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Natural and organic food, beverages market to double by 2015

BY Allison Cerra

NEW YORK — Natural and organic foods and beverages are expected to realize dramatic growth in 2011 and beyond, following strong U.S. retail sales over the past five years.

According to new research conducted by Packaged Facts, "Natural and Organic Foods and Beverages in the U.S., 3rd Edition," U.S. retail sales of natural and organic foods and beverages rose to nearly $39 billion in 2010, a 9% increase over 2009, and 63% higher than sales five years earlier.

Looking ahead, sales are expected to rise 45% by the end of 2011, while the overall market is expected to grow by 103% between 2010 and 2015, with total annual sales exceeding $78 billion in 2015, the report projected.

Big category drivers include Frito-Lay, a PepsiCo division, which recently announced that by the end of the year, approximately half of its product portfolio — including Lay’s Tostitos and SunChips snacks — will be made with all -atural ingredients.

"The Frito-Lay products will in themselves have an enormous impact on the natural foods marketplace, and Frito-Lay’s move will spur other manufacturers to invest more heavily in producing natural and organic products," Packaged Facts research director and publisher David Sprinkle said. "Since Frito-Lay’s announcement, Kraft Foods and Coca-Cola have made strategic moves to better position themselves in the market."

According to a recent Packaged Facts survey, 38% of U.S. adults polled that are grocery shoppers buy organic groceries, while 58% buy packaged food products marketed as "all-natural" (but not organic). The survey also found that 37% of all respondents "strongly" (12%) or "somewhat" (25%) agreed that they seek out natural and organic foods and beverages.

Back in February, Packaged Facts found that gluten-free products have gained momentum in the market, with sales expected to grow from about $2.6 billion to $6 billion in 2015.

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In The Raw sweeteners kick off TV ad campaign

BY Allison Cerra

NEW YORK — The maker of Sugar In The Raw and Stevia In The Raw products has launched a new television advertising campaign to show consumers "it’s only natural."

The ad spots, created by Mother New York, tap into the truths of human nature as they relate to all things food — showing the influence of Sugar In The Raw and zero-calorie Stevia In The Raw on consumer behavior when faced with everyday decisions — according to Cumberland Packing, the company behind the In The Raw brand. The ads feature the voice of actress Frances McDormand and are directed by Academy Award nominee Brett Morgen.

Click here to see the ad spots.

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Healthy names of food products may deceive dieters

BY Allison Cerra

COLUMBIA, S.C. — A new study conducted by researchers at the University of South Carolina found that unhealthy food products that tout healthy names may dupe dieters into considering them as good-for-you items.

"The Impact of Product Name on Dieters’ and Non-Dieters’ Food Evaluations and Consumption" found that among more than 520 study participants, dieting tendency has no effect on product evaluations if foods carry a healthy name, such as salad, although dieters are more mindful if a product touts a name that is considered unhealthy, such as pasta.

The study authors — which included lead investigator Caglar Irmak, an assistant professor of marketing at the Darla Moore School of Business, along with Beth Vallen of Loyola University and Stefanie Rose Robinson, a doctoral student in marketing at the Moore School — concluded that this effect, which results in actual food consumption differences, "is explained by nondieters’ insensitivity to food cues, as well as dieters’ reliance on cues indicating a lack of healthfulness and tendency to employ heuristic information processing when evaluating foods."

"The fact that people’s perceptions of healthfulness vary with the name of the food item isn’t surprising," Irmak said. "What is interesting is that dieters, who try to eat healthy and care about what they eat, fell into these ‘naming traps’ more than nondieters who really don’t care about healthy eating.

"These results should give dieters pause. The study shows that dieters base their food decisions on the name of the food item instead of the ingredients of the item," Irmak added. "As a result, they may eat more than what their dieting goals prescribe."

The study will be published in the August issue of the Journal of Consumer Research.

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