Beef committee increases retail promotion funds

by Bryan Salvage
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CENTENNIAL, COLO. — Ten Cattlemen’s Beef Board members as well as 10 State Beef Council members who sit on the Operating Committee elected to increase retail marketing program funding by $100,000 in the area of national beef promotions and partnerships during the September Operating Committee meeting held in Denver, Colo.

This commitment is intended to develop and execute retail promotions domestically that build consumer demand for beef by stimulating incremental consumer purchases of beef throughout the year. Examples of such retail promotions include the Kraft A1 Steak Sauce in-store promotion, Anheuser-Busch holiday promotions and the middle-meats promotions that took place during summer 2009.

Since the recession began, foodservice beef sales have been down slightly by a point or two. But this slight drop translates to deep losses in the sector. As a result, the checkoff has remained committed to targeting programs in order to stay on menus so, when consumers head back to white tablecloth restaurants, the industry won’t have to rebuild share.

Exports are flat, which means the domestic retail market is the primary market currently moving U.S. beef. Although retail volume is up, retailers have also dropped prices, and in turn margins, across the store to try and capture consumers. Most of what is sold is due to feature advertising instead of usual retail prices.

Coupon redemptions are up 23% from the first six months of this year compared to last year, according to the Beef Checkoff.

"The checkoff has taken note that consumers are cooking more at home and this provides an excellent opportunity to move more product through retail than in recent years to make sure there’s a market for our cattle," said Helen Wiese, who is a Manning, Iowa, cow/calf and seedstock producer, Operating Committee member and chair of the industry’s retail committee. "All sectors of the industry are working together to promote beef — that’s a big benefit for us right now. Retailers are feeling the economic ‘crunch’ just like producers. But the good news for us is for every dollar invested, our partners in the retail sector contribute between $5-$10. That’s a large return on investment in an effort to sustain a market for our product."

In 2010, retail marketing will remain geared to moving middle meats, helping to keep the price point palatable for consumers and ensuring a market for U.S. beef, the checkoff relays.

"The investment we’ve made through the checkoff-funded muscle-profiling study and in new product and culinary initiatives is still showing positive results," Ms. Wiese said. "Look at how far we’ve come in adding value to the chuck. Now, retail programs are expanding on these results and keeping the momentum going by educating consumers and retailers.

"Producers should know and have confidence in the fact that we’ve seen a lot of success at retail in the last year and that’s why the Operating Committee found extra dollars in a tight budget to reaffirm that commitment to a program that’s helping build and maintain demand for beef," she concluded.

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