Having worked with the emerging markets before, and namely post Soviet markets like Russia and Kazakhstan (the biggest in the CIS), and keeping an eye on the latest market developments, I can not help but notice a new emerging trend for consumption of organic products.
Organic Monitor recently wrote that organic food sales are growing rapidly in Russia, with analysts stating the market could expand by 25-30% to USD 100m (EUR 76m) this year. The main consumers of organic products are from middle to high social classes, which comprise about 20% of Russians. They are typically in the 25-45 age group, university educated, and residents of Moscow and St. Petersburg. The main purchase motives are health benefits, absence of artificial ingredients, natural flavour and safety.
In Kazakhstan, similar trends are emerging. Recently created Kazakhstan Federation of Organic Agriculture Movements (KazFOAM) has bold plans for establishing organic agriculture, distribution of organic products and overall increasing culture of organic produce consumption among urban Kazakhstanis. At the moment, they are busy setting up European organic food product imports until they establish commercial production in Kazakhstan.
I believe it’s safe to assume that organic food sales go hand in hand with consumption of other organic and sustainable products, like home cleaning products, skincare and cosmetics, baby products, clothes, etc. If the consumer is getting conscious, they are not just getting conscious with re to their food.
Method, Ecover, Bio D, Weleda, Lavera, Nature Naty’s of this world, are your products present in Russia & CIS markets? Are these markets in your expansion and distribution plans for this year? They may not be big yet, but definitely fast growing. First mover advantage could be essential in securing healthy market share going forward. I believe there is a massive opportunity for organic and sustainable product manufacturers in these markets. Transportation may be an issue (not sustainable) but nothing prevents from finding a local manufacturer and manufacturing locally?
There is a lot of talk about organic and sustainable products hitting growth ceiling in the developed markets, could geographical expansion be key to future growth?