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A Super Marketer : Health-Food Specialist's Advice: 'Sell to the Stomach' : RICHARD A. HOLMES: Q&A

February 19, 1990|Mary Ann Galante | Times Staff Writer

As far as the Holmes Organization is concerned, it's not that you are what you eat. Instead, a better slogan for the Newport Beach-based advertising and marketing firm might be that you eat what you see. That's because Richard A. Holmes, the 45-year-old founder and principal of the firm, believes that product packaging plays a big part in what we do--and don't--put in our shopping carts.

His firm does roughly half of its work in advertising, public relations and packaging of natural foods and related products. And Holmes' philosophy is that the boxes and bottles that contain our cereals, juices and everything else we devour "should sell to the stomach, not the intellect."

The product packages, he explains, should appeal to our taste buds and make us want to grab them off the grocery shelves. Holmes says that his firm is one of the largest in the country specializing in advertising and product promotion for nutritional foods.

A high-school dropout and Newport Beach native who got his start by promoting surfing films, Holmes went to New York at age 20 to learn the advertising business. After working with some of the major ad shops there, he and two partners went into the water bed business, then became a furniture manufacturer.

He started the Holmes Organization in 1972. Today, the firm's eight staffers have worked for clients ranging from Gelson's and the Natural Grocer to Kashi cereal and Brita Water Filter Systems. The shop also represents the National Nutritional Foods Assn. and claims to have designed about 400 packages and merchandising programs for companies in the natural foods industry. In a recent conversation with Times staff writer Mary Ann Galante, Holmes talked about the industry and how much packaging influences what we eat.

Q. How much has the nutritional- foods niche grown in the last several years?

A. About 10 years ago, the U.S. mar ketplace totaled about $1.5 billion. This year, it is more than $5 billion, depending on how you define it.

That's because in terms of everything that's sold that says natural, the marketplace probably totals $10 billion to $15 billion. But in terms of pure, natural foods that don't incorporate a lot of refined sugars--whole grains and things like that--the marketplace is about $5 billion, growing at the rate of about 25% a year.

Q. What has caused the growth in the nutritional foods market?

A. The consumer is demanding higher quality in his food and he's willing to pay more for it. He wants things with pesticides out, that don't have a lot of chemical fertilizers in them. The marketplace is changing.

Q. Who buys natural foods?

A. Generally speaking, it's someone who is over 24 years old and upscale in terms of education and income. It's generally a two-income family. These people are well-read and they typically have one or two children. In California, it's usually a professional family.

Q. That sounds like yuppies.

A. Sort of, but it's broader than that because you get people who are throwbacks from the '60s and then you get the '90s person, shopping side by side. Both of them have the same goal, which is to eat better food with less junk in it.

Q. Has the whole concept of health foods gotten to be a cliche? Has it gotten to be something that's difficult to market?

A. I think so. It got to be a cliche through overuse. I have used the term "natural foods" for the past seven or eight years. A lot of people want to claim something is natural or health oriented. Natural is a buzz-word of the '80s. Saying "all natural" is kind of a put-down on the product. People don't believe it any more because it has been overused. It's like the sodium statement that you see on some foods--people don't believe it because there are a lot of different ways to get around it.

Consumers are getting smart. They read labels.

Q. Are there regions of the country where health and nutrition are more important?

A. In the warmer areas, of course. But also in the East. Boston and New York are major areas, as are the Sun Belt areas. Southern and Northern California are major areas too.

Q. How much of the market is in California?

A. Of the $5-billion natural foods mar ket, $1.5 billion to $2 billion is probably in California. Probably 60% of the market in California is in the southern half of the state because there's a greater population here and it's more densely packed.

Q. How does marketing of nutritional foods differ from marketing conventional products?

A. We're talking to a different type of person generally and we can define the niche pretty closely. We talk to the stomach and not to the intellect.

We look at what's going to motivate the person's stomach because it's the stomach that's buying the product, not the intellect. I say that because when you look at what motivates this person--what makes this person want to buy this salsa versus that salsa--what's the difference?

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