Sales of organic produce were up 5.1% for the 52-week period ending Feb. 23, according to data from market research company Circana. Increases were the largest in the categories of tropical and specialty fruit (21.8%), mixed vegetable kits (16.3%) and cruciferous vegetables such as broccoli and cabbage (13.6%).
Organic produce sales have been rising for years, said Jonna Parker, Circana's vice president of fresh foods. In 2019, they accounted for 11.5% of produce sales in the U.S., and they now constitute 12%.
“Demand for organic produce has been steadily growing, driven by a growing interest in health, sustainability and food quality,” said Kristina Garris, executive director of fresh for Bashas' and Food City, a division of The Raley's Cos., Chandler, Ariz.
And at Giant Food, Landover, Md., berries, salads, herbs, carrots, onions, tomatoes, apples, grapes and citrus are bestsellers.
“More and more shoppers are choosing organic,” she said. “AJ's Fine Foods has seen strong growth in this area recently, and we expect to see a similar trend at Bashas', especially with our weekly ads now featuring more organic options.”
Berries are the standout organic produce item at Bashas' and AJ's “because they tend to have high pesticide residues when grown conventionally, which makes organic options more attractive to health-conscious consumers,” Garris said.
According to Circana data, one rising star in organic vegetables is the parsnip, whose sales increased 603% during the year ending in February. Other popular products are kiwifruit, salad kits, jicama, broccoli, avocado, grapes, papaya, coconuts, cherries, nectarines and apricots.
Parker said some of these vegetables' rise through the ranks is due to social media, where influencers “show consumers new ways to use them and ways to make them versatile.” That drives demand, she said, “even if it's a regular old item. People want versatile ingredients that are healthy with products you have on hand.”
The organic consumer
While all generations buy organic produce, sales are especially strong among “younger, health-conscious and well-educated” shoppers, said Garris, “with millennials and Gen Z leading the trend.” Hispanic shoppers also represent a growing segment, and families with young children often prioritize organic for health reasons.
“People of every generation buy organics, but people of younger generations are interested more overall,” Parker said. And while most consumers eat organic produce because they consider it healthier, she said, “people who are very into organics will talk about the sustainability factor.”
Parker said that, in general, the organic shopper is a foodie who cooks from scratch and places an emphasis on freshness, flavor and nutrition. This consumer considers organic produce to be premium.
It's important to understand organic shoppers and their motivations and anchor everything around that, she said. Retailers can provide more in-depth product information or offer recipes to engage with them.
The top reason consumers shop for organic produce is to reduce their pesticide exposure, Garris said, but a close second are environmental reasons. These are followed by: organic produce is said in some studies to have more nutrients; it does not contain GMOs; and it tends to mean supporting small farmers.
Spotlight on manufacturers
Access Organics, Kalispell, Mont., offers “wet produce,” including broccolini, bunching greens and celery from November through the spring, then melons from mid-May through the summer months.
Last year it introduced four new types of melon — the honeysaurus, the orange-fleshed honeydew, the golden honeydew and a black seedless watermelon — grown in the Imperial Valley and Central Valley in California, which are all seeing strong sales. Adding these has allowed the company to extend its melon season from six weeks to six months. Ryan San Jose, national sales manager, expects to see melon volume double this year.
In the past year, Access Organics began sourcing some produce from Mexico, such as garlic, celery, radish and bunching greens, because labor costs are lower there, even with tariffs, San Jose said. Many of the items the company sources from Mexico are sold in bunches, which requires a lot of labor.
Last year the company expanded into onions, potatoes and garlic, which it plans to use this spring to bridge the wet produce and the melon season when there's a gap in onion availability from Washington state.
Organic mushrooms sales are also doing well, and Highline Mushrooms in Leamington, Ontario, is seeing increased demand.
Most of its products are sold packaged, either whole or sliced, but the company is “seeing people trading up to larger pack sizes,” said Devon Kennedy, national marketing manager. “Our 24-ounce packs in both white and Mini Bella continue to shine, showing growth in dollar, unit, and pound sales. The 24-ounce pack has been the top performer for the month of March.”
Topline Farms, also in Leamington, offers tomatoes, peppers and cucumbers that are greenhouse-grown, commonly referred to as controlled environment agriculture.
These controlled conditions “reduce the need for synthetic pesticides and fertilizers, aligning with organic farming principles and appealing to health-conscious shoppers,” said Chris Veillon, vice president of marketing. “Many consumers are also drawn to the environmental benefits, such as more efficient water use and reduced land degradation.”
Rebranding organics
Introducing new branding last year helped boost Access Organics' sales. Now the logo, used on stickers and boxes, features the company name with the U.S. flag and a mountain. San Jose said this especially helps boost sales for barbecue season.
“It makes our produce stand out at the store,” he said. “Organic needs to call out from the shelf [so] people know what they're buying.”
Highline Mushrooms is also rebranding with new packaging, which it will launch in coming weeks. The on-pack messaging includes QR codes that link to recipes.
At the end of last year, Highline Mushrooms launched a website aimed at giving more product and sustainability information and recipe inspiration. The brand uses social media and partners with influencers who promote the health of mushrooms, recipe content and nutritional guidance.
Topline Farms also rebranded recently with the goal of informing consumers, as well as connecting and engaging with them.
It's reviewing all channels — social media, web, email, video — as “appropriate resources for growth,” Veillon said. “We are seeing significant uptick in our social traffic in the last four to five months as we develop more relevant content to strengthen our brand position. Peeling back the layers of what happens behind the scenes of a greenhouse and what it produces is garnering more and more attention from interested audiences.”
At the store level
Highline Mushrooms collaborates with retailers about drawing consumers to organic produce and provides shelf strips, floor decals and product information. It also works to make mushrooms stand out.
“Traditionally the mushroom wall has been very white and brown with dull labels. We recently transitioned our tills to clear rPET that is 100% recyclable and allows consumers to see the mushrooms in the till and high quality that we grow,” Kennedy said. “Because the product can be seen through the till, we are now using the retail on top of the pack to showcase our brand with bright, bold colors that will draw people to the mushrooms wall.”
Access Organics provides recipes on social media and includes recipes when it sends its price list to retailers with the goal of enticing them to carry its products while also providing marketing collateral.
Topline Farms works with retailers to create seasonal promotional campaigns to keep customers engaged.
“Activity in the fresh produce aisle is a good thing,” Veillon said. “Consumers want to see fresh products on display, pairing new items together, sampling where possible.”
Getting consumers to try new products can create significant incremental sales, and great merchandising includes “amazing waterfall displays with fresh produce, showing consumers the amazing colors of our products,” he said.
Giant Food stores feature independent organic islands with organics mainly in one spot with organic signage, said Matt Novosel, director of produce and floral.
To draw attention to organic and to avoid cross-contamination with non-organic items, Bashas' and AJ's keep organic produce separate. Manufacturers also supply POS materials to highlight these products, Garris said, “making it easier for customers to spot and choose organic options.”
Pricing considerations
The cost of organic produce tends to determine whether people will buy it, especially when comparing the price to conventional counterparts. However, “the true organic customer doesn't look at price,” said Marc Goldman, director of produce and floral for Morton Williams Supermarket, Bronx, N.Y.
Occasional organic shoppers buy organic only when the price is appealing, he said, but Morton Williams runs organic produce in its ads every week.
Circana's Parker added that loyal organic consumers tend not to trade off between organic and conventional, but rather organic and organic — meaning if the organic item they want to buy is too expensive, they'll buy something else organic instead.
Bashas' wants organic produce to be accessible, so it features at least two dedicated ad blocks each week to promote organic produce offerings.
But over the past few years, the cost of organic produce has significantly decreased, Garris said.
“With more organic growers entering the market each year, supply has increased, helping lower prices,” he said. “Organic products are now only 10% to 15% more expensive than conventional options, and this price gap continues to narrow each year.”
At Giant Food, organic produce sales have remained flat “due to inflationary pressures” over the past three years, said Novosel, but he added that the stores run promotions regularly, “and consumers react positively to deal pricing. There is a decision behavior between organics and conventional produce when a customer only has so much to spend on groceries each trip.”
“Economic downturns, like recessions, usually affect how people spend money, including on organic produce,” Garris said. “Back in the 2008-09 recession, we saw a lot of people switch from organic to conventional products because of tighter budgets, which slowed down organic food sales. However, the organic market has grown substantially since then and has proven to be pretty resilient.”