Trendy new packaging and lower prices are helping organic food leave its crusty, old-fashioned image behind and gain a firm foothold in the French grocery sector. Forward-looking organic producers and retailers are investing heavily in innovation, report CAD & Catherine Sleep.
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With 2002 growth rates of 9.4% in value terms, organic products are still making the French grocery sector sit up and take notice. Despite a slight slump compared with previous years, when growth had been in excess of 10%, organic grocery products are generally outperforming their non-organic counterparts, which posted growth in the region of 4%.
Bolstered by this performance, market leader Distriborg, with its Bjorg brand, is returning to the attack, challenging retailers to afford organic products greater shelf space. “The situation is a paradox,” comments Béatrice Laroche, head of Bjorg groceries. “Organics have demonstrated a long-term growth trend, with outstanding increases in sales figures, yet retailers are still only allocating organics the same amount of shelf space, or are even cutting back.”
Organic shoppers also seek authentic flavours
Laroche’s argument is backed up by a steady expansion of organic products into new categories, to the benefit of all market segments. In this way, innovation is steaming ahead and the big event of the current season has already been unveiled. Christened “Bio Méditerranée” (“Mediterranean Organics”), the range is produced by Le goût de la vie. “One hundred percent organic, the range is based on the Mediterranean diet,” reports CEO Victor Scherrer. “Furthermore, the line fulfils the demands of customers who look for authentic flavours as well as organic ingredients.”
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By GlobalDataProduced in Le goût de la vie’s manufacturing facility in Perpignan, Bio Méditerranée has already unveiled a few of its speciality lines, such as ravioli with five vegetables or with tofu, tomato sauces with olives or with herbes de Provence, speciality pastas and an olive oil. Launched just as organic foods are enjoying a wave of innovation, Le goût de la vie is taking advantage of this to expand its traditional range with stock cubes, tortillas and pretzels, biscuits and chocolate cookies.
Innovation paramount – Kalibio looking at convenience
Le goût de la vie’s competitors in the organic grocery market anticipated this challenge and so made sure to launch a number of new products as well. “Our childen’s organic food range, Kalibio, which was launched in 2001, took a little time to establish itself in a children’s food category which already boasts many well established, non-organic brands positioned as providing a good nutritional balance,” says Jean-Michel Boyer, CEO of Vitagermine. “Now Kalibio has been given a real shot in the arm thanks to genuine innovation – mixed fruit desserts sold in multipacks of little plastic containers. The success this product is enjoying has encouraged us to take it into other markets, such as Germany, and to continue focusing on product innovation.”
This is why Kalibio has just launched a new biscuit, packaged in bags so that they can easily be carried around for an impromptu snack. This fits neatly into the “on-the-hoof” niche in which Vitagermine has heavily invested.
Another trend that is still on the up in France is vegetarianism. “This is in fact a European-wide trend,” continues Boyer. “To satisfy consumer demand, we are offering a rice pudding dessert as part of the Babybio range, available in chocolate or vanilla, as well as a 100% vegetarian menu based on quinoa.” The latter product also offers Vitagermine a way into the fair trade sector.
For Léa Vital, a rival to Bjorg with several ranges already on the shelves in supermarkets and hypermarkets, including Le Jardin Biologique and Entouka for three to twelve-year-olds, innovation is really a matter of course, with the equivalent of one new product launched every week.
Having launched an organic coffee last April, a range of teas in metal boxes in June and potato chips during the summer, this autumn the company is focusing on canned vegetables, notably vegetable purees, as well as biscuits with original recipes such as spelt & apricot cookies.
Bjorg banking on the growth of vegetarianism
For market leader Bjorg, innovation is a necessary activity to justify and in fact maintain its market dominance. “It is our duty to offer customers innovative new products and indeed to anticipate new trends,” explains Laroche. The company’s new launches in 2003 hit the mark. With two new microwaveable individual ready meals (a vegetable and quinoa provençale, and a vegetable printanière with tofu and wild rice) and two vegetarian pâtés, Bjorg is showing its faith in the market for vegetarian food. “It’s not a question of just targeting vegetarian consumers, but also of tapping the growing market for 100% vegetable foods, which is strongly linked to the concept of natural products,” Laroche explains.
Asserting an organic-wellbeing positioning, the Bjorg range is banking on consumer confidence in organic agriculture, nutritional balance and people’s demand for good tasty food, which arguably remains of particular importance in France, so proud of its culinary heritage. This year Bjorg linked the Entouka and Kalibio ranges by launching two products targeted at children: Coussy choc breakfast cereals and Turbo choc biscuits.
Even own-label ranges have invested in innovation, spearheaded by Carrefour, which has gone all-out to exploit the organics category. The company has focused on packaging, launching starch-free vegetable soups pre-packed in stand-up ‘doypack’ pouches, as well as on convenience with a microwaveable curry & rice meal, and on vegetarianism, launching a quinoa & vegetable ready meal and a quinoa & chocolate muesli.
Premium prices still holding back the organic boom
“Twenty percent of households eat organic food. This means that more than 80% of consumers have yet to be convinced,” stresses Ivan Kloboukoff, marketing director at Léa Vital. To achieve this, producers know they have to overcome the principle obstacle – price. “An average of 20-30% dearer than their non-organic counterparts, the premium payable for some organic products can even be far greater than this in certain categories, such as jam or honey,” Kloboukoff explains.
This is a real challenge, especially now that own-label producers are beginning to use price to help their products stand out. Following the example of Léa Vital, producers are working hard to lower prices – and it seems to be working. By cutting the price of a pot of savoury spread, the company immediately saw sales rise. The same happened with a fruit dessert, when the company found a way to lower the price by using a new family-sized pot.
To mark its tenth anniversary, Léa Vital has promised to push the boat out with a number of special promotions. The company will use discounts to shake up its various ranges in supermarkets and hypermarkets. For Bjorg, pricing is one of the brand’s golden rules along with nutritional balance and authentic flavours. “Our goal is to offer our products at prices that make them accessible to all, by charging a premium no greater than 15-20% over the price of their non-organic counterparts, specifies Laroche.
Organics are driving the market forward
In order to distract attention from the price difference between organic and non-organic food products, most producers are in favour of grouping all organic products together in one supermarket aisle, generally within the health food section. “In this way it is not only possible for Bjorg, with its nutritional and organic positioning, to meet the needs of shoppers who target the health foods section; it also helps customers already familiar with our range to discover other similar products they might enjoy,” explains Laroche.
Vitagermine take much the same stance, explaining that organic products are not yet established enough to stand their ground scattered about the store one by one alongside non-organic products, but benefit from being placed together. “Once organic groceries account for 5% or 6% of the market, that will be the time to distribute them into the normal shelves to sit alongside their conventional counterparts,” states Boyer. Scherrer agrees, preferring to see his Le goût de la vie products grouped together for the moment.
However Cémoi, placing great emphasis on its heritage as a chocolate maker since 1814, logically chooses to place its organic products alongside its core range of non-organic chocolate. Léa Vital’s Kloboukoff also believes that grouping all organic products together does not suit everyone. “By placing our organic cane sugar alongside other sugars we introduce a certified organic product onto a shelf with no other similarly approved products,” he explains. “Organics enable us to pull up different grocery categories. Furthermore, this shelf allocation allows us to attract the attention of new consumers who would not generally make a detour to the organic section”.
Catherine Sleep translated this article from the French with permission from its author, Hélène Aubrée-Aguesse of French retail news service CAD.
