Organic Food and Beverages Market Trends

Growth Drivers  

• Increased accessibility and expansion of distribution channels: The expansion of distribution channels, both online and offline has improved the accessibility of organic food and beverages, thereby driving market growth. The rapid rise of online marketplaces that capitalize on providing organic products is a testament to the market growth. Additionally, new organic products are being launched in different segments to capitalize on the growth.
  
  For instance, in March 2024, Pip Organic launched Pipstick, a 100% organic fruit bar without added sugar or preservatives, while REBBL launched Smoothie Starter in May 2024 which allows consumers to blend a protein smoothie conveniently.
• Growing demand for non-GMO products: Due to increasing awareness of the potential ramifications on health associated with GMO products, the preference for non-GMO products has increased leading to an uptick in the market. As per a study conducted by the International Food Information Council Foundation’s Food and Health Survey in June 2020, consumer interest aligned with products that had non-GMO ingredients. The survey also highlighted that consumers choose non-GMO as the third most influential marker behind natural and steroid-free labels when choosing a product. In June 2024, Organic India launched regenerative Tulsi tea which was organic certified.
• Rising impact of social media in promotion: The positive promotion of social media has played a huge role in the market growth. As per google trends data, the search terms for organic food and organic beverages have seen a steady rise in the last 5 years. Social media platforms such as Instagram, Facebook, X, TikTok, and Reddit have been instrumental in increasing the demand for organic food and beverages by highlighting the benefits and fostering a sense of community among like-minded consumers.
  
  As per a study published on Research Gate in July 2023, 52% of consumers stated that social media impacted their awareness of organic products. Due to this, key market players are actively investing in social media presence to take advantage of the engagement.

Challenges  

• High costs in production: A key factor impeding the market is the high cost of production which increases the cost of the final product which affects accessibility. Since sourcing raw materials requires significant investments in labor and sustainable practices, the eventual retail price can be affected. Additionally, obtaining the organic certification may turn out to be costly for small-scale businesses. The higher price of organic food and beverages due to rising operational costs can be a challenge for consumers in emerging economies.
• Shorter shelf lives: Since organic food and beverages are preservative-free, they have shorter shelf lives. This affects buyer behavior as organic products are bought in lower quantities. The use of organic products in long journeys is also impacted due to this.