As Pandemic Drags On, Consumers Seeking Health Drive Record Natural & Organic Sales as Retailers Adapt to Change
This article originally appeared in Presence Marketing’s August 2020 newsletter edition and on New Hope Network’s IdeaXchange.
By Steven Hoffman
More than five months have passed since the nation and world have come under the grip of the coronavirus. Today, as Covid-19 continues to surge throughout the U.S., we wait in lines to get into stores, wear face coverings (well, at least most of us), follow floor markers to help ensure social distancing, and shop quickly to get in and out with our groceries. The days of browsing, sampling product, and being entertained by large merchandising displays and the “theater of food” have made way in large part for safety and efficiency as consumers change their shopping behavior in brick and mortar stores, and increasingly turn to options including online ordering, curbside pickup and delivery.
One thing is for sure, though. The coronavirus crisis is bringing out better eating habits, based on recent sales data, as Americans seek to improve their health and immunity, and as core natural and organic consumers double down on healthy, clean food to help ensure the health and safety of their families during these “safer at home” times.
In fact, natural and organic products are experiencing significantly higher sales in 2020, and that trend may continue. After seeing a 39% spike in sales due to stockpiling for the four weeks ending March 22, 2020, compared to the same period in 2019, natural products retail sales for the four weeks ending June 14, 2020, increased 14% over the previous year, according to market research firm SPINS, as reported in New Hope Network’s Natural Products Industry Health Monitor. And that’s after back-to-back 18% increases in the four week periods ending April 19 and May 17, respectively, reported SPINS.
Chart Source: New Hope Network, SPINS
Organic Food and Beverage Sales Surge 25%
Bloomberg reported in July that Americans “are prioritizing nutrition over cost as Covid-19 infections continue to rise across the U.S.,” pointing to Nielsen data showing that sales of organic food and beverages surged 25% for the 17-week period ending June 27, 2020. Organic meat, seafood and frozen food saw the largest increases, Bloomberg reported. “We’re expecting strength to continue in organic and natural food sales,” said Bloomberg Intelligence analyst Jennifer Bartashus in the article. Given the lockdowns to prevent the spread of the virus, “a lot of people have used the opportunity of working from home to really make a lifestyle change – lose weight and exercise,” she said.
At the same time, Bloomberg noted, while unemployment has skyrocketed and value matters more than ever, declines in discretionary spending have allowed more room for premium and specialty foods, including natural and organic products. “People are starting to look at what they’re consuming more thoughtfully now,” Ted Robb, CEO of New Barn Organics, told Bloomberg. “People are not going to fly. They’re not going to the salon. Even though we’re in a recession, and people are trying to be careful, food is one area where they can spend a little bit more,” he said.
Dietary supplements, too, are benefitting from a focus on immunity and health, leading to the highest growth rate in over 20 years for this category, reported Nutrition Business Journal. NBJ projects supplement sales in 2020 will grow 12.1% across all categories, with immunity supplements growing more than 50%, to surpass $50 billion in sales. Of note, NBJ projects that e-commerce sales of nutritional supplements will grow a whopping 61.4% in 2020, compared to 7.1% in brick and mortar stores. Longer term, online sales of supplements could increase from 10% of the market in 2019 to 20% of the overall market by 2023, NBJ predicts.
Other natural and organic categories benefitting from the coronavirus crisis, according to SPINS and New Hope Network, include shelf-stable beans, grains and rice, which took off in March with 160% growth for the four weeks ending March 22, and which still reported a robust 26% growth rate in June. Sales of plant-based meat alternatives have risen significantly, too, as coronavirus cases at meat processing plants may have led to negative perceptions of the conventional meat industry and its supply chain.
Categories in sharp decline, however, as people continue to stay closer to home include cosmetics and beauty products, weight management formulas, water bottles and filtration, body care kits, deodorants and antiperspirants, and shelf-stable jerky and meat snacks, reported SPINS and New Hope.
Fighting for Foot Traffic
In examining how the pandemic is shifting consumer behaviors, research firm Gravy Analytics compared foot traffic at four leading groceries including Wegman’s, Whole Foods Market, Safeway and Publix through June 2020. Foot traffic at these stores was typical in February and early March. This was interrupted by a spike in mid-March when consumers began pantry loading. Subsequently, foot traffic at all four supermarkets in the study declined, reaching its lowest point in mid-April before leveling off in June, according to Gravy Analytics.
While all supermarkets in the study were impacted by the pandemic, Whole Foods Market fared worse, according to the data. For the week of June 14, foot traffic to Safeway and Publix was 28% and 26% lower, respectively, compared to the week of February 2. Yet, Whole Foods Market’s foot traffic was 44% lower.
“However,” the Gravy Analytics researchers emphasized, “while foot traffic is an important indicator, it doesn’t necessarily mean that fewer consumers are shopping at Whole Foods and Wegman’s. Less foot traffic in store could be a reflection of consumers opting to use new curbside and delivery services. Regular Whole Foods customers, for example, might be purchasing their groceries through Amazon instead. Consumers might simply be less familiar with Publix, Safeway, and Wegman’s curbside pickup and delivery services, making them more inclined to go into the store. While convenience isn’t a new consumer behavior trend, it is becoming more prominent as stores find new ways to give consumers a safer shopping experience, and consumers become more familiar with these services,” they said.
In a panel hosted by Winsight Grocery Business in early July, former Whole Foods Co-CEO Walter Robb expressed concern over the reduction in store traffic, and an associated “de-emphasis” on in-store merchandising during the pandemic. “One thing we’re seeing across all retailers is less trips,” Robb told the panel. “And in retail, the trip is precious, just precious. And they have stepped back significantly. The basket is gone up to counter that, so it was supposed to come out even. But the nature of it is that with the way the store is set up now, it becomes more transactional. There’s much less of a value in merchandising, etc., because folks want to get in and get out. And so, you know, whether it’s the reduction of SKUs or whether it’s the fact that you’re flattening or spreading out your displays or whatever, I think, the advantage of physical stores that from a merchandise perspective, particularly a retailer like Whole Foods, is minimized as a result of this.”
Planning When Everything Is Changing
“How do we shape our promotional strategy in a time when everything is changing?” asked Jonathan Lawrence, Senior Director of Grocery & Natural Living for Fresh Thyme Farmers Market. Based in Downers Grove, IL, Fresh Thyme’s hybrid mix of 70% natural/organic to 30% conventional product offerings in its 74 stores located throughout the Midwest help shoppers get everything they need in a value-based, one-stop shopping format, Lawrence said. “How do we provide amazing customer service and promotion and at the same time respect social distancing? How do we reach customers and support them in a safe manner? That’s the challenge, but is absolutely what is needed,” Lawrence mused.
Lawrence confirmed that, like other retailers, the customer count at Fresh Thyme is down, but the average basket purchase is up. “We are ramping up with the idea that this may come back hard in the fall,” he said. “We are starting to plan for the immune season and how we are going to tackle it differently; our responsibility is to be there for our customers. There are categories leading the way that haven’t before, such as zinc, immune support products, hand sanitizer, etc. Now, they are spiking and we are sometimes having to think outside the box with our vendors to get product on the shelf. We might opt for a different size or a different product to have something on the shelf,” he said.
Fresh Thyme plans to open a new store in downtown St. Louis in 2021, and hopes to incorporate what it is learning now into the new concept. “You are going to see the new evolution of Fresh Thyme with the new store and also with planned remodels. We’re going to craft the product mix around the customer and the local community,” Lawrence said.
“How do we change the fluidity of our supply chain and food system? We need a shorter runway in our supply system, and that’s the challenge,” said Corinne Shindelar, founder and former president of the Independent Natural Foods Retail Association (INFRA). “As an industry, we have always been about system changes and trying to make things better. We now have the opportunity to change the system pretty rapidly because we have the ears of society like never before. We could be influencing a more dynamic and robust outcome, but only if we do the work. We don’t know how long this pandemic will last. As such, I would put many contingency plans into the budget,” she advised.
To save money on delivery services – Instacart charges up to 8%, said Shindelar - she recommends that independent retailers could do something as simple as add a line to a cell phone as an ordering hotline. “We overcomplicate things,” she said. Shindelar also advised retailers to consider what to reopen. “If you were losing money at food service, with high labor costs and low margins, now is the time to consider working with local restaurants and food service operators that retailers can feature as grab-and-go meal solutions,” she advised.
Walter Robb, who served as co-CEO of Whole Foods Market when it became one of Instacart’s high profile partners, advised retailers on the Winsight Grocery Business panel to be sure to capture customer data when working with a third party delivery service. “If you don’t capture the data on your customers and know who they are, what they’re buying and be able to look at their basket adjacencies and the analytics, then you’re breathing in the dark in terms of growing business,” he cautioned.
At Cambridge Natural Foods, located in the heart of Boston, the family-owned business felt the shock of universities and colleges nearby closing, and people leaving the city for second homes when they could to escape the pandemic, said cofounder Michael Kanter. Out of an overabundance of caution, the store initially closed for a week in mid-March and then opened for curbside and delivery only. It fully reopened its doors on July 7, to the community’s – and family’s – relief. “In hindsight, it was painful to close, but we also saw that our staff and customers were vulnerable,” said Kanter. “Now, we are limiting the number of customers in the store, we’ve installed plexiglass protection, we’re doing a lot of curbside pickup and delivery, and we’ve limited hours to help keep our staff safe and sane. We’re back to about three-fifths of our normal volume,” he said.
There may be a silver lining in what we learn from the pandemic, Kanter offered. “We weren’t so conscious of public health and hygiene in public places before. We kind of know we are a part of each other but until you experience something like this, you don’t think about it. Now we are much more aware of how what we do affects others. Maybe that will propel us forward into realizing that caring and sharing are paramount in society.”
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Shift Happens: The Power of Influencers and Brands. Grab a Mug for Compass Coffee TalkTM Featuring Ari Adams, CEO, ShiftCon Media, July 23, 2020, 11:30 am EDT, Sponsored by Allegro Coffee
FOR IMMEDIATE RELEASE
Shift Happens: The Power of Influencers and Brands. Grab a Mug for Compass Coffee TalkTM Featuring Ari Adams, CEO, ShiftCon Media, July 23, 2020, 11:30 am EDT, Sponsored by Allegro Coffee
Marketers, Brands, and Influencers are Invited to Join the Conversation on the Next Episode of Compass Coffee Talk™, Hosted by Natural Products Industry Leaders Bill Capsalis and Steven Hoffman, as they Discuss New Ways to Drive Awareness Online During Unprecedented Times.
What: Compass Coffee Talk™
Episode Number 5: “The Face of New Media, Healthy Lifestyles, and Diversity: Meet Ari Adams, CEO of ShiftCon Media.”
Date: Wednesday, July 23, 2020, 11:30 am – 12:00 pm EDT
To Register: Click HERE or watch LIVE on Facebook: https://www.facebook.com/CompassNatural/
Sponsored By: Allegro Coffee
Boulder, CO (July 16, 2020) – Compass Coffee Talk™ is pleased to announce that Ari Adams, CEO, ShiftCon Media, will appear as the next featured guest on its educational, business-to-business webinar. ShiftCon Media is a nationally renowned eco-wellness online influencer and social media community that focuses on food, wellness, health, sustainability, and diversity.
Together, natural products industry leaders Bill Capsalis and Steven Hoffman will host a discussion with Ari Adams on the power of influencers during these unprecedented times: “The Face of New Media, Healthy Lifestyles, and Diversity,” Thursday, July 23, 2020, 9:30 am MDT. Marketers and brands of all sizes are invited to join the conversation for a power-packed thirty minutes and explore new ways to connect and engage with a diverse range of influencers who support healthy lifestyles.
“Compass Coffee Talk is looking forward to sharing Ari’s expertise and we support ShiftCon Media’s commitment to creating a profound and positive impact on the world around us. Now is the time to come together and leverage our collective voice,” said Steven Hoffman, Managing Partner and Founder, Compass Natural Marketing.
Shift Happens
In this lively discussion, Ari will highlight how ShiftCon’s online influencer community is adapting to change in a continually evolving time of uncertainty. “Influencers are vital to a brand's survival right now, and the traditional path of reaching new customers is no longer an option. ShiftCon provides that bridge and is a connecting point for brands targeting new audiences,” said Ari Adams, CEO, ShiftCon Media. “I am looking forward to providing insights on diversity, new media and how to accelerate change in the natural products industry.”
Additionally, Compass Coffee Talk participants will learn more about ShiftCon’s upcoming virtual conference and expo taking place on October 8-10, 2020. For more information on how to participate or to be a sponsor, visit: shiftconmedia.com.
About Ari Adams
Ari Adams is a parenting and lifestyle blogger, author, and CEO of the annual ShiftCon Eco-Wellness Influencer Conference for eco-friendly and health-conscious bloggers and influencers. She holds a master's degree in marketing and has more than 15 years of experience in the media industry. Ari is the voice behind the lifestyle and parenting blog Love, Peace & Tiny Feet; where she shares her adventures of balancing parenthood, holistic wellness, DIY crafts, recipes, and other tips for parents.
Compass Coffee Talk™ Powered By: Allegro Coffee
Compass Coffee Talk would like to give special thanks to its newest sponsor, Colorado-based, Allegro Coffee. Each episode, one webinar attendee will receive a free bag of Allegro Coffee, a specialty coffee company that believes that where and how coffee is grown matters. Since 1977, Allegro Coffee has remained committed to sourcing the highest quality coffee from farmers dedicated to environmental stewardship and worker livelihood.
About Compass Coffee Talk™
Compass Coffee Talk™ features lively interactive conversations with industry leaders and experts designed to help guide entrepreneurs and businesses of all sizes succeed in the marketplace. Hosted by natural and organic products industry veterans Bill Capsalis and Steve Hoffman, Compass Coffee Talk is produced by Compass Natural Marketing, a leading PR, branding, and business development agency serving the natural and organic products industry.
To register for the FREE Zoom Webinar, click HERE. Or watch streaming LIVE on Compass Natural’s Facebook page: https://www.facebook.com/CompassNatural/.
Contact
Bill Capsalis, Host, 303.808.3441, bill@billcapsalis.com
Steven Hoffman, Host, 303.807.1042, steve@compassnaturalmarketing.com
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Hemp Industry Call to Action: Vote Hemp Urges Community to Sign Petition Calling for Congress to Allow 1% THC Levels in Hemp
This article originally appeared in Let’s Talk Hemp’s July 9, 2020 newsletter edition.
By Steven Hoffman
Washington, DC-based advocacy group Vote Hemp is urging the hemp community to take advantage of a narrow window on Capitol Hill to sign and submit a petition telling Congress to change the legal definition of hemp to allow 1% THC. Arbitrarily set by Canadian cannabis researcher Dr. Ernest Small in the 1970s, the currently allowed 0.3% limit has proved to be problematic for growers, producers and manufacturers alike, and Vote Hemp and its supporters feel that action has to be taken now.
Even Dr. Small agrees, more than four decades later, that “a 0.3% level is very conservative,” he told Cannabis Now in December 2018. He stressed that the allowed 0.3% THC designation for hemp has had negative implications for biodiversity. “0.3% is proving a little problematical for those who wish to produce some cultivars,” he told Cannabis Now. “It’s an especially stringent criterion [for] those who want to produce CBD. Most of the varieties selected for that have in excess of 0.3%, which is kind of inconvenient.”
“We’ve been trying to think strategically; I don’t want to create false hope given that Congress is going on summer recess in a month, and may not get much done in the last few months of the general election year,” said Eric Steenstra, Executive Director of Vote Hemp. “However, farmers and producers are frustrated, and we need to start making some noise about this. We hope to submit as many signatures as we can in the next 30 days, and encourage all members of the hemp community to sign and share the petition with their friends, colleagues and co-workers.”
In changing the definition, “there would be very few cases of anybody getting their crop destroyed. While the industry continues to work on more stable varieties, people would still have to be careful, but if we moved to 1%, the number of samples that would test hot would be very limited,” Steenstra said.
“Vote Hemp had advocated for a higher level early on, but that did not make the cut in the final legislation,” Steenstra continued. “We had to work across the aisle and made a compromise to help make hemp legal back then, but now, it’s proven the standard doesn’t work for farmers. With both the Farm Bureau and the National Farmers Union having policies on the books supporting higher THC levels (1% for the Farm Bureau; 3% for the Farmers Union), that weighs in our favor.”
The petition, issued this week, beseeches Congress that “many farmers have had their crops destroyed due to the outdated definition of hemp. The hemp industry is creating good jobs in farming and manufacturing and we need to ensure the industry can continue to grow and compete with other countries that allow higher THC levels.”
“We are hoping there will be action; there’s a desperate need,” Steenstra said. “We need to get as many people involved and to recognize that this is critical to the future of the hemp industry. We need the community to step up in a big way…and quickly!”
Steenstra also emphasized that the most important thing is to get as many farmers as possible to sign the petition. “We are upset whenever we see a farmer lose their crop because of this. It’s not acceptable. We have to let Congress know that the industry is on the verge of taking off and this limit is hurting farmers and holding us back.”
Text of the Petition
Hemp is important to the future of farming in the U.S. and will create farming and manufacturing jobs for sustainable and healthy USA grown products. The 2018 Farm Bill authorized hemp production but used an outdated definition of hemp that does not work for farmers or the hemp industry. The current definition limiting hemp to 0.3% THC has proven unworkable forcing many farmers to destroy their crops because they were slightly over the limit. We need Congress to change the definition of hemp to allow up to 1% THC (tetrahydrocannabinol) so that farmers can grow hemp crops without fearing that they will later have to destroy them.
Please add your name to the petition urging Congress to redefine hemp as up to 1% THC and share this with your friends.
To Congress:
I support changing the definition of hemp to allow up to 1% THC in the plant. Many farmers have had their crops destroyed due to the outdated definition of hemp. The hemp industry is creating good jobs in farming and manufacturing and we need to ensure the industry can continue to grow and compete with other countries that allow higher THC levels. I urge Congress to change the definition of hemp now so that no more farmers will lose their crops.
Read and sign Vote Hemp’s 1% Petition here.
Let’s Talk Hemp Media Leads the Way with Virtual and In-Person Events; Announces New Partnership with RAD Expo, Las Vegas, NV, Las Vegas Convention Center, October 6-7, 2020
FOR IMMEDIATE RELEASE
Let’s Talk Hemp Media Leads the Way with Virtual and In-Person Events; Announces New Partnership with RAD Expo, Las Vegas, NV, Las Vegas Convention Center, October 6-7, 2020
National Media Platform Connects Hemp Community with Fall Trade Shows, Sets Sights on 2021, and Opens Doors to Retail and Dispensary Opportunities Nationwide.
Denver, CO (July 8, 2020) – Let’s Talk Hemp, a nationally renowned media platform, is excited to announce its latest endeavor to generate new opportunities for the hemp and CBD industries by co-producing the cannabis-themed RAD (Retail and Dispensary) Expo. Now in its fourth year, RAD Expo is a business-to-business cannabis event, taking place this fall at the Las Vegas Convention Center, October 6-7, 2020. Let’s Talk Hemp is partnering with RAD Expo for the first time and intends to bridge hemp, CBD, and cannabis together to market to retail and dispensaries.
A 100% B2B trade show, the expo will feature more than 300 retail-specific exhibitors and vendors in one setting. “Let’s Talk Hemp is proud to collaborate with RAD Expo. The in-person fall event sets the stage for the future of both industries and is a must-attend for hemp companies looking to expand their footprint in the cannabis market,” says Morris Beegle, Let’s Talk Hemp Media Co-founder and Producer of NoCo Hemp Expo and Southern Hemp Expo.
Safety First: RAD Social Distancing Measures
Let’s Talk Hemp, in conjunction with Marijuana Venture and Cannabis & Tech Today, will co-produce the in-person expo and they are working very closely with organizers and production and venue partners to enforce strict social distancing and safety measures for attendees, exhibitors, and vendors.
“We are taking extended measures to ensure our team, attendees, and community's safety and wellness during this time. We're fortunate to be working with some of the most experienced venue and event partners, such as the Las Vegas Convention Center; Freeman Event Management and our hotel partner, Sahara Cares,” said Greg James, founder of RAD Expo and Marijuana Venture.
The RAD Expo plans to implement the following COVID-19 precautions:
SOCIAL DISTANCING: Six-foot markers and spaces will be placed between exhibit booths, and time slots will be put in place at registration to control crowds.
PERSONAL PROTECTIVE EQUIPMENT: Attendees will be provided with sponsored cloth masks and hand sanitizer for their protection and the protection of those around them.
SANITATION: All registration devices and microphones will be wiped down after every use. Hygiene reminders will be placed with signage and notifications on the RAD Expo App. There will be additional designated sanitation sites stocked with hand sanitizer and disposable disinfectant wipes.
Beyond RAD + Save the Dates
Beegle and the Let’s Talk Hemp Media team are looking forward to producing more events such as this fall’s RAD Expo, a Virtual conference and trade show in November, NoCo Hemp Expo’s NoCo7 event that will take place March 25-27, 2021 in Denver, CO, and the Southern Hemp Expo, slated for Aug. 20-21 in Nashville, TN.
“We have already had a powerhouse schedule of virtual events this year, with successful turnouts at both our EARTH WEEK Virtual Conference and Trade Show and our most recent Experience Hemp SUMMER SOLSTICE event. We have our eyes set on charting a successful course to connect our community and industry with in-person events this fall and in 2021,” adds Beegle. "It will be exciting to see familiar and new faces, both in-person and online. We can unify and better serve the community with informative and appealing educational events.”
Mark your calendar for these upcoming educational events:
Third Virtual Event, November 10-12, 2020, hosted by We Are For Better Alternatives (WAFBA), in conjunction with NoCo Hemp Expo and Let's Talk Hemp Media. Details and registration will open soon.
NoCo Hemp Expo will now take place March 25-27, 2021. Due to the coronavirus pandemic, organizers had to shift plans from 2020 to 2021.
Southern Hemp Expo, Aug. 20-21, 2021, Nashville, TN.
Be RAD, Register Here
RAD Expo Registration is FREE for qualified industry professionals until July 31, 2020. After July 31st, there will be a 2-day general admission charge of $100.
Register Here: https://www.theradexpo.com/register.
Exhibitor Information:
Interested in exhibiting at RAD Expo? Select your booth at https://www.theradexpo.com/booth-registration. For information on NoCo7, Southern Hemp Expo and other events, visit www.nocohempexpo.com.
About Let’s Talk Hemp Media
Let's Talk Hemp is a leading media platform that focuses on “Changing the Cannabis Conversation.” We curate news, education, and information about hemp and cannabis to our podcast listeners, newsletter subscribers, and digital magazine readers so that they can learn more about the industry and get tips and tricks on the latest technologies. Subscribe to our YouTube channel and learn about everything from legal updates, farming, production, and new products entering the hemp and cannabis space. Let's Talk Hemp is a publication of the Colorado Hemp Company (a division of We Are For Better Alternatives WAFBA) focused specifically on the subject of industrial hemp and cannabis. Let’s Talk Hemp features news globally and shares the benefits of cannabis on health, energy, manufacturing, and the planet (HEMP). Subscribe to Let’s Talk Hemp’s weekly hemp and cannabis industry newsletter at www.letstalkhemp.com.
Contact
Steven Hoffman, Compass Natural, 303.807.1042, steve@compassnaturalmarketing.com
Morris Beegle, Colorado Hemp Company, 970.541.0448, info@nocohempexpo.com
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Register Today! Join ShiftCon Media CEO Ari Adams on Compass Coffee Talk, July 23, 11:30am EDT
The Face of New Media, Healthy Lifestyles, and Diversity: Meet Ari Adams, CEO of ShiftCon Media
Episode 5 - Thursday, July 23, 11:30 am – Noon EDT
Zoom, Admission is Free
Shift happens! Hear how your brand can and should be a part of it!
Join us for the 5th episode of Compass Coffee Talk featuring Ari Adams, CEO of ShiftCon Media, a national, eco-wellness online influencer community that focuses on food, wellness, health, sustainability, and diversity.
Hosts Bill Capsalis and Steve Hoffman will chat with special guest Ari Adams on July 23, 11:30 am EDT, for a power-packed 30 minutes. Learn how influencers are adapting to change in a continually evolving time of uncertainty and how well-established brands and those in start-up mode are pivoting quickly to reach target audiences.
Is your brand ‘shift-ready?’
Ari will share the latest update on the upcoming ShiftCon Media virtual conference taking place this Fall and will share the platform’s vision for the remaining half of the year.
Marketers are encouraged to join the conversation and explore new ways for brands to connect and engage with a diverse range of influencers who support healthy lifestyles. Compass Coffee Talk supports ShiftCon’s commitment to creating a profound and positive impact on the world around us; because now is the time to come together and leverage our collective voice.
Ari Adams is a parenting and lifestyle blogger, author and CEO of the annual ShiftCon Eco-Wellness Influencer Conference for eco-friendly and health-conscious bloggers and influencers. She holds a master’s degree in marketing and has more than 15 years of experience in the media industry. Ari is the lady behind the lifestyle and parenting blog Love, Peace & Tiny Feet; where she shares her adventures of balancing parenthood, holistic wellness, DIY crafts, recipes and other tips for parents.
THANKS TO OUR SPONSOR, ALLEGRO COFFEE! THEY WILL GIVE AWAY ONE FREE BAG OF COFFEE ON THIS WEEK’S EPISODE OF COMPASS COFFEE TALK.
About Compass Coffee Talk™Take a 30-minute virtual coffee break with Compass Coffee Talk™. Hosted by natural industry veterans Bill Capsalis and Steve Hoffman, Coffee Talk features lively interactive conversations with industry leaders and experts designed to help guide entrepreneurs and businesses of any size succeed in the market for natural, organic, regenerative, hemp-derived and other eco-friendly products.
Compass Coffee Talk™ is produced by Compass Natural Marketing, a leading PR, branding and business development agency serving the natural and organic products industry. Learn more.
COVID Crisis Update: Natural Products Retailers Respond to New Normal by Opening New Stores
This article originally appeared in Presence Marketing’s July 2020 newsletter edition and on New Hope Network’s IdeaXchange.
By Steven Hoffman
As the United States slowly re-opens for business with the coronavirus pandemic entering its fifth month, many Americans are still playing it safe as cases continue to surge in states and regions throughout the country. Restaurants and bars are re-opening, however, with crowd capacities limited by public health regulations, food service businesses are still nowhere near where they once were. And, as the pandemic has shuttered day camps, benched Little League games, cancelled concerts and limited other warm-weather activities, families and kids are staying much closer to home this summer.
As such, grocery stores – including the nation’s natural foods stores – continue to play an essential role in feeding Americans during the pandemic crisis. Several natural food retailers we talked to anticipate there will not be much of a traditional “summer slump” in sales this season.
In fact, a number of retailers are taking advantage of the moment to open new stores. Boulder-based Alfalfa’s Market announced in mid-June it was taking over a former Lucky’s Market location in nearby Longmont to open a third store to serve Colorado’s Front Range population. Los Angeles-based Erewhon is adding two new stores to its five-store chain in the next 12 months. PCC just opened its 14th natural foods store in the Seattle area; and while it postponed Grand Opening celebrations, Natural Grocers opened a new store in Cedar City, UT, on June 10. Publicly held natural products retailer Sprouts, which CEO Jack Sinclair describes as “more of a farmers market than a grocer,” is moving ahead with plans to open 20 stores in key markets across the country, and like many retailers, has expanded at-home delivery and curbside pickup, as well as significantly increased its e-commerce sales. In addition, pandemic notwithstanding, conventional grocer Schnuck’s unveiled its brand new “EatWell” natural food concept store in Colombia, MO, on June 24.
To help reassure customers and workers, many of these retailers have enacted strict COVID guidelines. For example, Maryland-based MOMs Organic Market published COVID-19 Action Steps on its website, and Natural Grocers also informs its customers about COVID safety on its website.
“Grocery Is the Business to Be In”
“Our comps are off the charts,” said Tony Antoci, CEO and owner of Erewhon, the legendary natural foods chain in Los Angeles. Antoci, a food service distribution veteran, purchased the original single Erewhon location in 2011, and self-financed the growth of the chain to five stores, with two additional locations planned to open between now and March 2021. “We’ve seen a 300-400% increase in grocery and produce sales since the coronavirus crisis began, he said. “Protein sales grew four-fold until the end of May; now we are starting to see a leveling off, but our deli and prepared food sales are increasing as our customer base starts to get back to a new normal. We also ramped up our web ordering and delivery capabilities – something we were trying to engage but never got around to – and we had a healthy online business in a week. Now, we are averaging 200-250 online orders across five stores per day. If this was a restaurant, I would not open a new location, but grocery is the business to be in,” Antoci said.
At Jimbo’s Naturally, a five-store independently owned chain in San Diego, customer counts have decreased since the coronavirus crisis began, but they’re more than made up for in the increased average purchase, noted founder and CEO Jimbo Somek. “People don’t want to make as many trips if they can avoid it, but the average ticket is twice as high as it was before the pandemic,” he said. Somek also admitted, “It’s one thing to plan for increased demand, however, it’s another thing when the stores are doing two to three times the sales they were doing the day before. There were a lot of long days,” he said. When asked about potentially opening a new store, Somek replied, “I don’t know if it’s a good time or not to open new stores. The challenge is to know where all this is going,” he reflected.
UNFI Stock Surges
In serving all this retail growth, leading natural foods distributor UNFI (NYSE: UNFI) saw its stock price surge 45.8% in the past three months. “Several food companies are benefiting from rising demand owing to increased at-home consumption and stockpiling trends amid coronavirus,” wrote analysts at Zacks Equity Research in late June. “The packaged food space is especially gaining on such trends as the lockdown has prompted shoppers to buy and hoard packaged food and beverages. This has boosted sales of several food players, including United Natural Foods Inc. (UNFI). United Natural’s ability to cater to the rising demand amid the pandemic reflects its robust market position and the important role it plays in North America’s food supply chain,” the analysts concluded.
In related news, Sprouts Farmers Market (Nasdaq: SFM) was ranked on June 18 by Zacks Equity Research as a top growth stock, acknowledging that it is a long-term beneficiary of the pandemic. Kroger (NYSE: KR), too, has been outperforming the stock market as a beneficiary of the “eat at home” trend driven by the pandemic, along with the company’s moves to cut $1 billion in costs and invest in digital growth. Bank of America Merrill Lynch analyst Robert Ohmes reiterated a Buy rating on June 19, noting that he believes Kroger will continue to see strong sales even as COVID-related restrictions are lifted in many areas. Natural Grocers (NYSE: NGVC), too, saw its stock price more than double to well over $12 per share at the end of June from a low of $5.80 on March 12 when the pandemic first struck the U.S.
Consumers Are Leaning in to a Healthy Lifestyle
Driving sales is a growing number of consumers seeking out healthier, more nutritious products during the COVID-19 crisis to boost immunity and health. “Far from abandoning their natural lifestyle during COVID-19, natural products shoppers are widening their preferences, seeking and avoiding various ingredients, label claims and certifications,” states COVID-19 and Navigating the Path Ahead: Supporting The Natural Products Consumer, a report published on May 29, 2020, by leading market research firms SPINS and IRI. Leading the charge, said SPINS/IRI, are paleo products, plant-based meat alternatives, baking products and staple items, household cleaning items, soap and bath preparations, natural remedies to help support immunity and reduce stress and anxiety, and value-based products as many people struggle through unprecedented economic times brought on by the COVID-19 crisis.
In addition, according to Laura Batcha, CEO of the Organic Trade Association, consumers are purchasing more organic products than ever before. Organic products sales topped $55 billion in 2019, up 4.6% from the previous year, and as health comes into focus, many organic categories have seen demand increase even further. Organic produce sales jumped 50% in the early days of the pandemic, and by spring 2020, sales were still up by more than 20%, Batcha noted.
“It’s hard to know what’s ahead of us, but consumers will continue to trust in and depend on the organic label,” said Batcha. “Organic producers and processors – indeed the entire organic supply chain – have been working around the clock through this difficult time to keep our stores filled with healthy, toxic-free and sustainably produced organic food and products. Organic is going to be there for the consumer.”
Speaking at the United Fresh LIVE virtual conference on June 17, Tonya Antle, cofounder of the Organic Produce Network (OPN), corroborated that organic produce has outperformed the conventional produce category at retail during the pandemic. According to Antle, OPN’s latest retail scan data show that both volume and dollar sales of organic produce were up more than 16% during the month of May. In addition, according to OTA data, organic staple categories including dairy, eggs, bread, pasta, rice, grains and baking supplies are expected to see increased growth in 2020, along with organic vitamins and immunity-related products.
Controversy over Face Masks
The surge in grocery and natural products sales has certainly not come without its challenges. The wearing of face masks, required in many municipalities and public and commercial places, for instance, has become divisive and some conflicts in stores have happened. According to TribLive, more than 30 lawsuits have been filed against Giant Eagle over the grocery chain’s face mask policy, claiming it is discriminatory under the Americans with Disabilities Act. The Mirror UK reported on June 22 about a Walmart incident in which a defiant customer refusing to wear a mask got into a scuffle with a security guard.
“It’s a very difficult position for us to put our staff in, whether it’s an 18-, 19-year-old college student working, or a single mom, a dad,” Bryan Neiman, operator of Neiman’s Family Market, a small Michigan grocery chain, told Time Magazine in reference to face masks. Neiman’s has signs posted asking customers to wear facial coverings, and shoppers can get a mask at customer service, he said. But, according to Time, he’s telling his employees not to confront mask-less customers, for fear of triggering a confrontation. The magazine reported that similar incidents have happened all over the country.
Texas-based grocer H-E-B, which initially required customers to wear face masks in mid-April, announced in early June that it was relaxing its policy; now, shoppers are no longer required to wear face masks in its stores, reported Grocery Dive. The chain still encourages customers to wear face coverings. In addition, wearing masks will remain mandatory for employees and vendors, Grocery Dive reported.
Seasonal Promotions Affected in 2020
As retailers scrambled to respond to the tectonic shifts in consumer buying behavior brought on by the coronavirus crisis, any focus on seasonal sales and promotions was stalled, said Donnie Baldwin, Senior Director of Conventional Grocery for the Central and Western U.S. for leading natural products broker Presence Marketing / Dynamic Presence. “For 2020, we are staying busy serving our retail partners’ immediate needs,” he said, but the crisis impacted promotional sales and planning for such holidays as Easter, Mother’s Day, Memorial Day, Father’s Day and more. “However, while retailers may miss the seasonal sales this year, they’ve got their hands full keeping the store shelves stocked as full as they can,” he said.
“The good news is the average dollar ring per basket is up, but while the head count of customers shopping in stores is down – or they are shopping quickly through the store – it has impacted sales of seasonal items and impulse items,” Baldwin said. “As we talk with account executives around the country, buyers are still focused on staple items. They want to make sure they’ve got control of the supply chain on staples. That’s been a priority, and the good news is we are starting to see them get a handle on that.”
Baldwin’s counterpart, Jim Crotty, Senior Director of Conventional Grocery for the Eastern U.S. for Presence Marketing, added that retailers are looking at Fall and the holidays, but many are still not quite ready to focus on new items, or execution has been slowed. “Operations and taking care of their people are coming first right now,” said Crotty. “Come September, they might start bringing new products in; it is just happening at a slower pace. We are presenting holiday items such as eggnog and pumpkin flavors now and will continue to do so. Hopefully, we will be able to see things open up in November/December,” he added.
Meanwhile, Baldwin noted that some of his team members have been getting creative in leveraging technology and developing YouTube video presentations for retail partners, a sample of which can be viewed here.
“I really feel that by late in the Third Quarter and early in the Fourth Quarter, things are going to start opening up and retailers will start getting back to the basics,” Baldwin predicted. “This industry is very adaptive and resilient and we always look to find a way to carry on.”
Resources
The Pandemic Shows Us the Genius of Supermarkets: A Short History of the Stores that – Even Now – Keep Us Supplied with an Abundance of Choices
Atlantic Magazine, July/August 2020
https://www.theatlantic.com/magazine/archive/2020/07/supermarkets-are-a-miracle/612244/
Market Research Report: COVID-19 and Navigating the Path Ahead – Supporting the Natural Products Consumer
SPINS/IRI, May 29, 2020
https://www.iriworldwide.com/IRI/media/Library/SPINS-Joint-Thought-Leadership-5-28-20.pdf
Tracking Coronavirus Closures at Food and Beverage Factories
By Food Dive, Updated June 19, 2020
https://www.fooddive.com/news/tracking-coronavirus-closures-at-food-and-beverage-factories/576559/?mc_cid=5c0261a1e5&mc_eid=49fe8c77e3
What’s Next for the Hemp Industry? Experience Hemp SUMMER SOLSTICE Virtual Conference & Expo Highlights Innovation; Call for Unity
This article originally appeared in Let’s Talk Hemp’s June 25, 2020 newsletter edition.
By Heather Collins
2020 has been a pivotal year due to the coronavirus pandemic, which has made a tremendous impact nationwide and globally. These uncertain times have forced businesses, farmers, restaurants, and the hemp community to shift quickly and respond to safety concerns to protect industries.
The producers of the NoCo Hemp Expo and the Experience Hemp SUMMER SOLSTICE Virtual Conference & Trade Show made the hard decision to reschedule NoCo7 to the following year, which will now take place March 25-27, 2021.
“The decision to reschedule NoCo7 was not easy, but we felt the need to protect everyone’s health and safety. This community is so collaborative. That’s what’s going to make this industry stand out as we look towards the future,” said Morris Beegle, Let’s Talk Hemp Media Co-founder and Producer of NoCo Hemp Expo. “We’re excited about in-person events, but until we get the green light, we will continue to plan virtual conferences that further educates and unites our industry.”
Additionally, NoCo Hemp Expo producers are expanding multimedia platforms, including a year in review, fall virtual conference & trade show, a hemp-themed digital magazine, podcasts, weekly newsletter, and more. Stay tuned for additional details on NoCo7 at www.nocohempexpo.com.
SUMMER SOLSTICE Conference Highlights Innovation; Call for Unity
As NoCo7 organizers chart a new course for the second half of this year, the recently held Experience Hemp SUMMER SOLSTICE Virtual Conference & Trade Show, held June 16-19, 2020, was well received.
More than thirty guest speakers, including presenting sponsor PureHemp Technologies, kicked off conversations centered on the evolution of hemp and its potential during these ever-changing times. Participants accessed six live webcast Supersessions, which covered important topics relevant to the industrial hemp market today:
Innovation: Technology Advances Across the Hemp Supply Chain
Investor Outlook & the Financial Future of The Hemp Industry
Food Sovereignty, Nutrition & Hemp’s Role
Bast & Hurd: Industrial Hemp Opportunities in Building, Biocomposites, Biofuels & More
The 2020 Hemp Crop: Harvesting, Drying, Handling & Finding Markets
Among the highlights included an earnest discussion on the arbitrary .3% vs. the 1% solution in which hemp advocates declared the current ruling as a roadblock for farmers. “We need to change federal guidelines while working with the USDA. We can do that by telling the stories of the farmers. Their stories will hopefully get us there so we can stop decriminalizing the pioneers of our industry. Without the farmers, we have nothing,” says Doug Fine, bestselling author, hemp farmer, and renowned industry advocate.
Beegle agreed, “There is so much passion in our industry, and this .3% burden should not be on the farmer’s shoulders. Our only option in getting legislation passed is to stand together. We know there is a better solution out there, we need to unite on all fronts.”
Additionally, panelists discussed hemp’s potential in using the entire plant for fiber, textiles, building materials and more, and addressed hemp as a key ingredient for food sovereignty.
Participants also heard from investors regarding hemp’s economic outlook and viability as a commodity beyond the CBD market. “Fiber and hurd are the next big thing. Before, it was all about CBD and smokable flower. Let’s get the right suppliers with the right buyers and bring the best products to market,” said Julie Lerner, CEO, PanXchange, Inc. “We are in a nascent stage, and we still have some growing up to do, but need to be taken seriously.”
Geoff Whaling, a hemp industry leader, offered sound advice for hemp farmers and manufacturers during these uncertain times. “Buckle down. Believe in your business and do not let anyone test your conviction,” said Whaling, Collective Growth Corporation. “In the words of a famous quote, ‘The dreams never die, just the dreamers.”
Dreaming big might be the plan for many hemp farmers this year, but dreaming too big without the right strategy could be troublesome. “I encourage every farmer out there right now to talk about their end-use. Have a plan in place for the hemp you put in the field today,” said Andrew Bish, CMO, Bish Enterprises. “Decisions made later are not good – sort it out now, before it’s too late.”
Traceability and supply chain were also significant points of discussion during the conference. Panelist Joe Witte urged companies to integrate an authentic supply chain and one that is trustworthy. “Embrace traceability because the companies and manufacturers that realize that traceability is everything are the ones who will win.”
Sustainability and Food of the Future
Hemp plays a vital role in sustainability and has the potential to be a superfood. It is high in antioxidants and could appeal to people everywhere for its health benefits. However, there are still some challenges that food brands face in order for them to include hemp as an ingredient in food.
“We are putting a chokehold on this planet with the limitations. We need to be building the relationship with this plant,” said Winona LaDuke, hemp farmer, and nationally known environmental activist. “It’s all about cooperation these days. We need to learn together and form the next economy in equality and in our food system.”
Investors believe that there is still a learning curve when it comes to hemp, yet they remain hopeful. “The birth of an industry doesn’t happen overnight. Entrepreneurs and investors need to recalculate, especially right now,” explained Patrick Rea, CEO, and Founder, Canopy Boulder. “Hemp companies need to take a look and a lesson from the natural products industry and study its success, including dynamics, value propositions, and growth over time.”
If you are interested in learning more about the Experience Hemp SUMMER SOLSTICE Virtual Conference & Trade Show, visit the content Library and viewing pre-recorded archive footage from around the world.
What’s Next: Fall Event – WAFBA Virtual Conference and Trade Show
We Are For Better Alternatives (WAFBA), in conjunction with NoCo Hemp Expo and Let’s Talk Hemp media are also pleased to announce plans for a third virtual event coming this fall on November 11-13, 2020. Details and registration will open soon.
Making Waves in the Dairy Industry: Kalona SuperNatural™ Goes Above and Beyond During Unprecedented Times
FOR IMMEDIATE RELEASE
Certified Organic Dairy Honors June’s National Dairy Month by Supporting Regenerative Agriculture and Small Scale Family Farmers as a Sustainable Solution to Protect Livestock and Preserve the Land for Future Generations
Kalona, IA (June 22, 2020) – Kalona SuperNatural, an emerging, certified-organic, grass-fed dairy producer and brand is making waves during this year’s National Dairy Month by remaining resilient during these unprecedented times. According to the International Dairy Foods Association, National Dairy Month was created in 1937 to encourage Americans to consume more milk to fix the over surplus of product.
This past spring, many conventional dairies were forced to dispense milk because of a lack of demand. Since the pandemic began earlier this year, Kalona has been busy filling distributors’ large orders and working closely with its more than 40+ Amish and Mennonite dairy farmers in eastern Iowa.
Kalona’s CEO and Founder, Bill Evans, was recently quoted in a series of articles published by Presence Marketing, the nation’s largest independent natural and organic food brokerage firm and New Hope Network, an internationally recognized media leader in the natural products industry. Evans indicated that this is a crucial time for dairies, such as Kalona, to be recognized for the ripple they are making in helping the dairy industry regain strength.
"The conventional guys are having issues because they’ve got a large portion of their manufacturing set up for food service; there was no place for that to go a month ago, and it's still limited," Evans says. "We’ve been able to accommodate a 25-30% increase in sales volume, whereas larger producers are shorting people. Kalona SuperNatural has been more successful than others in balancing our organic milk supply."
With more than six months left on the books for the year, Kalona SuperNatural not only has its eye on the state of the industry, they are also paying close attention to the fields.
Going Beyond Organic
Kalona SuperNatural creates delicious, certified organic cream-topped dairy products that are non-homogenized and batch-pasteurized to preserve the fresh flavors. The Amish and Mennonite farmers that are part of the Kalona SuperNatural family of farms take a holistic approach to farming and have done so for the past 100 years.
The farmers believe in allowing their cows to engage in their natural behaviors and move freely in open pastures. This grazing practice mimics the natural movement of wild herds in times passed and follows regenerative agriculture methods, a sustainable approach to farming. When dairy cows are pasture-grazed, they become a boon for combating climate change.
Kalona also encourages its farmers to practice a technique called mob grazing, which means a farmer will put their herd out to graze on a small plot of land daily. They will continue to rotate the herd to various parcels of land, letting the grazed plots rest and rebuild naturally. This technique is done without the use of pesticides and fertilizers and provides cows with plants and grasses rich in nutrients. The result contains more nutritious milk for consumers.
In Support of Regenerative Agriculture
As awareness of climate change grows, Kalona SuperNatural is looking at innovative farming practices that are traditional, yet sustainable. “We are looking to utilize farms as a force for good,” says Phil Forbes, Kalona SuperNatural’s Director of Supply Chain.
“What’s beautiful about regenerative agriculture is that it’s not prescriptive,” Forbes says. “Regenerative agriculture provides us with a framework of modern techniques done sustainably. We want our farmers to manage their land in a sustainable manner that works within the context of their land. There's creative freedom in that model for farmers, and the outcome is net positive for the entire ecosystem."
Evans adds, “At Kalona, we’re ‘Dairy Proud’ all year long, beyond National Dairy Month. Every purchase of our products is a vote for a healthier planet.”
Where to Find Kalona SuperNatural
Kalona SuperNatural products are available at leading retailers in the western U.S., including Whole Foods Market, Natural Grocers, Sprouts Farmers Market, Fresh Thyme, Hy-Vee, and other independent natural food stores, co-ops, and grocers. Visit kalonasupernatural.com/store-locator.
For wholesale and sales inquiries, please contact Sharon Lake, Supply Chain Manager, sharon.lake@opengatesgroup.com.
About Kalona SuperNatural
Kalona SuperNatural is based in a thriving organic farming community in the heartland of America - Kalona, Iowa. They work with small, sustainable Amish and Mennonite family farms to produce delicious, minimally-processed organic dairy products from pasture-grazed cows. Kalona SuperNatural offers a full line of certified organic dairy products. Learn more at kalonasupernatural.com.
Media Contact
Steven Hoffman, Compass Natural, tel 303.807.1042, steven@compassnaturalmarketing.com
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