Sorting Through Organic and Natural

Understanding differences between the labels and consumer perceptions

Never have there been so many choices in the produce aisle. New pack sizes, new varieties and fresh cuts have multiplied. With many available in both conventional and organic labels, it’s a good time to sort through what “organic” and “natural” mean, and their continuing marketing implications.

I’ve represented firms marketing both conventional and certified organic produce and, in the process, have helped develop many lines of packaging and in-store merchandising. In this article, I’ll define three categories – organic, natural and certified naturally grown; I’ll then draw some general marketing conclusions around those terms.

Let’s start with organic. The USDA’s Agricultural Marketing Service has guidelines on food that can be sold as “organic” and carry the USDA Organic seal. For produce, this involves the documentation of all production (and any packing or even processing) as being certified organic. The USDA maintains a National List of all the inputs that can be used in organic production along with guidelines for certified organic handling.

What about natural? The USDA’s website tells us that “there are no standards or regulations for the labeling of natural food products if they do not contain meat and eggs.” That opens up the term “natural” for a wide range of labeling uses.

“Certified Naturally Grown” is a designation that, as far as I can tell, is often used by smaller fresh produce growers selling at local farmers markets. This certification, not regulated by USDA, involves a review of the producer’s records and production practices by other growers.

I’ve been very careful not to venture into a discussion of the “intrinsic value” of these labels, or what a label “really means.” I’m more interested in the consumer perception, and it turns out that, in the last ten years, agricultural economists have conducted many “willingness to pay” experiments that evaluate consumer willingness to pay. I asked a researcher to help me overview that literature.

We found the studies support what many in the produce industry know or suspect. In short, there remains consumer confusion over what “organic” means, as well as the meaning of the USDA organic seal. Furthermore, other words or traits, such as production region or origin, may be more important than ‘organic’ or ‘natural’ in the consumer mind.

Finally – most obviously – different kinds of consumers value “organic” and “natural” differently. I know this simply by comparing the produce sections in my local Walmart and Whole Foods.

I think that, in this consumer confusion, there remains opportunity for grower shippers and merchandisers to help our customers sort out what organic and natural mean. Consumers remain more and more interested in the story behind their food, especially new products. Crafting a compelling marketing message that explains what any label means – in ways that capture the customer’s interest and willingness to pay – will still lead to more opportunities in produce, whether labeled organic or otherwise.

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Anthony Totta

Anthony Totta

This industry is filled with passionate people who love what they do. Most come from wonderful entrepreneurial family businesses with a rich heritage. So do I. I've learned from them. The've learned from me. Together we promote nutritionally rich fresh food for healthy living. It's a fabulous journey and a wonderful mission!