This year’s All Things Organic conference and expo showcased necessity as the mother of invention.  Slumping sales and a weak economy have forced the industry to innovate just to hold onto customers.

In a 2009 briefing on the organic packaged food market, Euromonitor International said the largest threat to the future growth of organic products is price sensitivity among U.S. consumers in the current economic climate.

“In previous years, many consumers were willing to trade up to premium products,” the briefing said. “However, more consumers are looking to trade down, as they can no longer afford to even try some premium products, much less purchase them on a regular basis.”

The response has been for some companies to expand their product offerings, such as Clorox’s Green Works laundry detergent, hitting store shelves this summer, and Rain Organic Vodka’s new lavender flavor.

Others are expanding their reach as they try to drive sales. Safeway’s O Organics line, for example, is now in other grocery chains, such as Albertsons.

Still, people were all smiles, saying that while their sales were down, their companies had still experienced growth.  In their eyes, weathering the economic storm means that they’re just that much more prepared for the recovery.

Watch the audio slide show below:

(Video by Reuters/Ian Sherr)