley and artichoke waters.
Sales of all waters, including the new products, “fitness” and enhanced waters, as well as regular sparkling and still, grew 4 percent by value and nearly 7 percent by volume since July 2013.
Coconut water is not yet being tracked specifically, but totals for beverages in the produce department, which is where much coconut water is sold, showed double-digit growth. The value jump for all produce section beverages — which includes smoothies, fresh juices and teas as well as water — was nearly 13 percent.
Why the sudden thirst? Nutrition expert and registered dietitian Tina Ruggiero sees it as a trend driven by the beverage industry’s desire to find the next big thing, as well as consumers’ interest in finding natural alternatives to soda. “This natural beverage market just presents a tremendous opportunity,” she says. “There is a fight to create the next best-selling natural water.”
All of the brands promise unique nutrition benefits, but Ruggiero advises clients to read labels carefully, beware of the hype and watch for calorie content. Chocolate “healthy” waters may not be any better for you than some other sweetened drink.
Plant waters are fine for recreational athletes, i.e. people who exercise less than 90 minutes a day, says Ruggiero. On the other hand, you’re also fine with good old tap water — which is much, much cheaper — and maybe a banana and/or some salted pretzels.
Does all this choice in natural beverages make Americans No. 1 in hydration?
Ruggiero laughs. “I don’t know if we’re the best hydrated,” she says, “but we sure as heck spend a lot of money on bottled water and beverages in general.”