Spring Toward Summer

As meat sales rebound amid a sputtering economic recovery, grocers and suppliers whet shoppers' appetites with new promotions.

“I cook beef all time, about three to four times each week.”

These words — a statement by the winner of the Northeast Beef Promotion Initiative's late-winter sweepstakes — are sure to be music to the ears of grocers and meat suppliers alike. It's probably safe to assume they'd also like to hear this about poultry, pork and other cuts populating supermarket meat departments.

It could be that folks like this Connecticut shopper, a customer of Geissler's Supermarkets, are on the rise.

Dollar sales in the overall fresh meat department surpassed $1.9 billion for the year ending March 19, in food stores with at least $2 million in sales (excluding supercenters), according to data from Schaumburg, Ill-based Nielsen. That's an increase of 9.3 percent over the same period a year earlier, when the year-over-year increase had slipped to 6.7 percent, the bottom of a four-year bell curve that started with a 12 percent increase for the period ending in March 2008.

Packaged meat sales are up, too — 4.1 percent to almost $10.9 billion for the year ending March 19, according to Nielsen data.

“We try and stay seasonally relevant with the different proteins to adapt to the season and help to capture those sales for that time frame,” explains Kelly Mortensen, meat director for Salt Lake City-based Associated Food Stores. “Most generally, we feature beef, which generates the most tonnage and dollars.”

But with beef prices at record highs, Mortensen thinks it's going to be difficult to get consumers excited about beef at prices “they most likely have not seen before. We are starting to see some pushback from consumers now, and we don't believe that pricing on beef has peaked yet.”

As a result, Mortensen says, shoppers should expect to see more features on pork and poultry. “We do not want to abandon the beef category, but it may play a diminishing role with these new numbers.,” he says.

Mintel projected red-meat sales to reach nearly $71.9 billion in 2010, up 15 percent since 2005. “However, when considering the impact of inflation, the market achieves only 3 percent growth from 2005-10,” according to the Chicago-based market researcher's latest report on the red-meat category, which is showing signs that it's not recession-proof in light of softer sales since 2008, culminating in a 0.4 percent decline in 2010. Mintel attributes decreased red-meat sales to the lingering fragile economy that has prompted consumers to reduce red-meat consumption or trade down to less expensive cuts.

No Crying Fowl

Among meat/poultry users, Mintel finds that 60 percent of its panel data cite poultry as the most economical choice, vs. only 10 percent for red meat and 8 percent for pork. That's good news for companies like Butterball, which has been rolling out its springtime promotions.

“Today's consumer is looking for ways to save and prepare more meals at home,” says Heather Sheffield, seasonal brand manager for Garner, N.C.-based Butterball. “Consumers are looking for a way to use fresh turkey products, so Butterball identifies money-saving offers that families can take advantage of for weekly meal solutions.”

Trough April, Butterball teamed with Uncle Ben's rice on a dollar-off/recipe promotion distributed on Butterball's fresh tray packs. In June, Butterball will kick off another dollar-off fresh tray pack promotion with Kikkoman.

“We try and stay seasonally relevant with the different proteins to…capture those sales for that time frame.” —Kelly Mortensen, Associated Food Stores

The poultry market grew 31 percent during 2005-10 to reach $41.4 billion, or 17 percent adjusted for inflation, Mintel reports. “All segments benefited from consumers returning to home cooking during the height of the economic downturn,” Mintel says, projecting growth of 32 percent during 2010-15, “thanks to solid per capita consumption among the fast-growing Hispanic population, poultry's comparatively good price per pound, and continued emphasis from manufacturers on convenient and better-for-you offerings.”

Of course, the other cuts won't take this lying down. At this year's Meat Conference in Dallas, the Certified Angus Beef (CAB) brand presented ideas on expanding the merchandising potential of top sirloin butts and chuck rolls, offering guidance to in-store butchers on how to convert these cuts into more lucrative steaks, roasts and ribs ideal for the outdoor grilling season.

The folks at Tyson are gearing up for a summertime promotion on fresh grinds. “This program is an important facet of our ground-beef program, as we've seen an overall increase in sales for premium grinds as more consumers look for leaner ground-beef products to feed their families,” says Kent Harrison, VP of marketing and value creation at Dakota Dunes, S.D.-based Tyson Fresh Meats. “The premium grinds program includes 91 percent and leaner ground beef and source grinds from the chuck, sirloin and round,” he says.

Additionally, Tyson has launched its Star Ranch Angus beef promotion, starting this month and running through most of the summer. The promotion will include in-store point-of-sale materials, social media support and an online presence through the company's consumer site, StarRanchAngus.com.

“To further support consumer communications, we continue to post preparation videos via YouTube so that consumers have easy, fresh ideas for Star Ranch Angus beef products,” Harrison says.

In this manner, Tyson expects to beat its year-over-year sales numbers while helping its retail partners grow their businesses. “We also expect to see heightened levels of execution at the retail level by providing retailers with sales materials and helping them see value in using our branded lines across all muscle cuts,” Harrison adds.

“Demand is starting to move in the right direction. We are focused on helping retailers position our products strongly with consumers, while also giving consumers additional value through recipes, coupons and preparation information.”

Pork Projects

Meanwhile, the National Pork Board (NPB) is hoping a new marketing strategy will, by its very name, inspire home cooks to explore a wide range of new options in the kitchen. “With pork as the brand, the new campaign of 'Pork: Be inspired' shows pork's place in almost any menu, time of day, cuisine and lifestyle, based on pork's unique combination of flavor and versatility as the source of kitchen inspiration,” says Patrick Fleming, director of retail marketing at the Des Moines, Iowa-based NPB. “We are currently launching national television and print ads, as well as a digital campaign, to increase awareness of our new brand positioning among consumers.”

The pork board has developed new point-of-sale materials and recipe brochures, and is working with leading retailers to include these items at the meat case. “We also updated our retail website, PorkRetail.org, to make it a complete resource for retailers and suppliers,” Fleming notes.

Further, a retail newsletter launched earlier this year, “Pork Quarterly,” includes tips and resources to help retailers maximize their pork sales.

The pork board has set some ambitious goals for its latest promotion, Fleming explains: “Our goal is to change the way retailers think about fresh pork.”

As such, the board is aiming for, by the end of 2014, a 10 percent increase in annual consumption per capita of fresh pork and an increase in consumer awareness of how best to cook pork.

“The most basic challenge in pork merchandising is having adequate signage to show customers the variety that exists within fresh pork,” Fleming says. “Without the proper signage, consumers don't know the great options they have in fresh pork cuts. This can limit sales of featured items as well as limiting possible up-sell opportunities.”

The other challenge is education, Fleming says. That means making basic cooking information available to customers. The pork board also encourages retailers to train their employees to engage with customers and educate them about buying and cooking pork products — a good idea for the entire meat case as well.

In any case, retailers will need to monitor market conditions carefully to ensure healthy sales as consumers continue to evaluate their spending decisions. Grocers benefited from a spike in home cooking during the depths of the recession, so it's up to them to capture and hold the loyalty of their consumers, many of whom may face either buying a premium cut for dinner or filling the tank again this week.

“Times have changed, and they are evolving each day,” Associated's Mortensen says. “One never knows what the next headline is going to be, but we are not going to be bashful or reticent when it comes to featuring protein in this environment the remainder of this year. There are still plenty of great values out there, and who knows — we could establish some new trends in new protein categories which have been forced upon us by the market.”