Last week, my colleague Tom Pirovano wrote about how the economic downturn has slowed the growth of organic products to almost a standstill.   Looking at the broader health and wellness category, we are seeing similar patterns.  Grouping health and wellness claims Nielsen tracks through its LabelTrends service into three tiers based on annual growth rates, retailers and manufacturers will notice some interesting developments.

Tier 1 (15% to 26% annual sales growth): Just one claim – omega – showed any dollar growth in the last four weeks, racking up a more than 30 percent increase.  On a unit basis, products with flax or hemp seed, plant sterol, less sugar claims and probiotic claims showed poor performance in the last four- and thirteen week periods.

Tier 2 (8% to12%): There were less severe declines in this group, and with the exception of antioxidants, all of the categories continued to show growth, albeit more slowly, with “No MSG” leading the way with dollar growth of 12 percent in the last four weeks.

Tier 3 (-4% to 8%): Versus the other tiers and average food department growth rates, Tier 3 generally made up the worse performers.  Only products with reduced calorie claims performed better than average on dollar and unit terms, while cholesterol, soy and GMO-free products showed the sharpest declines.

With continued disturbing news about obesity in the U.S., as well as an aging population, health and wellness products should not be viewed by consumers as a luxury affordable only during strong economies.  The challenge for manufacturers and retailers is to drive sales and value messaging in addition to health claims to at the very least retain existing consumers and hopefully win new converts as well.

After several years of 20% to 30% sales growth, U.S. sales of organic products are showing the first signs of slowing.

While 52-week dollar sales of UPC-coded organics are up 21% vs. last year, the most recent four-week period ending October 4, 2008, shows growth of only 11.2%.  Last year, organics saw 27.1% sales growth during the comparable four-week period ending October 6, 2007.

Meanwhile, in Great Britain, organics sales growth has also slowed — to just 4%, year over year, for the most recent year, ending September 6, 2008.  In comparison, during the year ending September 8, 2007, organic products saw 18% sales growth in Britain.

Organic products are clearly here to stay, but the days of boundless growth may be over.

Read coverage of Nielsen’s findings in The New York Times.