Cuts Above The Rest
With gourmet meat sales holding steady despite a rocky economy, retailers and suppliers are working together to satisfy shoppers' appetites.
It should come as no surprise that as wallets have taken a beating, folks have cut expenses any way they can.
Grocery retailers haven't escaped consumers' trading down. But apparently, not everyone has completely abandoned filet mignon for ground chuck. According to grocers and suppliers, gourmet meats are considered an affordable luxury by many — or at least those who haven't had to punch extra holes in their belts.
"As the recession has set in, it has been surprising that the gourmet meat sales haven't dropped much," says Ken Chapin, meat director for Spokane Valley, Wash.-based Yoke's Fresh Markets. "Our customers still purchase the ready-to-cook products that are relatively simple and fast to prepare, but still look like a home-cooked product."
Despite the downturn, sales have remained steady for Cargill's Sterling Silver premium beef and pork products, according to Ozlem Worpel, Sterling Silver brand manager for the Wichita, Kan.-based company. "We have a unique position in the industry in that we are part of the retail and foodservice markets," she says. "We've found a way to reinforce our brand's positioning by focusing on the exceptional culinary quality of our products. Celebrity chefs are using our products, and because of that, we have the confidence to tell our retail partners we guarantee an exceptional experience for their customers. It takes some of the guesswork out for the retailer. The product has been 'tested' in some of the best kitchens in the country."
Total fresh meat sales were nearly $1.8 billion for the year ending Sept. 4, 2010, at stores with at least $2 million in sales (excluding supercenters), according to data from Schaumburg, Ill.-based Nielsen. That's a 3.7 percent increase over the same 52-week period in 2009, during the depths of the recession, when sales were 12.3 percent over the 2008 period.
Among gourmet meat categories, average weekly sales of beef loin at traditional supermarkets were $2,403 for the year ending Aug. 28, 2010, a drop of 1.5 percent vs. a year ago, according to data provided by Chicago-based market research firm The Perishables Group. Weekly sales of beef sirloin for the same period dropped 1.6 percent to $844. In the gourmet poultry case, duck was the big winner — with "big" defined as a 4.2 percent increase to $15 in average weekly sales; Cornish hen sales, meanwhile, dropped 10.2 percent to $76, according to Perishables Group data.
"We are seeing an increased need for value cuts, such as the tri-tips, flank or skirt steak, flat iron, and more chuck cuts. Also, source grinds have been seeing increased demand," Worpel says. "A savvy shopper in the gourmet setting is just not willing to compromise."
But such shoppers are being prudent. With the downturn in the economy, Justin Rosberg and Jason Parent — founding partners of The Meat House, a Manchester, N.H.-based chain of specialty meat stores — have noticed that their customers are more frugal.
"The economy has affected people in different ways, depending on their situation. We've definitely noted they have traded down to us," Rosberg tells PG's sister publication, The Gourmet Retailer. "Then there are people who are already shopping with us, who have traded down their purchases here in our stores." For example, some fans of The Meat House's popular marinated steak tips, which sell for $8.99 per pound, have traded down to marinated chicken, which sells for $4.99 per pound.
Retailers have been working hard with their high-end meat providers to make the case that gourmet offerings are something shoppers can't do without — and a unique reason to frequent their particular stores.
For example, Honolulu-based Times Supermarkets provides ongoing support of the Sterling Silver brand in its 18 full-service meat departments by including the brand story in its social network posts and on the grocer's website. The Sterling Silver brand was also top-of-mind during media planning efforts and often featured in the grocer's in-store flyers and coupons.
"As a Cargill brand, we have access to a number of food industry resources," Worpel explains. "We use that knowledge to benefit our partners. From culinary ideas to promotional tools to product customization, we strive to be a branded meat solution for retailers. To us, that means providing them with support and ideas to grow their meat case business."
Further, Sterling Silver taps its community of celebrity chef resources for in-store demos, recipes and professional preparation tips. Offering these points of distinction gives retailers a competitive edge in the meat case. "We believe in today's economic environment, this is a strong position for the brand to take," Worpel says. "Consumers want value and quality. We wanted to show how to create an exceptional eating experience by incorporating one high-quality cut of meat into several dishes."
Woodbury, Minn.-based Kowalski's Markets teams with Oklahoma's Premium Natural Beef to promote a line of all-natural beef, both in stores and at the upscale food retailer's website. "The consistency of their Angus genetics plays a crucial role in the consistency of their beef," says Boyd Oase, Kowalski's meat and seafood specialist. "This beef is source-verified as well for added safety."
For its part, Yoke's successfully promotes its gourmet items in weekly ads and strives to incorporate them into solutions for shoppers. "The hard part is finding enough time in our seafood/meals-in-minutes department to make all the gourmet items. We make them all from scratch in each store," Chapin says. "We have had success with seafood salads and some stuffed seafood items."
The meat team at Yoke's encourages its associates to try new recipes and ideas — for example, salmon-wrapped scallops. "We believe our guest love to see new ideas for their menu choices," Chapin notes. "Once we establish a new item, we write the step-by-step instructions and send it to all stores. One of the challenges for us is to have each store stick with the same recipe so those items are the same, store to store. We have the best success with sales when we demo the product to our guests."
Growth of Yoke's gourmet department has been steady "but still a small number as far as a category goes," Chapin concedes. "We do, however, feel that it's a draw for our stores, and that if we can develop some gourmet items that our guest can only get from our store, it will be a plus for us."
Meanwhile, Supervalu's Chicago-area Jewel-Osco stores are bringing a unique cut of beef, co-branded with a popular craft beer, to Midwestern shoppers. Cut from the cap to the top sirloin, the Samuel Adams Boston Lager Cut boasts a tender texture and strong beefy flavor.
The partnership between Samuel Adams and Dickson's Farmstand Meats in New York marks the first time a brewer and a specialty meat purveyor have teamed up to design an original cut of beef, specifically to be paired with Samuel Adams Boston Lager. The cut's October debut at Jewel-Osco — with a promotion offering $2 off the meat with a 12-pack beer purchase — was the first time the cut could be found beyond the Northeast.
The Samuel Adams Boston Lager Cut runs at a 45-degree angle to the rest of the muscle, yielding a tightly grained steak perfect for grilling and slicing. This carving method reputedly optimizes the cut's cooking properties and flavor potential, enhancing the pairing capabilities. "I recommend searing the cut to reach the sweet spot of tenderness," says meat purveyor Jake Dickson.
Gourmet meats are entering the deli department as well. Whole Foods locations across the country have started carrying handcrafted artisan salami from Salt Lake City-based Creminelli Fine Meats.
Creminelli salami is made from all-natural pork from pigs raised on small family farms and fed 100 percent vegetarian feed free of antibiotics, hormones or other chemicals; organic spices; and imported gourmet ingredients ranging from truffles to wines from Italian suppliers. The company's regional Italian specialty salamis include Salame al Barolo, Salame al Tartufo and, for the holidays, Salame della Musica and Salame Americano. "We already sell our products on our website and to many premier retailers," says owner Cristiano Creminelli, "and we are excited to share our handcrafted salamis with Whole Foods customers and expand our distribution to a larger audience."
And the recent Natural Products Expo East 2010 saw the debut of Turke's Omega-3 DHA/EPA Enriched Gourmet Deli Meats. "We like to view ourselves as the pioneers of enriching and fortifying antibiotic-free, hormone-free turkey breast with omega-3, as well as other deli meats such as roast beef, smoked hams and chicken breast," says John Forde, president of Swedesboro, N.J.-based Turke's Omega-3 Gourmet Foods. Forde's family ties to the meat industry date back to the late 1940s; his uncle, Emil Gontowski, was the first to develop and sell a cooked, processed turkey breast for the U.S. market.
What's the outlook for the gourmet meat case?
Yoke's Chapin says meat will be a component of a significant health trend. "I think one of the fastest-growing trends that's out there, and has been out for a while, is gluten-free and no MSG or preservatives," he says. "We are making our own sausages and seasoned boneless breasts items to fit that category."
Organics also continue to move, leading The Meat House to highlight these products, such as its all-natural marinated chicken, with all-natural pork soon to follow. "It wasn't something we've called out," Parent says. "With more and more customers asking for all-natural and organic meats, the poultry's all-natural status is clearly listed on the signage."
Overall, the category will benefit from consumers' continued focus on enhancing their culinary skills at home, according to Cargill's Worpel. "The Sterling Silver brand will continue to support our retail partners with the knowledge we've gained from our chef ambassadors," she says. "There is a lot of innovative thinking going on in foodservice kitchens, and we plan on taking the lead and sharing it with consumers. Knowledgeable consumers who understand the quality of their meat choices benefit our retail and foodservice partners."
It will certainly be crucial to the success of the gourmet meat category for aggressive grocers to team up with their suppliers on showing shoppers not only why these products are a cut above the rest but, as folks gradually recover from the tumult and chaos, why they're also worth spending a little extra for.
"As the recession has set in, it has been surprising that the gourmet meat sales haven't dropped much."
—Ken Chapin, Yoke's Fresh Mar kets
"We strive to be a branded meat solution for retailers. That means providing them with support and ideas to grow their business."
—Ozlem Worpel, Cargill
The smokehouse at one of B&R Foods' Super Saver stores in Lincoln, Neb., received national accolades for its work during the American Cured Meat Championship last July in Kansas City, Mo., in conjunction with the 71st convention of the American Association of Meat Processors.
Super Saver smokehouse manager Bob Voss was awarded 3rd Place Champion in the small-diameter smoked sausage class. The winning entry is sold at Super Saver smokehouses as the chain's Original Polish sausage.
"With our smokehouse meat products, value with the customer is ultimately determined by how good the product tastes," says Pat Raybould, president of B&R Stores Inc. "Bob's skill has consistently been recognized as being among the best in his field, and we're fortunate to have him on the Super Saver smokehouse team."
This year, there were 747 entries across 26 product categories; all were judged on the basis of aroma, flavor, eye appeal, color and texture by a panel of 12 food industry executives and food science professors.
Founded in 1962, B&R Stores includes four store concepts — Russ's Market, Super Saver, Save Best Foods and Grand Central Apple Market — in seven cities across Nebraska and Iowa.