Organics on NPR's Marketplace

NPR's marketplace had a quick segment on organics in light of Whole Foods earnings report due out on Wednesday.

I'm quoted noting that organic consumers who believe strongly in organics will stick with it, but they will seek out value. They key for Whole Foods is how well they execute in value categories and shift their image. (They are succeeding beyond expectations in organic milk, their private label supplier tells me). My overall point was perhaps missed: organic consumers in this climate are shopping value, wherever it is, which is why Whole Foods is emphasizing the segment with products and even tips from its shoppers.

- Samuel Fromartz

Comments

[J.Lardaro]

I would agree with Ms. Lowery that this is slightly misleading. Yes, Whole Foods Market is showing the effects of the troubled economy, albeit for different reasons than what you propose.
The point is made that consumers will continue to buy organic foods because of the benefit to their bodies, but they will try to get them as cheap as they can. What is cheap? Is it cheap to purchase produce that is inedible and tastes like its flavor and nutrient content has gone on vacation? Is it cheap to purchase avocados at 2 for $1 that are primarily a pit with green skin? There is a lot of “suckering” going on right now in grocery with some retailers using d-grade produce as a loss-leader to get us into their doors. As a consumer, I am pissed when I have to spend 5 minutes trying to find 3 apples that aren’t bruised or brown and when I have to discard $15 worth of produce because it is spoiled and/or flavorless. Whole Foods does a consistently good job in providing QUALITY perishable products and there is great value in being able to enjoy the food you have spent your hard-earned dollars on.
So why is Whole Foods Market feeling the effects (as are other big-box retailers)? (Perceived) trust and simplicity. Trust; There is mounting insecurity with our food system and the perception is that if you know the person you are buying your food from it is safer. Co-Ops tend to operate in a much smaller space with smaller teams. As WFM has grown the footprint of the stores has gotten bigger. The bigger the store, the more difficult it is to create that one-on-one experience between customers and team members that Whole Foods was traditionally known for. I remember shopping at the Ridgewood, NJ store every week and the fish guy would have a recommendation waiting for me. That experience has been greatly impacted by the grandiosity of the newer (and expanded) stores. Simplicity; if there is one thing that effects the perception of WFM not being a value-oriented shop it is the hyper-stimulating effects of tables stockpiled and craftily displayed, often with “specialty” items. Whole Foods could benefit from getting rid of some of those tables, tooting their own horn about their private label items that are competitively-priced and taste good, and putting their best foot forward 365.

[Sam Fromartz]

J., where were Lowery's comments?

I spent this whole interview talking about "value" as the post above makes clear. I distinguish value from cheap, that is, getting the best value for your money. That is why consumers are shifting dramatically to private label -- they are trying the products, and if they prove worthwhile or equivalent, are buying them. Why? Because they get good "value."

So I agree with you, consumers don't want "cheap" in the sense of a waste of money because the product is so inexpensive it spoils or tastes bad or is not worth it. But they do want value and are seeking it in droves.

My point was similar to yours: they have to shift their image and I think are mid-way in that process. The question is how that shift will play out at a time when same-store sales are flat or shrinking.

[Sam Fromartz]

Oh Lowery's comments were at the NPR site linked to in the post.