HAS WAL-MART'S ENTRY INTO ORGANICS been as devastating as imagined? It was March 2006 when Wal-Mart announced it was doubling the number of organic food items in its stores to 400 and offering them at low prices. The news made other retailers anxious and organic producers sit up straighter in their chairs.
Last month, the company said stores do indeed have more than 400 organic stockkeeping units to choose from, “in line with the comments made last year that our stores were doubling their offerings,” a spokeswoman for the retailer said.
However, the vast majority of stores don't come anywhere close to that full complement. Most carry no more than 200 items, and the average supercenter offers slightly more than 100 food selections, the retailer said.
“We're continuing to see a demand by many of our customers for organic alternatives and will always tailor each store's assortment to meet the demand,” said spokeswoman Karen Burk. “The average number of organic foods customers may find in higher-demand stores is approximately 200 offerings. Of course, there will be locations that offer more than that. And some stores, where the demand for organics is lower, will not have quite the variety of selection if the demand is not there by their customer base.”
Organic farmers around the country said the retail giant is retreating from plans to sell more organic food. One industry observer thinks the organic program may have been part of the retailer's effort last year to begin courting a larger pool of shoppers outside of its price-sensitive base.
“The push into organics was part and parcel of that wandering-mind syndrome of trying to serve higher-income shoppers who were not going to leave Target,” said David Rogers, president of DSR Marketing Systems, Deerfield, Ill.
While well-educated, upper-income shoppers were the ones most likely to buy organic food in the early days, that pool of consumers has grown to include less-affluent shoppers who are no less concerned about the food they eat. Wal-Mart's program simply may be a case of too much, too soon, Rogers said.
“Wal-Mart may have done the right thing, but they may have done it too early and with too many products,” Rogers said. “Five years from now, they may have a much broader audience.”