For most of the post-recession years, Whole Foods Market (NASDAQ:WFM) was a stock market darling.  From January 2009-November 2013, the organic grocery stock's growth was nothing short of dramatic as the growing popularity of healthy food fueled solid same-store sales growth and an appetite for new stores nationwide. The chart below shows its meteoric growth.

WFM Chart

WFM data by YCharts

During that period, the company's store base grew by 31% to 375, while maintaining same-store sales growth of 7%-8% once the recession ebbed.

However, in the past year, that rosy growth story has turned sour and returns have been anything but healthy as the stock's price has gotten cut nearly in half. 

WFM Chart

WFM data by YCharts

The tough times began in its 2013 fourth quarter report when it dialed back its sales guidance for the current year by a percentage point as Co-CEO John Mackey conceded, "The broader economic environment seems to be impacting our ability to attract new customers at the same rate," and pointed to rising competition as a particularly challenging factor.

Those fears have proven to be warranted as Whole Foods' EPS is projected to grow less than 5% this year to $1.54. 

The organic space is getting crowded
It's no secret what's hurting Whole Foods' once rocket-like growth -- competition. The company that's been mocked as "Whole Paycheck" has seen a wide variety of newcomers enter the organic space, from younger chains like Sprouts Farmers Market and the Fresh Market to Trader Joe's and traditional grocers like Kroger and Wal-Mart, which have found organic food to be an appealing growth space.

Privately held Trader Joe's, the No. 2 player in the alternative-grocery arena, has more than 400 locations. Whole Foods has only 388, though its stores tend to be considerably larger than a typical Trader Joe's location. In recent years, Trader Joe's has expanded to major markets like Texas and Florida, a sign that it may be beating Whole Foods at its own game, with seemingly plenty of room to run. Because it's a privately held company, Trader Joe's financial results aren't public, but the company's legions of fans and long lines are evidence of its success. Trader Joe's also has the advantage of selling significantly cheaper products than Whole Foods, another reason the company may be able to open more stores over the long term.

How Whole Foods is responding
After a year of disappointing results and steadily reduced guidance, Whole Foods recently launched its first national marketing campaign. Unlike other national supermarket chains, the company has typically eschewed mainstream advertising, but the recent lukewarm performance seemed to call for a renewed push for the brand.  

The campaign centers around the slogan, "Values Matter," an attempt perhaps to distinguish the organic chain, which has always stood for fresh, healthy food, from more traditional grocers like Kroger and Wal-Mart that have recently encroached on its space. The 60-second spot combines imagery of farms, animals, and produce with narration espousing the value of knowing where your food comes from. It closes with the company's logo and the phrase "America's Healthiest Grocery Store," as it was named by Health Magazine.

In addition to that accolade, Whole Foods was also certified as the first national organic grocer and was top ranked for seafood sustainability by Greenpeace.

Separately, Whole Foods plans to introduce a system called "Responsibly Grown," in which it will rank produce on a good, better, best scale according to sustainability practices such as handling waste and providing conservation areas. 

Will Whole Foods bear fruit again?
Competition is a new test for Whole Foods, but the development shouldn't come as a surprise. For years, the organic grocer's growth and margins have crushed the broader supermarket industry, and in a free-market economy, success is supposed to inspire competition and imitation, which tends to have the effect of lowering prices and eating into brand power.

Whole Foods still has major plans for growth, but with organic food going mainstream, it seems unlikely that we'll see the industry pioneer return to its once-soaring growth rates and stock prices anytime soon. The effect of the recent ad campaign remains to be seen, but it seems geared in the right direction. For the company to maintain its competitive advantage, Whole Foods needs to hold the uniqueness of its business and to make sure consumers continue to perceive it that way.  Without that, it's just another grocery store, organic or not.