Many U.S. consumers don’t understand the purpose of the USDA organic label or the regulations behind it, according to a new report from Mintel.
The report on organic food and beverage shoppers in the U.S. found 51% believe labeling something as organic is an excuse to charge more. In addition, 38% say the term organic is a marketing term with no real value or definition.
“Considering the typically higher cost of organic foods and beverages, consumers are increasingly hard pressed to justify the added expense,” Billy Roberts, senior food and drink analyst at Mintel, said in a press release. “As such, sales have hit something of a plateau, where they likely will remain until consumers have a clear reason to turn to organics. This could come in the form of a growing number of lower-cost organic options, bringing a new degree of competition to the category.”
Certain demographics have other misperceptions about the organic label, Mintel found. Less than 40% of Gen Xers trust that organic-labeled products are actually organic, while only 40% of Millennials know that organic products are highly regulated.
“Consumers are confused when shopping for organics due to the large selection, confusion over natural versus organic claims, and limited regulation of the term ‘natural,’” said Roberts.
“This skepticism could be leading to some degree of consumer apathy, as shoppers may not perceive any real benefits to going green,” he added.
The report also found that younger consumers are much more likely to purchase and consume organic products. Sixty percent of Millennials bought an organic food or drink in the last three months for themselves and others.
In contrast, 51% of Baby Boomers and 58% of the Swing Generation (born 1933-1945) said they do not eat any organic products.