13 Sep 2012Working Paper Summaries

Entrepreneurship in the Natural Food and Beauty Categories Before 2000: Global Visions and Local Expressions

by Geoffrey Jones

How do entrepreneurs create a market? Geoffrey Jones takes a historical approach and focuses on influential figures who created new categories of natural and organic food, agriculture, and beauty products over the course of the twentieth century. At first these pioneering entrepreneurs, often motivated by ideological or religious convictions, faced little consumer demand for "green" products and little consumer knowledge of what they entailed. The creation of new categories thus involved a lengthy process with three overlapping waves of entrepreneurship. First, the diffusion of ideas through publishing, and promotion of research and education, engaged many entrepreneurs. They were, in effect, making the ideological case for natural products, and providing the basis for them to be made available. Second, entrepreneurs engaged in the creation of industry associations which could advocate, as well as give the nascent industry credibility and create standards. Finally, entrepreneurial ventures established retail stores, supply and distribution networks, and created brands. Key concepts include:

Entrepreneurial cognition and motivation frequently lay in individual, and very local, experiences, combined with strong global visions about the need for environmental sustainability.
There was a notable international transfer of ideas and concepts. Exposure to Asia, or an imagined Asia, was a significant influence on many pioneering entrepreneurs.
Many individual entrepreneurs suffered from personal illnesses which appeared to have motivated their subsequent careers.
A significant sub-set of the influential historical figures were articulate in expressing strong religious convictions.
These entrepreneurs believed that business could and should be used as a vehicle to preserve and protect the natural environment.
By the 1990s, entrepreneurs encouraged a much wider range of businesses to enter the natural categories, some genuinely, but others seeking to green wash conventional businesses. This created confusion and skepticism in consumer minds. There were also legitimacy issues caused by growing scale.

Author Abstract

This working paper examines the creation of the global natural food and beauty categories before 2000. This is shown to have been a lengthy process of new category creation involving the exercise of entrepreneurial imagination. Pioneering entrepreneurs faced little consumer demand for natural products, and little consumer knowledge of what they entailed. The creation of new categories involved three overlapping waves of entrepreneurship. The first involved making the ideological case for natural products. This often entailed investment in education and publishing activities. Second, entrepreneurs engaged in the creation of industry associations which could advocate, as well as give the nascent industry credibility and create standards. Finally, entrepreneurs established retail stores, supply and distribution networks, and created brands. Entrepreneurial cognition and motivation frequently lay in individual, and very local, experiences, but many of the key pioneers were also highly globalized in their world views, with strong perception of how small, local efforts related to much bigger and global pictures. A significant sub-set of the influential historical figures were articulate in expressing strong religious convictions. The paper concludes that by 2000 it was evident that the success of entrepreneurial pioneers in building the market for green products created a new set of issues, especially related to the legitimacy of their businesses and of the concept of greenness.