• by Sarah Mahoney  @mahoney_sarah, November 20, 2008

As rising food costs and economic uncertainties eat away at consumers' appetites for organic products, the Organic Trade Association is readying a new marketing push to drive home the benefits of buying green.

The Greenfield, Mass.-based trade group says it is launching an advertising and PR campaign in February, and hopes that the $2.5 million effort will reach some 25 million consumers next year. Because of the rapid growth in organic sales in the last several years, "the demographic for those who buy organic has broadened, and there are so many more venues now selling organic products," says Barbara Haumann, senior writer/editor for the group. "But there's also a lot of confusion, and we wanted to help set the record straight."

In addition to advertising, which she says is likely to begin in February, the group--which represents the $23.6 billion industry--is also adding blogs and beefing up its newsletters to help consumers look more closely at organic claims.

To encourage sampling, it is expanding its existing "Go Organic! for Earth Day 2009" retailers program, and so far has commitments from almost 3,400 storefronts, including Publix, some Kroger divisions, Roundys, Giant and SuperValu Wholesale. It expects a total of 4,000 or so stores to participate in the event.

While some industry measures have shown a fall-off in organic purchases in recent months, "we won't actually know until February how 2007 sales stacked up," she says. "In our latest data, which was through June of 2007, the growth rate is 18%," she says--adding that while growth may have slowed, "we believe we'll still see considerable growth going forward. It may not be 18%, but we believe it will still be double-digit."

This year, a recent analysis by Nielsen reported that growth in organic sales slowed to 13% for dollar sales and 8% for unit sales through September, even before the stock market's turbulent October performance.

Haumann says that while consumers are certainly making trade-offs at the supermarket, "they are also looking at values and what are the wisest choices, in terms of sustainability, in terms of global climate change. There seem to be a lot of people saying, 'I'm going to go buy food and make a really nice meal for my friends and family--that's important to me.'"

So far, the latest financial results from key organic companies seem to bear that out: While growth at the high-end Whole Foods Market is slipping, companies like Green Mountain Coffee, for example, recently reported a 45% increase in its third-quarter sales, and the Hain Celestial Group--which owns such brands as Celestial Seasonings teas, Arrowhead Mills baking products and Earth's Best Organic baby food-- reported a 22% sales increase in its most recent results, to a record $237.2 million.

"And we're seeing many mainstream stores add and expand private-label organics," she says, pointing to growth at chains like Safeway.