Barbara Katz, President, HealthFocus International04.01.15
As it relates to foods and beverages, “natural” in some ways can be considered the “everyman’s organic.” This may not be a fair or accurate view by consumers, but let’s consider grocery shopping from the consumer perspective—a mainstream consumer perspective—not a cutting-edge, higher-income consumer who has a greater capacity to purchase premium foods and is more interested in organic.
HealthFocus International studies have shown that more and more shoppers are seeking authenticity in their choices, whether they are in the grocery store or in the health food store. They are looking to purchase foods and beverages that offer the feeling that they came from their own backyards. Shoppers consider words like natural, organic, non-GMO, artisan, grass-fed and locally-sourced as quick indicators of better nutrition choices.
Natural Drivers
What we call “Clear Clues” are used as shortcuts by consumers to make choices. In a world where 74% of people say they wish they could eat healthy foods more often but are just too busy, it’s not always possible to have a complete understanding of what words like natural and organic mean. So along with a host of other brand attributes, like where they bought it, who manufactured it and the lack of chemical ingredients on the label, these cues contribute to creating a positive image among consumers that they can identify quickly.
“Natural” stands for a lot of things that shoppers find desirable. It does not mean they think it is the same as organic. Only 19% of shoppers think organic foods are the same as “all-natural” foods. But if shoppers don’t want to pay more for organic because they can’t, or because the value proposition isn’t strong enough, then a reassurance of natural for many of them validates that their choice has a measure of the purity and authenticity they seek.
Thirty-seven percent of shoppers think natural is an extremely or very important brand attribute, compared to a similar 27% for organic. More critical for both these terms are the benefits consumers associate with them. For example, 46% think that pesticide-free (the top attribute associated with organic) is highly important while 41% think preservative-free (one of the top attributes associated with defining natural) is highly important. So the benefits of the two terms are similar in importance but not necessarily in attainability.
While half of shoppers think organic foods are safer, only 36% think they are worth paying slightly more for. Surprising as it is, the overwhelming notion among shoppers is that organic foods either aren’t different enough from non-organic foods or they don’t cost more to make so they shouldn’t cost more to purchase. The term natural holds a lot of sway with consumers; it’s not a second-best. The HealthFocus Consumer Understanding of Natural study released in 2013 reported even back then a growth of “natural” as a health indicator; it also predicted the growing negative association with genetic modification among consumers. On labels, “non-GMO” was very important to more consumers than any other phrases, including “100% natural ingredients,” “no preservatives” or “no artificial flavors or colors.” These specifics are the clearest of clues to natural shoppers. Shoppers respond to clarity more than they respond to generalities. Organic was much further down the list, as were other less specific terms like “contains natural ingredients.” Once again, we see that shoppers are looking for things that give them immediate clarity—a Clear Clue. It’s fine to say “contains natural ingredients.” It’s better to say “100% natural.”
As is often the case, there are as many exceptions as there are rules. For instance, if a category is already considered “Better For You,” like yogurt, natural takes a front seat in terms of importance, whereas, if the category is energy drinks, natural as an attribute can be somewhat less important. This is not to say natural is unimportant, all other things being equal. However, it is important to understand the driving consumer motivation regarding the category. In places where shoppers think they are getting another functional benefit, the attribute is less important. This is not to say that game changers won’t occur in these categories if natural is an available option and the benefits remain the same. But when evaluating the relative importance to shoppers, natural may have less weight because consumers never shop or buy based on a single attribute. It’s always a complicated matrix of needs.
Natural vs. Processed
Now that we’ve discussed the importance of natural, let’s explore what it means to shoppers compared to processed. The two terms are very closely linked, though many consider them to be opposites. Natural to shoppers, in short, means “free-from.” The majority of shoppers link natural to what is left out of the product. To quote one shopper in the HealthFocus study, “When I think of natural products, I expect to be able to read the list of ingredients and not see any preservatives or chemical additives.”
As for processed? To 65% of study respondents, processed mean things have been added like preservatives, genetically modified ingredients or artificial flavors or colors. Only 35% equate processed to food and beverage production or manipulation. So while natural is generally a “good” word, processed has become the corresponding “bad” word.
There’s an upside to processing though, in terms of how the consumer sees it. A majority (59%) realizes it is often necessary for extended shelf life and convenience. But many consumers, particularly these days, have an unfulfilled vision of themselves milking their own cows, growing their own vegetables and raising their own chickens. So the compromise of convenience is both their need and their nemesis.
According to the follow-up natural study HealthFocus International conducted in 2013, genetically modified ingredients scored highest for what should be left out of products. Other elements included artificial ingredients like flavors or sweeteners, additives, chemicals or preservatives. So the closer we can get to transparency, the closer products will align with the shopper ideal. Shoppers want ingredients or products where they understand the source. If they can trace it and understand it, they are more likely to consider it natural.
Honey is a great example. According to the most recent U.S. Trend Study by HealthFocus, 80% of shoppers judged honey to be a “good” sweetener because they feel like they can trace the source. Well then, why isn’t sugar viewed the same way? Because sugar looks nothing like the cane or the beet from whence it came, and it’s been somewhat vilified, which illustrates the other point made earlier regarding how consumers judge the term natural. If a food or beverage is in a category consumers consider not as good for them, then it’s going to be harder to sell the benefit of natural. It’s not impossible, however. The marketplace is full of natural soft drinks and natural snacks that can make people feel better about their choices. But that doesn’t mean consumers think they are healthy.
Understanding the importance of natural, organic, GMO or any of the clean label attributes discussed here also means understanding the relative importance of the category, brand and target consumer, in addition to how they relate to other benefits the brand offers.
It also requires an understanding of the competitive field, because while we may deem one of these clean label attributes of lower importance in a brand or category, this can change over time. I’m guessing that natural or organic wasn’t considered a strong need in the macaroni and cheese category. But with Clear Cues on packaging like real, organic, homegrown and grass-fed, brands like Annie’s turned a low-cost, convenient staple that people knew their kids liked, into something they could also feel better about.
Where does the clean label market go from here? It’s not just the label that consumers are interested in now, as they put more focus on clean brands. Ideally, they want to be able to look at a product and recognize all the ingredients on a label. The new reality is that consumers want to be assured those recognizable ingredients are authentic, not modified and that minimal harm—or maybe even some good—was done in the making. And as always, be sure that good taste is still number one.
Barbara Katz is president of HealthFocus International, a company that researches consumer needs in health and nutrition. A new study titled Clean and Green covering updated views from consumers on these topics will be available in April. For more information, contact barbara.katz@healthfocus.com.
HealthFocus International studies have shown that more and more shoppers are seeking authenticity in their choices, whether they are in the grocery store or in the health food store. They are looking to purchase foods and beverages that offer the feeling that they came from their own backyards. Shoppers consider words like natural, organic, non-GMO, artisan, grass-fed and locally-sourced as quick indicators of better nutrition choices.
Natural Drivers
What we call “Clear Clues” are used as shortcuts by consumers to make choices. In a world where 74% of people say they wish they could eat healthy foods more often but are just too busy, it’s not always possible to have a complete understanding of what words like natural and organic mean. So along with a host of other brand attributes, like where they bought it, who manufactured it and the lack of chemical ingredients on the label, these cues contribute to creating a positive image among consumers that they can identify quickly.
“Natural” stands for a lot of things that shoppers find desirable. It does not mean they think it is the same as organic. Only 19% of shoppers think organic foods are the same as “all-natural” foods. But if shoppers don’t want to pay more for organic because they can’t, or because the value proposition isn’t strong enough, then a reassurance of natural for many of them validates that their choice has a measure of the purity and authenticity they seek.
Thirty-seven percent of shoppers think natural is an extremely or very important brand attribute, compared to a similar 27% for organic. More critical for both these terms are the benefits consumers associate with them. For example, 46% think that pesticide-free (the top attribute associated with organic) is highly important while 41% think preservative-free (one of the top attributes associated with defining natural) is highly important. So the benefits of the two terms are similar in importance but not necessarily in attainability.
While half of shoppers think organic foods are safer, only 36% think they are worth paying slightly more for. Surprising as it is, the overwhelming notion among shoppers is that organic foods either aren’t different enough from non-organic foods or they don’t cost more to make so they shouldn’t cost more to purchase. The term natural holds a lot of sway with consumers; it’s not a second-best. The HealthFocus Consumer Understanding of Natural study released in 2013 reported even back then a growth of “natural” as a health indicator; it also predicted the growing negative association with genetic modification among consumers. On labels, “non-GMO” was very important to more consumers than any other phrases, including “100% natural ingredients,” “no preservatives” or “no artificial flavors or colors.” These specifics are the clearest of clues to natural shoppers. Shoppers respond to clarity more than they respond to generalities. Organic was much further down the list, as were other less specific terms like “contains natural ingredients.” Once again, we see that shoppers are looking for things that give them immediate clarity—a Clear Clue. It’s fine to say “contains natural ingredients.” It’s better to say “100% natural.”
As is often the case, there are as many exceptions as there are rules. For instance, if a category is already considered “Better For You,” like yogurt, natural takes a front seat in terms of importance, whereas, if the category is energy drinks, natural as an attribute can be somewhat less important. This is not to say natural is unimportant, all other things being equal. However, it is important to understand the driving consumer motivation regarding the category. In places where shoppers think they are getting another functional benefit, the attribute is less important. This is not to say that game changers won’t occur in these categories if natural is an available option and the benefits remain the same. But when evaluating the relative importance to shoppers, natural may have less weight because consumers never shop or buy based on a single attribute. It’s always a complicated matrix of needs.
Natural vs. Processed
Now that we’ve discussed the importance of natural, let’s explore what it means to shoppers compared to processed. The two terms are very closely linked, though many consider them to be opposites. Natural to shoppers, in short, means “free-from.” The majority of shoppers link natural to what is left out of the product. To quote one shopper in the HealthFocus study, “When I think of natural products, I expect to be able to read the list of ingredients and not see any preservatives or chemical additives.”
As for processed? To 65% of study respondents, processed mean things have been added like preservatives, genetically modified ingredients or artificial flavors or colors. Only 35% equate processed to food and beverage production or manipulation. So while natural is generally a “good” word, processed has become the corresponding “bad” word.
There’s an upside to processing though, in terms of how the consumer sees it. A majority (59%) realizes it is often necessary for extended shelf life and convenience. But many consumers, particularly these days, have an unfulfilled vision of themselves milking their own cows, growing their own vegetables and raising their own chickens. So the compromise of convenience is both their need and their nemesis.
According to the follow-up natural study HealthFocus International conducted in 2013, genetically modified ingredients scored highest for what should be left out of products. Other elements included artificial ingredients like flavors or sweeteners, additives, chemicals or preservatives. So the closer we can get to transparency, the closer products will align with the shopper ideal. Shoppers want ingredients or products where they understand the source. If they can trace it and understand it, they are more likely to consider it natural.
Honey is a great example. According to the most recent U.S. Trend Study by HealthFocus, 80% of shoppers judged honey to be a “good” sweetener because they feel like they can trace the source. Well then, why isn’t sugar viewed the same way? Because sugar looks nothing like the cane or the beet from whence it came, and it’s been somewhat vilified, which illustrates the other point made earlier regarding how consumers judge the term natural. If a food or beverage is in a category consumers consider not as good for them, then it’s going to be harder to sell the benefit of natural. It’s not impossible, however. The marketplace is full of natural soft drinks and natural snacks that can make people feel better about their choices. But that doesn’t mean consumers think they are healthy.
Understanding the importance of natural, organic, GMO or any of the clean label attributes discussed here also means understanding the relative importance of the category, brand and target consumer, in addition to how they relate to other benefits the brand offers.
It also requires an understanding of the competitive field, because while we may deem one of these clean label attributes of lower importance in a brand or category, this can change over time. I’m guessing that natural or organic wasn’t considered a strong need in the macaroni and cheese category. But with Clear Cues on packaging like real, organic, homegrown and grass-fed, brands like Annie’s turned a low-cost, convenient staple that people knew their kids liked, into something they could also feel better about.
Where does the clean label market go from here? It’s not just the label that consumers are interested in now, as they put more focus on clean brands. Ideally, they want to be able to look at a product and recognize all the ingredients on a label. The new reality is that consumers want to be assured those recognizable ingredients are authentic, not modified and that minimal harm—or maybe even some good—was done in the making. And as always, be sure that good taste is still number one.
Barbara Katz is president of HealthFocus International, a company that researches consumer needs in health and nutrition. A new study titled Clean and Green covering updated views from consumers on these topics will be available in April. For more information, contact barbara.katz@healthfocus.com.
