Sorry for interrupting, this website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Learn more
Accept & Close

Organic Food and Drink - UK - October 2013

“It is important for organic brands to communicate to shoppers in a more effective way the tangible, concrete benefits their products offer them. Given the vast amount of product information that is already competing for shoppers’ attention, clear, dynamic labels that can be understood at a glance are needed.”

– Emma Clifford, Senior Food Analyst

Some questions answered in this report include:

  • What impact has the horsemeat scandal had on the organic food market?
  • What barriers does the market face in capitalising on the predicted growth in consumer spending?
  • How can brands more effectively communicate the benefits of the organic label?
  • Will a change in EU organic regulation benefit the market?

The post-recessional landscape in the UK remains a challenging one for the organic label. While people are adopting a more positive outlook and consumer spending is tentatively picking up, the organic market is undoubtedly marred by perceptions of organic food being overpriced and the related scepticism over the palpable benefits it offers consumers. Therefore, overturning negative attitudes and justifying price points will be key in order for the market to reap the rewards from shoppers starting to loosen their purse strings as the economy regains momentum.

Nonetheless, the first green shoots of recovery are evident. After four years of successive decline – with the value of the market sliding by 27% between 2008 and 2012 – retail sales of organic food are forecast to edge up by almost 1% in 2013. This is expected to be driven by growth in both the dairy and baby food sectors and helped by sales of organic fruit and vegetables stabilising.

The extent of the impact the horsemeat scandal, and the spotlight it put on sourcing integrity, had on organic sales is difficult to gauge in real terms. However, a quarter of organic shoppers agreed that the scare made organic produce more appealing to them, indicating a tangible boost in interest.

Organic food sales are forecast to increase by a marginal 2% over the 2008-13 period, according to Mintel’s estimates. This highlights that the road ahead is likely to remain a challenging one for the market in the mid-term at least. However, the younger generation’s affinity for the organic proposition and their expansive repertoires inspire optimism for the long-term future of the market.

Definition

This report covers the UK retail market for food and non-alcoholic drink produced according to organic principles and standards. The main sectors covered include fruit and vegetables, meat and poultry, dairy products, fish and seafood, eggs, prepared foods and groceries, cereal products, baby and toddler foods and infant formula. It includes organic foods that are fresh, frozen or ambient.

Non-alcoholic organic drinks are analysed as part of the consumer research, but are excluded from the market size. Alcoholic drinks and sales of organic food through foodservice and catering outlets are excluded from the report.

It should be noted that market size data presented in this report represent Mintel’s best estimates of the organics market and its constituent sub-sectors.

Organic farming involves the development of management practices that aim to avoid the use of agrochemical inputs and to minimise damage to the environment and wildlife.

To be certified organic, products must derive from sustainable management practices that rely on crop rotation, biological pest control and use of natural fertilisers. Management practices avoid the use of artificial herbicides, pesticides and fertilisers, genetic modification and, for livestock production, the routine use of antibiotics, growth promoters and other drugs. For organic processed products, not less than 95% of the ingredients must be certified as organic. Products made with between 5% and 30% of non-organic ingredients can highlight the organic content – legally the label must state the percentage of total organic agricultural ingredients.

Organic production standards were first introduced in the early 1970s. The term ‘organic’ became strictly defined in European law in 1993 with the introduction of EC Council Regulation 2092/91, which ensured the strict regulation of organic food production. This EC Regulation sets minimum standards for organic production, which conform to those laid down by the International Federation of Organic Agricultural Movements (IFOAM). The Regulation also sets out the practices and inputs that may be used in organic production, covers inspection systems and also applies to processing, processing aids and ingredients in organic foods. Only organic foods originating from growers, processors and importers that are registered with an approved body and subject to regular inspection can be sold as organic.

To ensure that organic standards are adhered to, in whichever country the food is produced, the symbol or EU code number of a certification body must be clearly visible on the label of all organic foods. The new EU organic leaf logo became compulsory from 1 July 2012 on all prepacked organic food products that meet the necessary standards. Standards cover registration, certification, the environment and conservation, production, permitted and non-permitted ingredients, processing, packaging and distribution.

Organic standards are continually updated and are enforced by the certification bodies. Producers, manufacturers and processors of organic food pay an annual fee for registration with a certification body. All must keep detailed records to ensure traceability from farm to end product. Certification bodies are responsible for inspecting land and production processes, at least on an annual basis, to ensure that production follows the standards and principles laid down.

Imported products are subject to the same checks and guarantees as those produced in the UK. Products imported to the UK from other EU countries are subject to EU standards, which apply to all producers, processors and importers in the EU, which must be registered in their member state. For products sourced outside the EU, the exporting countries must demonstrate to the European Commission that their organic production systems satisfy those of the EU.

What you get

What's included

Why buy from us?

Succeed

Our reports will provide you with market data, consumer research and competitive intelligence to succeed in your market.

Instant Access

Buy now and you'll have instant access to the information you need to make the right decisions.

Opportunities

Find out what's next in the markets that matter to you: where opportunities lie and what challenges you will face.

Trusted

A business Superbrand, Mintel is a source you can trust. We have been defining and refining the Market Intelligence mix since 1972.

Table of contents

  1. Introduction

      • Definition
        • Abbreviations
        • Executive Summary

            • The market
              • Figure 1: UK retail value sales of organic foods, 2008-18
              • Figure 2: UK retail value sales of organic foods, by category, 2013 (est)
            • Market factors
              • Organic is a low priority
                • Figure 3: Factors influencing choice when buying food and (non-alcoholic) drink, March 2013
              • The younger generation are cause for optimism
                • Slowing upward mobility presents a challenge
                  • Growth in consumer spending should support growth
                    • Companies, brands and innovation
                      • No end to the decline in organic food and drink NPD
                        • Figure 4: Share of organic products in all food and drink NPD, 2009-13
                      • A steady rise in adspend
                        • The consumer
                          • Organic continues to enjoy widespread appeal
                            • Figure 6: Changes in organic food and drink purchases, August 2013
                          • The appeal of organic varies significantly by segment
                            • Figure 7: Types of organic food and drink purchased, August 2013
                          • No one benefit of organic stands out
                            • Figure 8: Reasons for buying organic food and drink, August 2013
                          • Consumers are swayed by promotions
                            • Figure 9: Attitudes towards organic food and drink, August 2013
                          • Poor price perceptions remain the biggest barrier
                            • Figure 10: Non-users’ attitudes towards organic food and drink, August 2013
                          • What we think
                          • Issues in the Market

                              • What impact has the horsemeat scandal had on the organic food market?
                                • What barriers does the market face in capitalising on the predicted growth in consumer spending?
                                  • How can brands more effectively communicate the benefits of the organic label?
                                    • Will a change in EU organic regulation benefit the market?
                                    • Trend Application

                                        • Trend: Prove It
                                          • Trend: Edutainment
                                            • Mintel Futures: Access Anything, Anywhere
                                            • Market Drivers

                                              • Key points
                                                • British origin is the most important issue in food choices
                                                  • Figure 11: Factors influencing choice when buying food and (non-alcoholic) drink, March 2013
                                                • Organic is low down on consumers’ agendas
                                                  • Growth in 25-34s bodes well for the market
                                                    • Figure 12: Trends in the age structure of the UK population, 2008-13 and 2013-18
                                                  • The market is dealt a blow by the slowdown in the growth of ABs
                                                    • Figure 13: Forecast adult population trends, by socio-economic group, 2008-18
                                                  • Value takes priority as incomes are squeezed…
                                                    • Figure 14: Consumer Price Indices, all items and food, Q1 2008-Q1 2013
                                                  • …but tentative improvement in consumer expenditure
                                                    • Figure 15: GDP, PDI and consumer expenditure, at constant 2013 prices, 2008-18
                                                • Strengths and Weaknesses

                                                  • Strengths
                                                    • Weaknesses
                                                    • Who’s Innovating?

                                                      • Key points
                                                        • No end to the decline in organic food and drink NPD
                                                          • Figure 16: Share of organic products in all food and drink NPD, 2009-13
                                                          • Figure 17: Share of organic products in total NPD in selected categories, 2010-13
                                                        • Baby food remains an important category for organic NPD
                                                          • Figure 18: Share of product categories in overall organic food and drink NPD, 2009-13
                                                        • The organic market is highly fragmented
                                                          • Figure 19: Top 15 brands in 2012, by share of launches in the UK organic food and drink market, 2009-13
                                                      • Market Size and Forecast

                                                        • Key points
                                                          • Value sales of organic have declined by over a quarter
                                                            • Figure 20: UK retail value sales of organic food, 2008-18
                                                          • The future
                                                            • Figure 21: UK retail value sales of organic foods, 2008-18
                                                          • Forecast methodology
                                                          • Segment Performance

                                                            • Key points
                                                              • Fruit and veg and dairy account for two thirds of organic food sales
                                                                • Figure 22: UK retail value sales of organic foods, by category, 2013 (est)
                                                                • Figure 23: Year-on-year % change in organic food sales, by category, 2012 and 2013
                                                              • An end to the decline in organic fruit and veg sales in 2013
                                                                • Figure 24: UK retail sales of organic fruit and vegetables, by value, 2008-18
                                                              • The organic dairy market rebounds in 2013
                                                                • Figure 25: UK retail sales of organic dairy products, by value, 2008-18
                                                              • Baby food and drink continues to grow its share of organic food sales
                                                                • Figure 26: UK retail sales of organic baby food and infant formula, by value, 2008-18
                                                              • Small decline anticipated for organic meat, fish and poultry sales in 2013
                                                                • Figure 27: UK retail sales of organic meat, poultry and fish, by value, 2008-18
                                                              • Another tough year for the organic egg market
                                                                • Figure 28: UK retail sales of organic eggs, by value, 2008-18
                                                            • Companies and Products

                                                                • Rachel’s
                                                                  • Yeo Valley
                                                                    • Duchy Originals from Waitrose
                                                                      • Seeds of Change
                                                                        • Organix
                                                                          • Green & Black’s
                                                                            • Organic Farm Foods
                                                                              • The Soil Association
                                                                                • The Organic Trade Board
                                                                                  • Abel & Cole
                                                                                    • Riverford Organic Farms
                                                                                    • Brand Communication and Promotion

                                                                                      • Key points
                                                                                        • A steady rise in adspend
                                                                                          • Figure 29: Main monitored media advertising expenditure on organic food and drink, by selected leading organic brands, 2009-13
                                                                                        • HiPP takes the lead in adspend in 2012
                                                                                          • Figure 30: Advertising expenditure on organic foods, by company, selected advertisers, 2009-13
                                                                                          • Figure 31: Share of advertising expenditure on organic foods, by company, selected advertisers, 2009-13
                                                                                        • Rachel’s invests heavily in advertising for the first time in 2011
                                                                                          • Green & Black’s cuts back on adspend in 2012
                                                                                            • TV continues to dominate adspend
                                                                                              • Figure 32: Share of advertising expenditure on organic foods, by media, selected advertisers, 2009-13
                                                                                            • Soil Association
                                                                                              • Figure 33: Share of advertising expenditure on organic foods, by media, the Soil Association, 2009-13
                                                                                            • ‘Organic. Naturally Different’ campaign in its third year
                                                                                              • Figure 34: Advertising expenditure on organic foods, by media, The Organic Trade Board, 2010-13
                                                                                          • Channels to Market

                                                                                            • Key points
                                                                                              • Supermarkets dominate distribution in organic food
                                                                                                • Figure 35: UK retail value sales of organic foods, by outlet type, 2009-12
                                                                                              • One bright spot comes from online retailers and box schemes
                                                                                              • Consumer – Usage of Organic Food and Drink

                                                                                                • Key points
                                                                                                  • Majority of Britons made organic purchases in the year to August 2013
                                                                                                    • Figure 36: Changes in organic food and drink purchases, August 2013
                                                                                                  • Organic buying peaks among under-35s and ABs
                                                                                                    • Figure 37: Consumers who have bought organic food and drink in the last 12 months, by age and socio-economic group, August 2013
                                                                                                  • Tight finances have seen consumers cut back
                                                                                                  • Consumer – Types of Organic Food and Drink Purchased

                                                                                                    • Key points
                                                                                                      • Vegetables are the most commonly purchased organic food
                                                                                                        • Figure 38: Types of organic food and drink purchased, August 2013
                                                                                                      • Purchasing of meat, poultry and dairy lags behind eggs
                                                                                                        • Under-25s are the core buyers of many types of organic food/drink
                                                                                                          • Figure 39: Selected types of organic food and drink purchased, by age, August 2013
                                                                                                      • Consumer – Reasons for Buying Organic Food and Drink

                                                                                                        • Key points
                                                                                                          • No one benefit of organic stands out
                                                                                                            • Figure 40: Reasons for buying organic food and drink, August 2013
                                                                                                          • Quality and health perceptions are key motivations
                                                                                                            • Figure 41: Consumers who buy organic food/drink because it’s higher quality and because it is better for them because it’s free from chemicals and pesticides, by age, August 2013
                                                                                                          • Animal welfare standards are less important
                                                                                                          • Consumer – Attitudes towards Organic Food and Drink – Users

                                                                                                            • Key points
                                                                                                              • Promotions would drive more organic sales
                                                                                                                • Figure 42: Attitudes towards organic food and drink, August 2013
                                                                                                              • Notable demand for more own-label organic options among over-55s
                                                                                                                • Figure 43: Agreement with the statements ‘I would buy more organic food and drink if there were more deals available’ and ‘I would like to see a wider variety of supermarket own-label organic food and drink’, by gender and age, August 2013
                                                                                                              • Limited demand for better availability at supermarkets
                                                                                                                • One in three want more information
                                                                                                                  • Under-25s are most influenced by celebrity chefs
                                                                                                                    • The horsemeat scandal has helped boost the appeal of organic
                                                                                                                    • Consumer – Attitudes towards Organic Food and Drink – Non-users

                                                                                                                      • Key points
                                                                                                                        • Price is the major sticking point
                                                                                                                          • Figure 44: Non-users’ attitudes towards organic food and drink, August 2013
                                                                                                                        • Over-55s are the biggest sceptics
                                                                                                                          • Figure 45: Selected attitudes towards organic food and drink, August 2013
                                                                                                                      • Appendix – Who’s Innovating?

                                                                                                                          • Figure 46: Share of branded vs. own-label launches in overall organic food and drink NPD, 2009-13
                                                                                                                      • Appendix – Market Size and Forecast

                                                                                                                          • Figure 47: Best- and worst-case forecasts for UK retail sales of organic food, by value, 2013-18
                                                                                                                      • Appendix – Segment Performance

                                                                                                                          • Figure 48: Best- and worst-case forecasts for UK retail sales of organic fruit and vegetables, by value, 2013-18
                                                                                                                          • Figure 49: Best- and worst-case forecasts for UK retail sales of organic dairy products, by value, 2013-18
                                                                                                                          • Figure 50: Best- and worst-case forecasts for UK retail sales of organic baby food and infant formula, by value, 2013-18
                                                                                                                          • Figure 51: Best- and worst-case forecasts for UK retail sales of organic prepared meals and grocery, by value, 2013-18
                                                                                                                          • Figure 52: Best- and worst-case forecasts for UK retail sales of organic meat, poultry and fish, by value, 2013-18
                                                                                                                          • Figure 53: Best- and worst-case forecasts for UK retail sales of organic bread, bakery and cereals, by value, 2013-18
                                                                                                                          • Figure 54: Best- and worst-case forecasts for UK retail sales of organic eggs, by value, 2013-18
                                                                                                                      • Appendix – Consumer – Usage of Organic Food and Drink

                                                                                                                          • Figure 55: Changes in organic food and drink purchases, by demographics, August 2013
                                                                                                                      • Appendix – Consumer – Types of Organic Food and Drink Purchased

                                                                                                                          • Figure 56: Most popular types of organic food and drink purchased, by demographics, August 2013
                                                                                                                          • Figure 57: Next most popular types of organic food and drink purchased, by demographics, August 2013
                                                                                                                          • Figure 58: Other types of organic food and drink purchased, by demographics, August 2013
                                                                                                                          • Figure 59: Repertoire for types of organic food and drink purchased, by demographics, August 2013
                                                                                                                      • Appendix – Consumer – Reasons for Buying Organic Food and Drink

                                                                                                                          • Figure 60: Most popular reasons for buying organic food/drink, by demographics, August 2013
                                                                                                                          • Figure 61: Next most popular reasons for buying organic food/drink, by demographics, August 2013
                                                                                                                      • Appendix – Consumer – Attitudes towards Organic Food and Drink – Users

                                                                                                                          • Figure 62: Most popular attitudes towards organic food/drink, by demographics, August 2013
                                                                                                                          • Figure 63: Next most popular attitudes towards organic food/drink, by demographics, August 2013
                                                                                                                          • Figure 64: Other attitudes towards organic food/drink, by demographics, August 2013
                                                                                                                      • Appendix – Consumer – Attitudes towards Organic Food and Drink – Non-users

                                                                                                                          • Figure 65: Most popular attitudes towards organic food/drink, by demographics, August 2013
                                                                                                                          • Figure 66: Next most popular attitudes towards organic food/drink, by demographics, August 2013

                                                                                                                      Companies Covered

                                                                                                                      To learn more about the companies covered in this report please contact us.

                                                                                                                      Organic Food and Drink - UK - October 2013

                                                                                                                      US $2,583.33 (Excl.Tax)