Organic marketers turn up the heat

The organic foods industry in Canada is bulking up at the rate of beef cattle on steroids.
According to the Greenfield, Mass.-based Organic Trade Association, the Canadian market has been blessed with an annual growth rate of 20%. Organic products now account for $1.5 billion in Canadian sales a year, and that number is expected to balloon to $3.5 billion by 2005.
And while, in the past, marketers in this category have communicated the health benefits of consuming organic goods, today's advertising seems to focus more heavily on brand personality.

The organic foods industry in Canada is bulking up at the rate of beef cattle on steroids.
According to the Greenfield, Mass.-based Organic Trade Association, the Canadian market has been blessed with an annual growth rate of 20%. Organic products now account for $1.5 billion in Canadian sales a year, and that number is expected to balloon to $3.5 billion by 2005.
And while, in the past, marketers in this category have communicated the health benefits of consuming organic goods, today’s advertising seems to focus more heavily on brand personality.
Simply put, organic foods, once reserved for the tree hugger and hippie set, are prime for ‘explosive growth’ in the mainstream market, says Kurtis Hooley, managing director of Vancouver’s The Hain Celestial Group, a natural foods company that counts Yves Veggie Cuisine, Healthy Valley and Terra Chips, as well as 12 other nature brands, in its portfolio.
Hooley believes the development stems from today’s health-conscious consumers who are not only more physically active but also concerned about mad-cow disease and other disturbing food-related illnesses.
‘Canada is a ripe market,’ he says, adding that organic food manufacturers and retailers are heightening their marketing activities as a result.
‘As more people become aware, the industry players will become much more aggressive in their attempts to get consumer attention. The best way to compete, with this demographic being so wide, is through the mass-media channel.’
Certainly, Hail Celestial, which in the past has relied on sampling and coupons to drive sales, plans to invest in mass media soon. Hooley says the message will likely centre on ‘great taste and great quality.’
‘We’ll also have the statement that organic food is good for you, and we’ll cross-promote between our brands.’
He also points to the fact that supermarket firm Loblaw Companies jumped on the bandwagon with its own President’s Choice Organics brand in fall 2001, as proof that the category is heating up. ‘Organics are going mainstream,’ says Hooley. ‘The buying population is young adults and females in the 20- to 40-year-old range.’
Adds Geoffrey Wilson, VP of industry and investor relations at Toronto-based Loblaw: ‘We saw increasing consumer demand and thought we could fulfill that with a President’s Choice high-quality, high-value offering.’ Wilson reports that there are already 100 SKUs in the product line, and plans to add another 200 by year-end. In some Loblaw and Fortino stores, the entire collection is even displayed together, in a special organics section.
Meanwhile, Loblaw is promoting the new brand with three TV spots from Toronto-based ad agency Bensimon*Byrne D’Arcy, which suggest ‘a homey feel and going back to nature,’ says Wilson. ‘The key message is that it involves an organic growing process, without pesticides or chemicals.’ So far, he adds, sales are ‘exceeding expectations.’
Similarly, Austin, Tex.-based grocer Whole Foods Market saw growth potential in the Great White North. The chain, which sells organics and enjoyed sales increases of 21% for the second quarter ended May 8 over the previous year, bowed in Canada earlier this month with a store opening in Toronto. While it already has 132 locations in North America, the plan is to operate 200 in five years, including more of the 40,000-sq.-ft. venues in the GTA, as well as some in Vancouver.
According to Camille Krupa, metro marketing manager for Whole Foods Toronto, consumers in Canada should see more communications from organic foods manufacturers, who want to educate the public about their brands.
‘We’ve seen an increase in marketing activities among vendors and we’re seeing organics advertised on TV, whereas before you wouldn’t have seen that,’ she explains, adding that the organic foods trend in Canada is lagging behind that of Europe and the U.S. ‘We expect that to continue.’
A specific product category that has seen a significant boost in recent years is soymilk. According to Toronto-based market research firm ACNielsen, Canadians drank more than 28 million litres of the stuff in 2001, boosting sales by 28% over 2000. And certainly, a couple of the big players in this arena have recently invested in advertising to support their brands.
So Good, for instance, aired its first TV ad earlier this year. ‘Cow confessional’ stars an incognito bovine who guiltily professes her love for the soymilk brand. ‘The ad [created by Toronto shop Saatchi & Saatchi] is designed to appeal to the mainstream, since soymilk is now in the public domain,’ explains Daphne Tsai, marketing specialist of Vancouver-based Soya World, which produces the label. ‘The message is that it’s the best-tasting soy beverage. That’s our driving force.’
Tsai says the soy category is no longer new and has become established; therefore, while Soya World still drives home the health benefits details through its public relations campaign, there is less of a need to educate consumers through advertising.
Recently, the firm also debuted a print ad effort in various leading Canadian magazines, such as Chatelaine and Canadian Living. They feature a nude woman – with a flawless body, of course – lying on her side, with a carton of So Good balanced on her waist. These executions are meant to promote the brand’s fat-free original and vanilla flavours, and they proclaim, ‘Enjoying a healthy lifestyle never tasted so good,’ followed by the tagline, ‘It’s not just good. It’s So Good.’
With more than 35% market share according to ACNielsen, So Good also announced it would donate $20,000 to the Toronto-based Breakfast for Learning, Canadian Living Foundation in April. According to Tsai, the goal is to educate consumers about the fact that the beverage isn’t just for adults, but children too. ‘It just ties in nicely with the message we’re trying to get across – that it’s an everyday beverage.’
Similarly, Norval, Ont.-based organic food company Sunrich Valley, which predicts the total organic dairy market will almost double to $20 million by 2005, rolled out its Mu organics line in late April. Its packaging and in-store signage, which may also be used at transit shelters around participating groceries, features the slogan ‘it’s nu, it’s Mu,’ and depicts photographs of people in cheesy cow-like poses.
‘We’ve taken a different approach, which is that of fun, distinctive packaging, rather than the old pastoral scenes,’ says Paula Travado, national sales and marketing manager, who adds that a more concerted mass media campaign will probably follow in a year or two.
‘We’re trying to get rid of old stereotypes about organic milk – that it’s the same, old boring stuff. Our packaging says the milk is a fun part of a healthy, balanced diet.’
Sunrich, which reported sales of over $143 million in 2001 and expects to enhance that number to $205 million in 2002, is targeting its advertising efforts at health-conscious females between 18 and 44. However, according to Marc Stoiber, executive VP and creative director at Toronto-based ad agency Grey Worldwide, which produced the creative for Mu, another major objective is to reach new consumers, who may not necessarily care about the health benefits.
‘If you look at the current state of organics, it’s still stuck in the hippie, Amish, ye-old-farm fare era,’ he says. ‘We didn’t want to have pictures of farmers or cows, but ordinary people to show that Mu’s not just for hippies or women who don’t shave their armpits.’
Stoiber, who describes the campaign as ‘quirky with a European twist,’ says it makes more sense to approach consumers with a brand-building push, as opposed to a health-benefits claims, or a back-to-nature story. ‘Focusing on health benefits is like saying that caffeine is an important marketing message for coffee,’ he says. ‘I think that’s crap. People weren’t dropped off the back of the bus; they already know it’s healthy.’