CONFERENCE REPORT: Power of Meat preview
Feb. 19, 2017
by Joel Crews
Meat alternatives are competing for a share of consumers' plates, according to the 2017 Power of Meat report.
DALLAS – As a precursor to the opening general session at the 2017 Annual Meat Conference, a packed ballroom got a preview of the always-popular closing general session, “The Power of Meat: An In-depth Look at Meat Through Shopper’s Eyes.”
The high points of the annual study of thousands of retail meat consumers, sponsored by Sealed Air and presented by Anne-Marie Roerink, principal of 210 Analytics, were underscored by one theme: “We have to get meat right.” According to Roerink, shoppers report that when deciding where to shop for food, meat ranks as the third-most important department in that decision, and there are opportunities to improve that significantly. “For retailers, we have the ability to drive the average (shopping) basket of $41 to $83 when meat is in the cart.” She added that meat sales make up between 20 percent of weekly sales for most grocery outlets and as high as 40 percent among some of the independent operators. Among the most profitable retail food companies, meat plays a more prominent role than their less profitable counterparts in the segment.
She said that looking back at 2016, meat department performance wasn’t exactly the success story many had anticipated. Dollars spent in the meat department, according to the study, were down 3.6 percent as the average number of trips declined. On the bright side, among those purchasing fresh meat in 2016, their average amount increased by 2.2 lbs. To take advantage of opportunities to make 2017 a positive, said Roerink, retailers should be aware of some of the top trends the study revealed.
One trend is that while meat and poultry are returning to the dinner plate in general, often as an ingredient in a dish vs. a center of the plate item, meat alternatives are competing for the share of plate. “They’ve done a tremendous job of communicating the benefit of their products,” she said, “and we have not.”
Meat alternatives, such as those produced by Gardein Protein International, are gaining ground with consumers.
Reasons for the allure of meat alternatives among consumers include variety, nutrition, ease of preparation and cost were the top reasons respondents of the survey gave. Fortunately, these very same attributes can be claimed by meat and poultry industry and communicating them better will enable those companies to “steal back some of those meal occasions,” Roerink said.
Another trend covered in the presentation is the movement toward food purchases being made in alternative channels, including dollar stores, drug stores, farmer’s markets and convenience stores. Understanding the appeal of these non-traditional venues and implementing them is another way retailers can win the tug-of-war.
Appealing to shoppers that are coming in the store by offering service and expertise that other venues can’t offer is one key to increasing traffic and sales in the meat department. In today’s marketplace, this means shoppers value face-to-face interaction with employees.
“Seventy-six percent of retailers tell us they are trying to move labor to the front of the case,” Roerink said, however 89 percent report that hiring and retaining quality workers is a challenge. “It’s something we’re simply going to have to solve as the role of customer service is going to increase in the next couple of years,” she said.
Other trends address promotional efforts before shoppers show up and how the vehicles are evolving, as there is a shifting away from paper ads and circulars and a migration to in-store campaigns and an emphasis on social media, digital and mobile promotions. Taking advantage of the planning that goes into meat’s role in meal times is a chance for retailers to shine and not focus solely on price.
Sales of meat products with attributes such as grass-fed, organic and natural are steadily rising.
“Let’s not just be the hottest ad in town but also make sure we’re the most relevant and using the most relevant vehicles,” Roerink said.
While price per pound has and probably always will carry the day in the retail meat case, the value assessment among consumers is changing, including considerations relating to how and where the meat was produced, the environmental impact of the food, how convenient it is to prepare.
While only a small percentage of overall sales growth, meat and poultry products with a special attribute or product claim are steadily increasing. These include products that are organic, natural, grass-fed, antibiotic-free and hormone free, all of which have seen double-digit increases each year. Explaining the benefits of these attributes is the responsibility of retailers and an opportunity to continue growing this part of the meat department.
Another growth area is among brands as “more and more, shoppers are rewarding brands,” for their innovation and this included national, specialty/artisan and private label brands.
Value-added products also continue to show consistent growth. This segment is driven by higher income shoppers who value convenience over price. Its growth can increase even more if retailers can dispel some of the myths discovered by the study related to value-added products. “That’s an area we should be able to address through our packaging, through our communications and through our labeling because this area has a huge opportunity to grow.
“How can we help you solve ‘what’s for dinner,’” is the challenge for retailers, Roerink said, “and that will go a long way in making sure 2017 is a better year for us than 2016 was.”
The full results of the Power of Meat study will be the topic of the general session at the Annual Meat Conference on Feb. 21.