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The rise and rise of organics

Three in five Canadians buy organic products once a week.

Customers at Choices Markets in Vancouver tend to be green-minded and health-conscious. The typical patron is a university-educated woman with children. Her paycheque is big enough to feed her young family the organic and natural foods that Choices specializes in.

And according to a study by the Canadian Organic Trade Association, she’s pretty much the average organic shopper in this country.

The study, “Canada’s Organic Market,” is the first major look at organic sales since Ottawa introduced mandatory organic regulations, in 2009, says Matthew Holmes, COTA’s executive director.

Among the findings: more Canadians buy organics weekly than previously thought, and certain categories, such as beverages, are experiencing the fastest growth. Let’s take a look at the numbers:

Sales of organic food and beverages at conventional retailers, including grocery stores, nearly tripled, to $1.35 billion in 2012, from $586.3 million in 2006.

Those sales rose to $3 billion when other channels, such as natural health stores and online retail, direct to consumer, foodservice/institutional, buying clubs and co-ops were included.

Organics still represent only a fraction of the overall Canadian food and beverage market–about 1.7% of total grocery sales. But they attract a disproportionate number of shoppers.

Nearly three in five (58%) Canadians say they buy organic products every week. Organic shoppers also spend more per week on groceries than non-organic shoppers: $132.68 vs. $115.22.

Of course some people buy more organic foods than others. Canada’s highest weekly buyers of organic groceries tend to live in the country’s largest cities. Typically, they are 35 to 44 years old, university educated and have children under the age of two.

But times are changing and the audience for organics is widening. Older boomers and younger millennials, for instance, are shopping more often at Choices’ seven stores in Vancouver and Kelowna, says marketing manager, Tyler Romano.

“We’re seeing customers in the 18 to 24 range coming in and picking up a few grab-and-go items. So it’s something they’re interested in,” Romano says. “At the same time, we’ve had a lot more older clientele, around 60, coming in.”

A COTA survey also found unexpected popularity among ethnic Canadians. “We hadn’t anticipated the degree to which the non-Caucasian population in Canada is skewing toward organic,” says Holmes.

Then again, ethnic Canadians fit the profile of the typical organic shopper: well educated and living in cities such as Toronto and Vancouver.

Closer inspection of ethnic shoppers shows some interesting variations in their beliefs and actions.

For one, they are more likely than average Canadians to pay more for food they consider “good” for themselves and their families. They also believe that organic farming is better for the environment and consider organic foods to be healthier and more nutritious.

More important, perhaps, is that ethnic shoppers equate organics with food safety.

A 2011 Nielsen global survey found that people in China, India and the Philippines believe that food safety and organic products go hand-in-hand.

Eighty-one per cent of people in the Philippines, 70% of Indians and 53% of Chinese believe organic foods are safer. Only 23% of Canadians believe the same thing. So what organic categories are most popular?

The COTA report found fruit and vegetables capture 39% of total sales. Beverages, such as soya drinks, coffee and shelf-stable juices, were next, at 15%, with dairy and eggs at 15%. But market penetration for organic meats, poultry and fish remains stubbornly low at just 2%.

Of course, certain categories are growing faster than others. In packaged groceries, for example, beverages have performed extremely well. Organic roast and ground coffee have seen annual sales growth in grocery stores, mass and drugstores of 10.5% a year since 2008. Shelf-stable juices and drinks grew 9.8% a year during the same period.

The largest packaged category in organics, soya drinks, grew 4.8% a year. The COTA report also found that certain label claims hold more sway over organic consumers.

Labels these shoppers look for most often: Made in Canada, local, free-range and grass-fed, the Canada Organic certification logo and Non-GMO. Interestingly, the USDA Organic seal did not come across as being as influential as Canada’s organic logo.

Looking ahead, the study found that 98% of Canadians expect to buy the same amount or more of organic fruit and vegetables in the year ahead. They also plan to buy more organic meat, poultry, dairy and bread.

Seems that organic’s rise isn’t over yet.

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