FIRED UP 2008

ROSEANNE HARPER

Big, stuffed burgers, sliders and ribs spell value in their own way, and so do premium, restaurant-style steaks.

It all depends on who the customer is, retailers said, but as meat prices continue upward, value takes on new importance this grilling season.

Ukrop's, for example, tries to strike a balance between premium products, value-added items and items that appeal more to price-conscious customers.

“We always try to have that balance, but this grilling season we're paying even more attention to that,” Alan Warren, meat and seafood director for the Richmond, Va.-based chain, told SN.

“For instance, our first grilling season ad may feature steaks on the front page, but also a pork chop combination.”

Ukrop's, like some other retailers, is selling more ground beef these days and slightly less steak, but Warren said the company will be putting a tighter focus than usual on its own Ukrop's all-natural beef steaks.

Pennington Market, Pennington, N.J., is making a big thing of big, handcrafted hamburger patties.

“It's not so much related to higher beef prices, but just to give customers something different,” said Chris Rellstab, meat manager for the single-unit independent.

“We're getting $4.99 a pound for them.”

They weigh in at nearly a half-pound each, and are stuffed with blue cheese and bacon, spinach and provolone, or brie and bacon.

“We do make it clear that we're making these here in the store, and that we're using Boar's Head bacon and cheese in the stuffings,” Rellstab said.

“Beef hasn't taken too huge a jump yet, but it will, as we get farther into grilling season and the middle meats are in big demand,” he said.

“Already, we are cutting less, because sales have slowed. By that, I mean we're just cutting less at a time, so we don't have too much on display. I think it's gas prices. People are cutting down on the number of times they go shopping.”

One retailer in Baraboo, Wis., Jeff Maurer, president of Pierce's Markets, IGA stores, said he's not doing anything different this grilling season.

“The season is just starting, because it has been cooler this spring than usual. We'll focus on our beef products, as we usually do,” Maurer said.

“Each week we try to tie in other departments in the grilling ad, like bread and produce items.”

According to consumer research firm Yankelovich Partners, Chapel Hill, N.C., 57% of respondents to a recent survey said they would be “less likely to buy fancy cuts of meat in 2008.” Broken down by gender, 50% of men and 63% of women gave that response.

Grilling fans, however, often opt for the premium cuts, and some suppliers, marketers and retailers are pointing to the fact that a restaurant-style steak bought at retail and grilled at home is less expensive than eating a comparable steak in a restaurant.

Adhering to the idea that grilling and the best-quality cuts go together, some retailers are putting their top-of-the-line cuts in the limelight for grilling season.

Stew Leonard's, Norwalk, Conn., is one of those.

Ten ranchers and their wives, all in cowboy attire, will be at Stew Leonard's four stores on Memorial Day weekend, reminding customers that Stew Leonard's private-label Naked Black Angus steaks are eminently grill-worthy. Indeed, they'll be grilling the steaks right there inside the door from 9 to 5, and urging customers to taste a bite.

“We'll be talking to customers about the naturalness of the Naked Angus steaks, and we'll be pointing out the value of the benefits,” said John Butler, chief executive officer, Beef Marketing Group, a Great Bend, Kan.-based cattle producers' cooperative.

The cattle the beef comes from have never been given antibiotics or growth hormones and have never been fed animal by-products.

“For all those benefits, you don't give up flavor. In fact, the flavor and tenderness are excellent.”

SN can testify to that fact. When the private-label line was launched last fall, SN was at Stew's in Yonkers, N.Y., where ranchers demoed the steak on the weekend of its launch.

Since that day last September, beef sales overall at Stew's have risen by double digits, even as the stores kept a healthy margin, Butler told SN. Stew Leonard's worked closely with Beef Marketing Group to develop the line.

Stew Leonard Jr. himself visited Beef Marketing Group's ranches to observe the operations, and to sign off on conditions there prior to making a deal with the group to produce the proprietary line for his stores.

At this time, an electronic billboard outside Stew Leonard's Norwalk, Conn., store urges consumers to come to meet the ranchers and taste grilled Naked Black Angus steak on Memorial Day weekend.

While the Naked Black Angus beef enters its first grilling season, Raley's on the West Coast has introduced its own private-label line of Black Angus beef, which it is touting as the type of steak you would sit down to in a high-end steakhouse.

In fact, when the West Sacramento, Calif.-based chain rolled out its Raley's Black Angus beef to all 124 of its Raley's, Bel Air and Nob Hill Foods stores last month, Dewey Maroney, the chain's vice president of perishables, emphasized that very point.

“We are offering an affordable alternative to costly steakhouse dining,” Maroney said.

Another West Coast chain, Bristol Farms, Carson, Calif., is promoting its premium Greg Norman Signature Wagyu beef tri-tips, a regional favorite, just in time for grilling season.

“We are seeing more and more retailers offering thick cuts and premium cuts,” said Randy Irion, director of retail marketing at National Cattlemen's Beef Association, Centennial, Colo. “A steakhouse experience at home is a very affordable luxury.”

Meanwhile, meat processor and packer Cargill recently fired up several grills in the parking lot at Dillon's, a Kroger-owned store, in Wichita, Kan., to show off its premium Sterling Silver strip and rib-eye steaks, and offer tastes to everybody. The company will also be giving out $1-off coupons for steaks bought inside at Dillon's.

The Cargill/Dillon's event, right at the start of grilling season, coincides with the local River Festival, which draws crowds to the area.

“We'll be grilling 40 pounds of steaks there this coming weekend,” said Ozlem Worpel, product manager, Sterling Silver Premium Meats.

She went on to say that Sterling Silver brand has made a change in its going-to-market strategy as grilling season arrives this year.

“We're working closely with retailers to promote the cuts that are favorites in their particular areas. For instance, tri-tips in Northern California, and brisket in Texas. It's more of a true partnership, as we look at the specific needs of a retailer's customers.”

Jack Allen, Winter Park, Fla., consultant and professor emeritus of food marketing at Michigan State University, suggests retailers bring in a local restaurant chef to grill up some of the store's premium steaks to underscore the restaurant quality and to give shoppers the experience of tasting a super-tender, flavorful cut.

“They could offer grilling tips and, at the same time, point out that the steaks are thick-cut, like restaurant steaks, and closely trimmed — which, among other things, can help prevent flare-ups on the home grill,” Allen said.

People are eating out fewer times a week, statistics have shown over the past year. Some of those consumers may be treating themselves to premium steaks from their grocery store, but a lot of them are buying more ground beef.

And Cargill, as the summer progresses, will launch a Summer Sliders program in partnership with more than 1,100 supermarkets across the country. Point-of-sale materials and stickers on ground beef will offer recipes and direct customers to a website that will offer grilling tips and more recipes.

“We're tying into one of the hottest trends around, one that consumers have been introduced to in fast-casual and casual restaurants,” Ivan Brown, Cargill brand manager for ground beef, told SN.

“People like the little mini-burgers, and we've even got a recipe for a ‘guilt-free’ slider, using our 90% lean ground beef.”

Brown said he believes ground beef promos are useful as a tool to drive overall store sales.

“You can cross-promote in a lot of places in the store, in the bun aisle, and near dinner rolls in the bakery.”

The Summer Slider promo will get its send-off later in the summer, after the Fourth of July holiday. Random giveaways of Slip 'n Slide toys will be part of that promotion.

Indeed, giveaways are in the picture at many supermarkets, as retailers look to keep customers coming to the meat case even as prices continue to rise.

“We'll be giving away several gas grills this summer,” said Warren at Ukrop's. “We partnered up with a local concern here, Backyard Trends, to do that.”

Customers are entered for a chance to win every time they make a beef purchase.

Contests and cross-promotions will be in the forefront this summer in campaigns orchestrated by National Cattlemen's Beef Association.

“Funded by the Beef Checkoff, we'll be running contests for consumers, as we team up with different retailers and radio stations in 27 markets,” said Irion. NCBA has added another partner — Anheuser-Busch — in its beef promotions this summer.

“A.1. Sauces is our partner again this year, and with Anheuser-Busch added, a customer can get instant-redeemable coupons that can take $2 or $3 off their beef purchase,” Irion said.

He pointed out that the tie-in for pre-Memorial Day weekend will be with Anheuser-Busch's Michelob brand beer, then Budweiser later in the summer.

“Retailers are getting more and more into the promotions that feature companion products, especially during the summer months, the grilling season. They recognize that the purchase incentives work.”

Warren said he takes advantage of the promotions, and they give his beef sales a boost every summer.

“The summer grilling promotions funded by the Beef Checkoff have always gotten our customers excited about grilling, and our beef sales increase as a result,” Warren said. “We're pleased to work with the Beef Checkoff again this season.”

The Beef Checkoff Program was credited last year with pushing dollar sales of beef up 1.5% during the 17-week period from May to September 2007.

What's more, beef sales accounted for 55% of total fresh-meat dollar sales, up 2% from the prior 17-week period.

“The 2007 summer grilling season was very successful, and now we have additional co-marketing partnerships for this year's season, so we expect it to be successful,” said NCBA's Irion.

Naturally, the pork and poultry people expect to gain an advantage this summer, with beef prices pulling out ahead of pork and chicken prices.

“We do think the price differential will be beneficial,” said Richard Lobb, spokesman for the National Chicken Council, Washington, a trade organization that represents chicken companies nationwide.

“Chicken hasn't gone up as much. Costs are higher, with corn at almost $6 a bushel, but it's difficult to pass the costs on.”

The National Pork Board officials said they, too, expect to benefit from what's going on with beef prices.

“It's an opportunity to gain a share of the protein pie,” said Jarrod Sutton, NPB's director of retail marketing.

“We have programs in place that position pork as a value for retailers and for consumers.”