Growing the meat market

A close look at shoppers’ buying habits reveals that smart grocers can use the meat case to develop loyal customers. By Craig Levitt The meat department is one of the few areas within a store that can either draw consumers in or drive them away. As such, the meat department has always been an important differentiator for traditional supermarkets. As the economy continues to struggle, those with successful meat departments have been able to retain customers as fewer consumers seem willing to change their overall shopping habits. According to the fifth edition of the Power of Meat, An In-Depth Look at Meat Through the Shoppers’ Eyes a joint study released by the Washington D.C.-based American Meat In­stitute (AMI) and the Arlington, Va.-based Food Marketing Institute (FMI) at last month’s Annual Meat Conference, the recession continues to impact food purchasing and consumption behavior within the meat department as well. The reports states that 40% of consumers now make different meat purchasing decisions as a result of economic pressures, down from 51% last year. Shop­pers that are most likely to have changed their purchasing behavior include: shoppers with a large drop in income (65%); shoppers for larger households (54%); shoppers aged 50 to 64 (50%); warehouse club shoppers (47%), shoppers with below-average income (47%); and shoppers with children (43%). While fewer shoppers are changing their meat purchases, those that do are doing so in a variety of ways. The report states that 78% of shoppers research meat deals before leaving the house by reading flyers more often, up 7% from last year, while 73% buy cheaper cuts of meat. Buying in bulk is a popular solution as well, with 74% of respondents saying they stock up when certain meat cuts are on sale and 71% reporting that they regularly purchase bulk packages. Some shoppers are finding ways to stretch their meat dollar by including meat within pasta dishes and casseroles to reduce the amount of meat needed rather than moving to meatless meals altogether. Very few respondents were willing to frequent cheaper stores to purchase meat, proving the loyalty many consumers have to their primary store for meat purchases. Industry observers say that although loyalty and trust are strong factors when it comes to meat sales, the recession forced some consumers to move away from supermarkets two years ago in favor of warehouse clubs, predominantly be­cause of the ability to buy in bulk. This past year, however, more supermarkets met the demand by offering bulk packages of their own and shoppers returned.  According to the report, supermarkets increased their meat market share from 65% to 68%. While supermarkets and, to a lesser extent warehouse clubs do well with their meat sales, supercenters continue to struggle. Although 32% of respondents say that supercenters are their primary store for grocery purchases, only 19% say they purchase their meat there as well. For shoppers that identify their primary store as supermarket, 88% also make the majority of their meat purchases there. Four percent of supermarket shoppers make meat purchases at warehouse clubs, down from 6%, and 2% make meat purchases at supercenters, down from 3%. Observers say that consumers’ propensity to remain loyal to supermarkets when making their meat purchases is a testament to supermarkets ability to satisfy shoppers changing needs in terms of quality, quantity and price. Conversely, despite that fact that supercenters continue to steal shoppers from supermarkets, only 60% of supercenter shoppers also make meat purchases there. Twenty-nine percent of supercenter shoppers switch to the grocery channel for meat purchases while 5% go to warehouse clubs. Observers say that this provides supermarkets with an excellent opportunity to differentiate themselves with their meat departments. According to the report, chicken and beef continue to dominate consumers’ dinner plates, followed by pork and fish. Eight in 10 families eat beef or chicken for dinner at least once a week, and 33% prepare one or the other three or more times per week. Less than 5% of respondents said they never prepare chicken or beef. While a meat case can help develop strong shopper loyal for a retailer, brand loyal within the meat case is not quite as prevalent. In fact 74% of shoppers have no preference based on brand when purchasing fresh meat or poultry. Observers say that the declining brand preference is likely not so much due to consumers trading over to private label but more likely that shoppers are more interested in finding the best price and value available. Processed meat however is a slightly different story. Only 62% of shoppers “have no preference” when purchasing processed meat, while 10% prefer private label and 29% choose national brands.