HWTR Blueprint

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The Baby Effect The Impact of Children 0-3 on
Households Attitudes Behaviors Toward Organics
and Healthy Eating
Prepared for Whole Foods Market The Natural
Marketing Institute January 2007
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Purpose and Methodology

• Purpose
• To determine the impact of young children (under
  age 3) on a households attitudes toward and
  usage of organic foods and beverages.
• Methodology
• Data was extracted from NMIs proprietary 2006
  Health and Wellness Trends Database (HWTD).
• The HWTD is a comprehensive NMI consumer database
  based on an annual research study of general
  population, primary grocery shopper American
  households the entire database includes 20,000
  consumer respondents based on attitudes,
  behavior and product usage within health and
  wellness focus on consumer packaged goods across
  multiple categories, including nutritional
  supplements conducted annually since 1999 and
  trendable nationally projectable to U.S.
  households statistically significant at the 95
  confidence level to /-1-2.
• Topic areas reviewed include
• Outlets shopped for healthy and natural products
• Past year usage of selected product categories
• Attitudes and opinions toward organic, natural
  and healthy products
• Data from the WFM Organic Fiber Study (9/06) is
  also referenced on pages 9-10.
• Groups analyzed include

Segment Abbreviation Sample Size
Households with children under age 3 Kids Under 3 411
Households with children ages 3-17 Kids 3-17 1191
Households with children of any age Any Kids 1616
Households with no children No Kids 4144
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Executive Summary

• Young children in a household have a significant
  impact on the households usage of and attitudes
  toward organic products.
• Specifically, households with Kids Under 3 are
  more likely than either those with Kids 3-17 and
  those with No Kids to
• have started using organic produce and organic
  packaged goods in the past year
• be heavier users of organic milk
• be significantly more likely to believe that
  organic foods are better for their kids and
  report theyve been buying more
  organic foods specifically because of their
  children
• While very young children have a clear impact,
  children 3-17 also play a key role. Households
  with children of any age are notably different
  (than those with no children) on numerous levels
• They are more likely to use organic beverages,
  organic milk, organic packaged foods and natural
  foods/beverages than those with No Kids
• WFM Shoppers (of whom 20 have at least one child
  in the household) show more interest in organic
  cotton children's products (blankets, clothing,
  accessories) than those who dont shop WFM
• Those with Any Kids are less likely to perceive
  organic food as too expensive or believe it is
  not a good value than those with No Kids
• Convenience is paramount for young families.
• Most parents are stressed and desire ease and
  convenience. While most report shopping for
  healthy and natural products at conventional
  grocery stores, they are significantly more
  likely than those with No Kids to also frequent
  Mass Merchandisers and Convenience Stores
• Parents are less likely than those with No Kids
  to read package labels
• Parents have less time and energy to devote to
  their own health than those with No Kids. They
  are less likely to make an effort to eat healthy,
  but are more likely to use energy/sports
  nutrition products

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WFM Opportunities

• Households with children are an important target
  market for WFM. Parents are positively
  predisposed to organics. They believe they are
  better, they buy more, they desire more choices
  and they are less impacted by price premiums than
  those with no kids. WFM should actively market
  and merchandise healthy and organic choices for
  kidsespecially those under age 3. These parents
  show particular interest and provide key
  opportunities for customer longevity, in addition
  to children being a pathway into organics.
• Households with children are key targets for
  other highly used categories fortified
  products, soy products, canned foods (promote
  organic or WFM store brand options), dairy-free
  products, organic fiber products for children and
  natural and organic personal care. Beyond
  traditional organic foods/beveragesWFM should
  market other key categories to households with
  children.
• Parents want ease and convenience. They are
  stressed and have limited time, which impacts
  where and how they both shop and eat. WFM should
  offer clear and convenient choices for parents to
  help them in making food selections for both
  their children and themselves.

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Parents Desire More Options For Healthy Foods For
Their Kids
( consumer segment who agree completely/somewha
t with statements)
I would like more selection of healthy
food/beverage products for my children
Kids Under 3 Kids 3-17
61 54
Market and Merchandise healthy food and beverage
choices for kidsespecially those under 3.
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Usage of Organics May Be Driven By Young Child In
Household
( consumer segment indicating theyve been
using product category for less than one year)
Households With Young Children More Likely To
Have Recently Started Using Organics
Agree completely/somewhat
Kids Under 3 Kids 3-17
I have tried organic foods beverages specifically because of my children 26 20
Organic foods/beverages are better for my children 52 45
Ive been buying more organic food because of my children 27 18
Lower case letters denote significant difference
at 95 confidence level Denotes significant
differences at the 95 confidence level vs. No
Kids
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HH With Kids Heavier Users of Organic, Natural
Products, But Not Produce
( consumer segment indicating usage of product
category in past year)
Product Usage in Past Year Kids Under 3 (a) Kids 3-17 (b) ANY Kids (c) No Kids (d)
Organics
Organic Packaged Foods 48d 40 42d 37
Organic Produce 54 50 51 49
Organic Beverages (excl. milk) 40d 37d 37d 29
Organic Milk 39bd 31d 32d 23
Naturals
Natural Foods 78d 73 74d 70
Natural Beverages 67 67d 67d 62
Significantly more likely than other groups to
have been using for less than one yearare new
kids driving usage?
Lower case letters denote significant difference
at 95 confidence level
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Price of Organics Is Not A Key Deterrent For
Parents
( consumer segment who agree completely/somewha
t with statements)
Lower case letters denote significant difference
at 95 confidence level
9
Awareness vs. Purchase of Baby, Toddler and
Childrens Products Made from Organic Cotton
( of shoppers who have seen/heard about organic
cotton products, shoppers who made actual
purchase of organic cotton products)
Roughly 1 out of 5 are purchasing
Among WFM Shoppers
Source Organic Cotton Study September 2006
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Purchase Intent of Organic Cotton Products for
Children
( segment VERY INTERESTED in purchasing the
following organic cotton products from any
retailer)
WFM Shoppers (a) Non-WFM Shoppers (b)
Baby blankets, sheets etc. 25b 13
Clothing for children 25b 13
Clothing for toddlers 24b 12
Baby clothes 24b 13
Baby accessories (bibs, hats, etc.) 22b 11
Top 3 Channels for WFM Childrens Organic Cotton
Buyers Catalog or Website - 38 Whole Foods
Market - 36 Boutique Clothing Store - 34
Lower case letters denote significant difference
at 95 level
Source Organic Cotton Study September 2006
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Convenience is Key for Parents
( consumer segment indicating where theyve
shopped in past 3 months for healthy and natural
products)
Those with kids are more likely to shop for
healthy/natural products at Mass Merchandisers
and Convenience StoresConvenience is Key!
Significant difference at 95 confidence level
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Parent May Not Have Time To Study Labels
Help Them Find Healthy Options
( consumer segment indicating usage of product
category in past year)
Parents have little time to study package
ingredient labelsmerchandise products in ways to
quickly help time-stressed parents identify
healthy choices.
Lower case letters denote significant difference
at 95 confidence level
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Demographic Profiles
(Demographic profile of segments)
Key Demographic Measures of Segments Kids Under 3 (a) Kids 3-17 (b) No Kids (c)
Men 44 48 48
Women 56 52 52
Average Age 33.8 38.0a 49.1ab
Married 77bc 65c 51
Mean Income 69K 75Kc 64K
College Grad or more 34bc 25 26
White 64 58 73ab
Black 13 12 10
Asian 4 6c 4
Hispanic 16c 18c 10
Lower case letters denote significant difference
at 95 confidence level
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APPENDIX Other Opportunities For Households With
Children
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Attitudes Toward Food Safety Organics Parents
Not As Concerned As Youd Expect
Agree Completely/Somewhat
Any Kids
No Kids
Significant difference at 95 confidence level
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Other Product Categories With Heavy Usage Among
Young Families
( consumer segment indicating usage of product
category in past year)
Product Usage in Past Year Kids Under 3 (a) Kids 3-17 (b) No Kids (c)
Fortified foods/beverages 73c 67c 60
Canned vegetables 88c 84 83
Soy foods 41c 36 33
Soy beverages 38c 31c 27
Non-GMO foods 56c 50 46
Dairy-free foods/beverages 44c 43c 37
Lower case letters denote significant difference
at 95 confidence level
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Those With Kids More Likely To Using Natural/
Organic Personal Care Products, Homeopathic
Remedies
( consumer segment indicating usage of product
category in past year)
Lower case letters denote significant difference
at 95 confidence level
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Sugar and SweetenersParents Want To Avoid Them,
But Often Dont
( consumer segment who agree completely/somewha
t with statements)
Attitudes Toward Sugar/Sweeteners Kids Under 3 (a) Kids 3-17 (b) ANY Kids (c) No Kids (d)
Im concerned about negative side effects of artificial sweeteners 46 47 47 48
I prefer not to serve my family anything with artificial sweeteners 39 36 37d 33
I usually check package label for forms of sugar/sugar content before I buy 37 42 41 48abc
I prefer food with no sugar added 30 37 35 42abc
No Differences between groups in past year usage
of LOW SUGAR, SUGAR-FREE, or ARTIFICIAL SWEETENERS
Lower case letters denote significant difference
at 95 confidence level
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Having Kids Can Negatively Impact Parents Eating
Habits
( consumer segment who agree completely/somewha
t with statements)
Those without kids make more of an effort to eat
healthy

• Significantly more likely to agree than those
  with kids of any ages
• I try to eat balanced meals when possible
• Ive avoided some foods to eat healthier
• I eat healthier than I used to
• Ive added foods to my diet to eat healthier
• Eating healthy is a vital part of my life
• I usually get the proper amounts of
  fruits/vegetables in my diet

While those with kids are more stressed

• Significantly more likely to agree than those
  without kids
• I live a stressful life and look for ways to
  simplify my lifestyle

And stress impacts eating habits
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But May Provide Opportunities to Market To
Parents
( consumer segment indicating usage of product
category in past year)
Those with kids show heavier usage of
sports/energy nutrition productsquick fixes for
time and energy-needing parents?
Interestingly, those with children under 3 are
the most likely to have used specialty/gourmet
foods in the past year (66 vs. 56 with kids
3-17 and 56 no kids). Do they treat
themselves to specialty items to counterbalance a
stressed, child-centric life?
Lower case letters denote significant difference
at 95 confidence level
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The Natural Marketing Institute 272 Ruth
Road Harleysville, PA 19438 Steve French,
Managing Partner e-mail Steve_at_NMIsolutions.com
phone [phone], ext. 214 fax
215-513-1713 www.NMIsolutions.com