Organic Processing Vo1.5 #5

“We [the organic industry] have become much better about both identifying and communicating what consumers want and need to know about organic. We at Earthbound Farm know, for example, that some consumers are more interested in the technical side of organic than others, so we work hard to ensure that different levels of information are available to them. That way, we not only satisfy the needs and desires of consumers interested in the basics, but also those who want to know more.”

Thus, more work is needed to create industry-wide messages that are appealing to and well understood by consumers.

Threats: Competing Labels, Opposing Voices Opportunities: Consumer Education, Emerging Science

Trends Database, the “Evolution of Personal Care Study”, “HealthBeat Interactive” and NMI’s Product Attribute Trend Identifier (PATI),

“Consumers do not easily understand terms such as ‘certification’ and ‘accreditation,’ and often fail to connect with these terms on an emotional level.”

Lack of Regulation in Emerging Categories

Another reason for this confusion may be the lack of well-defined standards within newer categories of organic. Although standards for organic foods are rela- tively well defined, those for such sectors as personal care products, aquaculture and pet food are still under development, with much debate on how to shape such standards. The Global Organic Textile Standards (GOTS) for textiles and NSF and Oasis personal care standards are making headway, but are still voluntary and many companies in these emerging categories are using the word “organic” without any sort of official verification.

Uncertainty and debate are natural parts of the evolution of the organic industry and, therefore, should not necessarily be seen as weaknesses, according to Katherine DiMatteo, senior associate at Wolf, DiMatteo + Associates and newly elected IFOAM World Board president. On the contrary, she sees the deliberative nature of standards development as one of the organic industry’s strengths. “It took many years of discussion and debate before OFPA went into effect, so it only makes sense that the process of devising standards for other sectors of the organic industry is an intense and time-consuming one as well,” she said. “Organic is a thoroughly scrutinized industry, involving a large number of stakeholders. This means that decisions sometimes take longer to make, but it also means that the decisions that are made have been carefully thought through.” Still, she acknowledged, the absence of standards in emerging sectors may create frustration for those producing, buying and selling these types of organic products.

Strengths: Consumer Demand • Opportunities: Consumer Education

Price Barrier

Yet another obstacle is the price of organic goods. According to studies conducted by the Natural Marketing Institute, including the Health and Wellness Trends Database, the LOHAS (Lifestyles Of Health And Sustainability) Consumer

along with qualitative insights from NMI in-depth interviews, nearly three quarters of consumers feel that organic foods are too costly.

Often the prices for organic products are somewhat higher than for non-organic counterparts. Most of us in the industry know that there are a variety of reasons for this. For example, organic farming faces stricter regulations than do conventional practices, and thus such farming tends to be more labor and management intensive. Because organic tends to be done on a smaller scale than conventional farming, organic farmers often pay more per acre to produce and to distribute many of their products.

Moreover, historically organic farmers have not had access to the same government subsidies as their non-organic counterparts, which has meant price tags on organic products reflect real, rather than subsidized, production costs. Additionally, increased demand for biofuels, rising fuel and freight costs, shifts in the stock market from funds to agricultural commodities and a decline in the purchasing power of the dollar are driving up prices for organic and conventional foods alike.

The challenge is to educate consumers about the true costs and values associated with organic products. Thus, many see the need to address the price issue and better communicate to consumers the value proposition for organic goods.