Whole Foods encourages its shoppers to support local producers. [Photo © Elizabeth Kosturik]
By Elizabeth Kosturik
Canada’s organic market has been expanding in the past decade. Whole Foods has crossed the border from the U.S. and opened 10 stores between B.C. and Ontario. Conventional retailers like Loblaws and Walmart have added organic products to their shelves. In a 2013 report, the Canadian Organic Trade Association (COTA) found that 58 per cent of Canadians are buying organic on a weekly basis. The organic market in Canada is valued at about $3 billion a year in sales.
When it comes to the consumers of organic products, the question isn’t who is buying organic, but who is not. According to Shauna MacKinnon, one of the lead researchers of COTA’s report, families with young children, millennials (18-34 years-old), and ethnic minorities make up the majority of organic buyers. Seniors (65 years and above) seem to be the only demographic not buying into organic, MacKinnon says, because they don’t have children at home and don’t purchase as much food. According to the report, organic buyers tend to be university-educated and live in urban and suburban areas. But experts say it’s the underpinning “ideals” of organic that produces this specific type of consumer: one who is health-conscious, environmentally aware, and wants to support their local producers.
Leila Hamzaoui-Essoussi says that most organic buyers tend to shop organic because they want to avoid the worse chemicals in conventional products. Hamzaoui-Essoussi is a marketing professor at the Telfer School of Management at the University of Ottawa and has done extensive research about the Canadian organic market. She categorizes the typical organic consumer into two types: the hardcore consumer; and the occasional consumer.
“The hardcore consumers go through the short channels,” she says. “They want to go to specialty stores. They want to talk to producers and want to know how it’s been grown. They want to make sure they share the same values as those people.”
On the other hand, occasional consumers prefer a “one-stop shop” for their organics. “They go to the supermarket to get their fruits and vegetables, maybe some milk. But they’re not the ones who will go out of their way,” she says.
These unique profiles of organic consumers means retailers market towards them in different ways. Occasional consumers tend to shop at conventional retailers that sell organic, such as Whole Foods or Loblaws. Hardcore consumers prefer to go to specialty shops such as Farm Boy or farmers markets that sell organic. It’s what Hamzaoui-Essoussi calls “the trust dimension” between consumers and retailers. There is a shared set of values between the two.
“We found that since certification costs so much, some people would still go to farms that do not have the certification but are growing their stuff in an organic way,” she says. “People would say ‘well, I don’t need to have that official certification on my product as long as it’s one of the farmers from the region and he’s doing it the organic way. That’s more important than having an official sticker on my product.’”
One trend that is being seen in the organic market in Canada, regardless of the retailer, is local. MacKinnon says an increasing number of people want to know where their food is coming from. Both retailers and consumers want to support their local farmers and producers. She notes Canada’s organic market is quite young compared to the United States and European Union in terms of organic logo regulations. The Canadian organic-certified logo was implemented in 2009.
“The logo gives Canadian consumers a recognizable brand,” she says. “U.S. companies that have brought their products to Canada have started to use our logo on their Canadian packaging, rather than just using the U.S. logo. There is an equivalency agreement between the U.S. and Canada, so they could just sell with their U.S. logo. But they’ve made the choice to use the Canadian one because Canadians have more trust in the Canadian organic logo than the U.S. one.”
While the organic logo is a good step towards a recognizable organic symbol for consumers, it’s not compulsory, which is problematic according to Hamzaoui-Essoussi. Her research compares Canadian and French organic markets. In France, she says, there are established organic brands, something that Canada lacks. Instead, Canadian supermarkets try their own private label organic brands, such as baby food and toddler snacks, to appeal to the organic-buying families with children.
So once you get an organic product onto the market, how does one sell it? According to Jordan Rogers, sometimes it’s harder to get a product off the shelves than on them. Rogers is the founder of Lloyd-James Sales & Marketing, a Vancouver-based food products agent for natural and organic food manufacturers. He says that specialty organic stores are often the first channel to go through before moving onto bigger retailers and supermarkets.
“The big guys want to see that your organic brand has been in the market,” he says. “They want to see how many retailers, how well it’s doing.” But he agrees that one thing bigger retailers are “hungry” for right now are local products, and points out that some, such as Save-On-Foods in Western Canada, have local-only sections of their stores.
“U.S. companies that have brought their products to Canada have started to use our logo on their Canadian packaging, rather than just using the U.S. logo…They’ve made the choice to use the Canadian one because Canadians have more trust in the Canadian organic logo than the U.S. one.”
On the other side of the shelf, organic products, which used to have their own section in most supermarkets, are now being amalgamated with non-organic products. They do tend to be more expensive than non-organic, particularly dairy, eggs, and meat, so Rogers has to find alternative ways to market.
“We’re really engaged with social media, so we send products to bloggers,” he says. “And we say, ‘hey if you like it, can you write about it and talk about it?’ And we’re constantly doing demos and sampling as much as we can.”
Of course, not everyone is on board with organic. Kevin Grier, an agricultural and food market analyst, says he’s skeptical of organic products. He says from what he’s seen, scientifically there isn’t a difference between organic and non-organic, particularly in meat, and sees it more as a marketing gimmick.
“They have either a high price tag and lots of shrink, meaning they’re not sold before the best before date or have to be thrown out. Or they have a lower price tag but a loss,” he says. “These are items that retailers feel they need to have, but it’s not something that is anything to brag about.”
Hamzaoui-Essoussi agrees that some people may not buy into organic because of price or brand comfort, but says the organic trend will continue to expand in Canada. Whole Foods announced new stores for Edmonton and Calgary, and experts have projected the organic market to grow by about 10 per cent next year. Canada still has vast market potential for organic and consumers seem, for lack of a better phrase, ready to eat it up.