FRESH FOOD: AMI Meat Conference: Main course

The best retail meat executives are always hungry -- for insights on consumer preferences, pricing trends, supply and demand, and the latest merchandising techniques. But their appetite has grown even bigger as meat has appeared in the headlines on what seems like a daily basis. All this publicity heightened the sense of urgency at the Annual Meat Conference last month in Dallas.

The one-of-a-kind conference continues to be an ideal forum for the nation's meat and poultry buyers and sellers to discuss the latest trends and most pressing public policy issues. And though topical, pervasive concerns about bird flu, mad cow disease, and related food security issues feature prominently on the list right now, day-to-day in-store operational issues remain the key focal points for the vast majority of meat industry executives.

The event, which brings together smart minds from crucial points in the protein-based food chain, is organized and co-sponsored by the Food Marketing Institute (FMI) and American Meat Institute (AMI), in conjunction with the American Lamb Board, the National Cattlemen's Association (NCBA), the National Chicken Council, the National Pork Board, and the National Turkey Federation.

New research

One of the highlights of the educational portion of the meat conference this year was the presentation of results from original research on consumer perceptions about the meat case: their packaging likes and dislikes, and other factors affecting their meat purchases. The new research, presented jointly by AMI and FMI and sponsored in part by Cryovac, a division of Sealed Air, was tabbed from an online survey of 1,750 consumers nationwide, between Jan. 31 and Feb. 6, 2006. Respondents were required to be at least 18 years old, a primary food shopper for their households, and not a vegetarian or a vegan.

While much of the survey results reinforce existing knowledge pertaining to many familiar subjects, several new themes emerge as well. The state of channel blurring is one of them. Seven in 10 shoppers primarily visit conventional supermarkets to buy groceries, with 86 percent also purchasing their meat once they're there. On the other hand, a sizeable percentage of supercenter shoppers look elsewhere for fresh meat products. Only 58.7 percent remain within the supercenter channel, while 26.6 percent said they buy meat at supermarkets.

Shoppers are extremely price-driven when purchasing meat, according to the study. The majority compares meat prices across stores before shopping, as well as the prices of different cuts of meat within the store. In-store signage appears to be the most effective vehicle for promotions, followed by advertisements in direct-mail fliers or newspapers.

Appearance ranks second-highest as a purchasing driver. If price were left out of the equation, better quality and more variety would kick in to prompt most shoppers to increase their overall meat purchases. Still, three in 10 shoppers say that regardless of price or promotion, they would simply not purchase more meat than they do now.

More than eight in 10 shoppers claim that they're concerned about the nutritional content of their food. This broad concern leads them to frequently check the nutrition facts panel on food products. Some 55 percent of shoppers say they sometimes check the nutrition panel on food in general, while 22.1 percent say they check the facts almost every time. With regard to meat, however, shoppers check the nutrition panel for fresh meats much less frequently (54.5 percent) than for processed meats (72.6 percent).

What's cooking

In an average week, consumers prepare 4.3 home-cooked meals that include a meat item. They choose chicken and beef most often for the center of the plate, and pork shows up as a distant third. Shoppers say that they're also more likely to prepare fresh meats than ready-to-eat or ready-to-heat meat products.

Here's an encouraging sign: The majority of shoppers say that they enjoy the grocery trip. Tellingly, if not surprisingly, the level of this enjoyment of grocery shopping is highly influenced by a like or dislike of cooking. In fact, those who enjoy cooking tend to make more trips, spend more in an average week, and prepare more than the average number of home-cooked meals.

The organic factor

Organic meat has yet to reach the mainstream shopper. While 17.4 percent report purchasing organic meats in the past three months, 13.7 percent of shoppers aren't sure what their purchasing behavior is regarding the segment. When they do buy it, they're motivated by better taste and nutritional value as the top reasons. They purchase most of that organic meat at conventional supermarkets, though logically, they also say natural and organic stores are major outlets as well.

While awareness of case-ready meats has increased dramatically over the past couple of years, a notable portion of shoppers continues to be skeptical about the quality of the meat. While 57.7 percent think case-ready quality is about equal to the quality of meat packaged in the store, 36 percent think the quality isn't as good.

Almost three-quarters of shoppers said that they have no brand preference when purchasing meat. Those that do care are about equally divided between preferring store/private label brand and national brands.

Close to 43 percent of shoppers are aware of their primary stores' efforts to cross-merchandise nonmeat products in the meat department. They aren't sold on the practice's effectiveness, however: They say that it's done fairly infrequently, and less than one-third of shoppers say that they find the merchandising suggestions useful when they shop.

Along the same lines, meal/product suggestions and recipes -- either in the meat department or on meat packages -- apparently don't create a high level of interest among shoppers. This finding, however, stands in stark contrast to insights from another conference session, which reviewed the effectiveness of on-pack meat labels. It's also questioned by some retail meat executives who've seen labels make a difference in their own stores.

One retail meat executive, who attended the study presentation and also a separate meat-case merchandising session that delved into the issue of on-pack labels, says he remains confident that labels are powerful tools for attracting many of today's consumers to the meat case.

"Regardless of online consumer panel data that would appear to dismiss on-pack meat labels, our own in-store focus group data tells an entirely different story," notes the merchant, who requested anonymity.

Read the label

His pro-label sentiment was resoundingly endorsed during a meat merchandising session led by representatives from the National Pork Board, Yerecic Label, and the NCBA. They shared findings from the second phase of a 10-week study on the impacts of protein labeling, conducted in a controlled store test.

Karen Boillot, director of retail marketing for the Clive, Iowa-based National Pork Board; Randy Irion, director of retail marketing for the Centennial, Colo.-based NCBA; and Art Yerecic, president, of New Kensington, Pa.-based Yerecic Label, described their organizations' continuing efforts to gain further understanding of the value of on-pack labels for consumers by testing various existing labeling concepts across the entire fresh meat case.

Their organizations conducted the most recent round of labeling studies following the success of the "Beef Made Easy" and "Integrated Meat Case" programs, both coordinated with Yerecic Label.

The session's bottom line: On-pack recipe labels help educate consumers and drive sales at the meat case, with increased performance across all labeled products, regardless of the species. Incremental dollar sales gains ranged from 2.9 percent to 5.3 percent in the various meat and poultry categories.

The research, which took place during the first quarter of 2005 in two geographically dispersed supermarket chains, pitted beef, pork, and chicken packages with peel-up labels containing recipes and time-and-temperature information against the same items without the labels. Products with the labels sold better than the packages without them.

Notwithstanding the favorable outcome of such experiments with on-pack labels, the National Pork Board's Boillot says that many retailers remain wary of using them, "primarily because of cost and labor concerns. Reluctance still comes back to the cost of the labels and the added back-room labor to affix them." To a lesser degree some retailers are also concerned that on-pack labels may obscure the meat.

Recipes help sales

The labels' proponents are hopeful that ongoing store-level, sales-driven research will impart additional information and secondary supplemental viewpoints regarding further issues that might need to be examined. For one thing, retailers might become convinced that there are gains to be made, even with highly familiar meat case staples.

"Many retailers assume consumers already know everything there is to know about ground beef and boneless, skinless chicken breast, so why would a recipe help them? But as we saw in our research, although the gains were not as great in those categories as they are in other products, there's still an opportunity to get increased sales," notes Boillot.

"While we didn't label every item across every category, the entire category saw lifts," she adds, "so having products labeled actually seems to stop consumers, give them some new ideas, and open them up to more possibilities with familiar products."

Most important, says Boillot, is that meat managers involved in the controlled store tests voice support for on-pack labels. Summing up the feedback, she relates one meat manager's firsthand account: "'During the testing, I stood out in the meat case area and stopped shoppers that had picked up packages with the new labels. About 50 percent of them said they picked up the product because of the label.'"

Boillot says another manager appreciates the convenience, as did consumers. When a customer inquired about how to cook a pot roast, "'I took him right over to the case, peeled the label for him, and said that the instructions were right there.'"

Over the long term, labels can help increase overall category sales as consumers become more comfortable with purchasing meat and preparing it at home, notes the NCBA's Randy Irion. This translates into a win for both retailers and their customers.
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