Natural products are expensive. Most shoppers think so. If you lower your prices to match conventional products, will shoppers change their minds? Probably not. Here’s the true story of one retailer who tried.
Did you know that natural and organic foods are in a “premium” class that is completely separate from gourmet and conventional foods? Neither did John Mackey, CEO of Austin, TX-based Whole Foods Market when he agreed to acquire arch competitor, Boulder, CO-based Wild Oats Markets for $565 million in February 2007. Fast forward to December 9, 2008, and Whole Foods is suing the Federal Trade Commission (FTC) which is still trying to block the deal based on the flawed logic that natural and organic constitute a “premium” category of foods that only these two competitors sell, and that by acquiring Wild Oats, Whole Foods will have monopoly pricing power that will harm consumers.
Independent natural products retailers don’t diagnose, treat, prevent or cure disease, but they do help millions of Americans on the path to well being. Independent natural products retailers can’t legally practice medicine, but their knowledge of nutrition and genuine empathy and concern supports those who are trying to get and stay well. Tens of millions of American consumers enjoy better health because there is a helpful natural products retailer nearby.
In the early 1970s, when natural products were just getting started, most food shoppers did not strongly believe that, “You are what you eat!” Perhaps just two in 100 shopped in natural foods stores to avoid the highly processed foods in conventional supermarkets. Today, 20 out of 100 shoppers say that they have healthy food habits, a tenfold increase from 30 years ago.