FOR IMMEDIATE RELEASE
Contact: Nancy White
The Natural Marketing Institute
215.513.7300 ext. 225
Nancy.White@NMIsolutions.com

Organic Food & Beverage Sales Increase 18%; Household Penetration Decreases

Harleysville, Pa. (February 22,2005) – The Natural Marketing Institute (NMI) has published its 2005 Organic Consumer Trends Report™ (OCTR) which indicates that 2004 organic food and beverage sales were $10.9 billion, an increase of 18% versus 2003. The study reports that approximately 30% of U.S. consumers (or 62 million adults) use organic products, down from a high of 40% in 2003.

In addition, while organic sales were increasing, consumer awareness of organic foods has also grown to the point that 90% of the population reports they have heard of organics. This far exceeds consumer awareness of other subjects such as fortification, sustainable agriculture, functional foods, biotechnology, net carbs and trans-fat, to name a few.

Despite this increase in consumer awareness and sales growth, the decline of overall household penetration of organic products shows a shift in consumption patterns based on NMI's organic consumer segmentation. According to Maryellen Molyneaux, President of NMI, "This apparent paradox may indicate increased usage among a dedicated user base which translates into higher sales."

NMI has identified four distinct organic consumer segments based on strengths of attitudes and usage:

• Devoteds: 9.2% of the general population (and 31% of all Organic Users): Devoteds are committed, zealous and have high organic usage and spending rates. This group has fully incorporated organic products into their lives.

• Temperates: 16.7% of the general population (and 56% of all Organic Users):  Temperates are pragmatists, with moderate attitudes and account for half of all organic spending. Temperates are attempting to fit organic usage into their existing lifestyle.

• Dabblers: 3.8% of the general population (and 13% of all Organic Users): Dabblers are non-committal, disproportionately male and the least health conscious of the three groups. For them, organic usage is more about hipness than health.

• The remainder of the population are Reluctants at 70.3%. This group may have some level of belief in the benefits of organic usage, but are not using organic products.

"The Temperates and Devoteds together represent 90% of all organic spending. To further differentiate, Temperates have the highest percentage of that spending (at 51%) while Devoteds account for 40%. These two segments represent the most opportunistic groups that manufacturers need to reach in order to maintain the sales growth the industry has come to expect. The OCTR can be used to gain insight into the attitudes, behaviors, entry drivers, influences and demographics of these two influential segments," states Molyneaux.

The OCTR is a comprehensive compilation of marketing information across the entire organic marketplace and provides product usage analysis of organic user consumer groups, as well as projections of the size and growth of the organic marketplace. It is an invaluable resource for companies defining, targeting and communicating to consumers in the organic marketplace. For more information on the OCTR and to view the table of contents, please visit http://www.nmisolutions.com/r_organic.html.

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NMI is a strategic consulting, market research, and business development company specializing in the health, wellness, and sustainable marketplace. For more information on the Organic Consumer Trend Report or NMI's other proprietary research reports and services, visit NMI's web site at www.NMIsolutions.com.

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