Demand Outstrips Supply in US Health, Wellness and Organic Markets
- 20 March 2012
The following article is based on a paper given by Erica Stone of New Hope Natural Media at BioFach, the World Organic Trade Fair in Germany, February 2012.
The obesity problem continues to move right across the U.S.A with no State now reporting obesity rates of less than 20%. A recent New Hope Natural Media consumer study found that the will and the want is there among American consumers to be better to be healthier – but many consumers just don’t know how to get there.
Aligned to this social problem in the past decade has been the emergence of Natural and Wellness market. The natural products industry has weathered the economic story pretty well, but there is evidence that the industry is maturing. Health and wellness products are becoming mainstream and the opportunity has never permeated all retail channels. What Whole Foods sells in 1 month, Safeway sells in 1 week, Walmart sells in 60 seconds. In 2010 every market channel experienced growth in natural product sales.
Natural and specialty retailers—which include independents and chains such as Whole Foods Market and GNC—continue to generate the lion’s share of natural & organic product sales. Sales within this channel expanded by 7% to $36 billion last year. In comparison, conventional retailers—which include chains such as Safeway and Kroger—recorded sales of $29.2 billion in natural & organic products. Sales of natural & organic products within all channels—retail and direct—grew 7% to approximately $81 billion.
Every major product category expanded last year within the natural channel. Food & beverage sales were up by 7.7%, personal care and household product sales grew by 6.1% and supplement sales expanded by 5.9%. The fresh produce category achieved the greatest growth in the natural channel last year.
Shoppers visit natural product stores to make their staple purchases, such as produce and dairy. They also are buying more small indulgences, such as nutrition bars, a category that has also seen a lot of innovation with manufacturers rolling out more high-protein, gluten-free, vegan, special-diet offerings and beers & wines.
Source: bordbia - Demand Outstrips Supply in US Health, Wellness and Organic Markets