- Organic and animal welfare claims are driving growth in the food and beverage space, according to SPINS data presented at Natural Products Expo East. These claims accelerate retail growth for products straddling the line of better-for-you and better-for-the-environment, the data firm said, motivating consumers' purchasing decisions.
- Sales of products citing animal welfare claims have climbed 27% in the last two years. Organic product sales have also posted significant growth during the past year as the pandemic provided an ideal environment for growth, but the rate has slowed to 6.6% for 2021.
- As consumers turn to food as a source of medicine both for themselves and the environment, they are becoming more conscious of the ingredients in products. These findings from Expo East could direct companies' focus as they try to deliver products aligning with evolving consumer preferences.
While the claims propelling sales are not surprising, the degree to which these qualities have motivated consumers to purchase products is a clear indication the health and wellness trend spurred by the pandemic will be around for the foreseeable future.
The desire to eat healthier has helped lead to a multi-year upswing in organic product sales, but this steady growth paled in comparison to 2020. Last spring, organic food saw reinvigorated category growth, with organic produce sales rising more than 20% — up from a 4.6% increase in 2019 — and sales of organic flours and baked goods increased 30%, according to the Organic Trade Association. Over the course of 2020, shoppers stocking up caused the organic sector to jump 12.7% to $259 billion.
The pace of growth has slowed this year, but SPINS data shows many newcomers are shopping organic. The rate of growth this year outpaces that of 2019, and industry experts anticipate the organic category will surpass $300 billion by 2023. More than 70% of the growth in the organic category is driven by food and beverage, SPINS Executive Vice President Kathryn Peters said at the conference, according to Food Navigator.
Shoppers are also looking more frequently at how companies treat the animals that they use. This is especially true as plant-based alternatives gain steam in the market. Plant-based products have grown at three times the rate of overall food and beverage sales, jumping 12.8% year-over-year compared to a 4.2% rise for all product sales, according to SPINS data.
Meat and dairy companies are working to address consumer concerns by touting animal welfare claims. 77% of consumers are concerned about animal welfare in food, according to a 2018 report from Technomic and the American Society for the Prevention of Cruelty to Animals. The new SPINS data presented shows that more meat and dairy manufacturers making this kind of claim now than before the pandemic. Animal welfare claims on meat products increased 7.5% and 3.3% on dairy products.
Several companies are working toward improving their treatment of animals. More than 200 companies — including General Mills, Kraft Heinz, Unilever, Hormel and Conagra — have committed to adopt the meet the animal welfare standards outlined in the Better Chicken Commitment. And in the 2020 report from the Business Benchmark on Farm Animal Welfare, 79% of the 150 companies reviewed have formal policies on animal welfare.