PRICES, BARBECUING HEAT MEAT SALES

TONY SPLEEN

Record low beef prices and a boom in home barbecuing are adding up to more sales in the meat department during the slow summer months this year.

Retailers promoting beef, as well as chicken and seafood for the grill, are keeping sales from dipping and, in some cases, are seeing gains, meat department executives told SN.

Some are relying solely on product stickers that indicate which products are good for the grill, while others have gone all out with radio and newspaper ads and special sections devoted to products for the grill.

"Summer is usually a slow time of year for the meat department because people go on vacations and it's so hot that people don't want to cook and heat up their homes," said Arley Morrison, vice president of meats and delis for Minyard Food Stores, Coppell, Texas.

Morrison said promotions have helped boost his summer department sales.

The 80-unit retailer maintains separate cookout sections using eight to 10 feet of triple-deck cases. Ground meats are merchandised in the bottom bay and first shelf, while cut meats and chicken are on the top shelf. Special cookout signs and placards are used to draw attention to the section.

"It's the busiest part of the meat counter," Morrison said.

This year he tried a new merchandising technique in the cookout section. Instead of using white trays for beef, blue for pork and yellow for chicken, Morrison said, he's now putting all cookout items on black trays to set them apart. "The product really jumps out at you," he said.

He's been able to increase beef tonnage almost 20% by featuring traditionally higher priced items in the cookout section, he said. Some recent specials include rib eye and New York strip steaks at $3.98 per pound, T-bone steaks at $2.98, whole brisket at 88 cents per pound and pork spare ribs at 98 cents per pound.

For Garry Marion, meat supervisor for Wade's Foods, Christiansburg, Va., sales are holding steady, and even building, thanks to promotions around the grilling theme as well as consumer interest in cooking outdoors.

Like Morrison, Marion believes in a special section for grill items in the summer. In his six stores, he designates eight to 10 linear feet of four-deck self-service cases for products suitable for the grill, such as tenderloins, rib eyes, ribs and pork chops. He also uses a 10-foot service case entirely for grill items.

One of his strategies is to provide all steaks and filets in extra thick cuts, between 1.25 inches and 1.5 inches, which, he says, are more popular for the grill than thinner cuts.

He also does cross-promotions with produce. In addition to using onions, peppers, mushrooms, tomatoes and beef on skewers, he sells the vegetables packaged separately or alongside the meat for customers to make their own kabobs. "This is a high impulse item,"said Marion. "It's very popular. We don't need to advertise it. We just make them readily available on a daily basis."

Lower beef prices this year have allowed Marion to "promote hotter ad items for cookouts," such as boneless sirloin at $2.99 per pound, New York strip and filet mignon at $4.69 and rib eye at $4.89.

Weekly ad circulars during the summer frequently include a barbecue theme, Marion said. In-store merchandising includes signs and product stickers that read "Great for Grill Outs" or "Excellent for Barbecues." Displays in the grill sections include bags of charcoal and grills as well as other grocery tie-ins, such as sauces.

At Clemens Markets in Kulpsville, Pa., merchandisers use "normal summer merchandising strategies," said Al Kober, buyer-merchandiser of meat and seafood. They also look for new ways to differentiate themselves from the competition.

"Grilling is a very big part of our business in the summer," said Kober. "Most every ad in the summer is geared toward grilling."

Kober said Clemens' 14 stores use product stickers to identify meat cuts that are good for grilling. The company features steaks and kabobs in ads throughout the summer and cross-merchandises separate grilling sections within the meat department with charcoal, spits and sauces.

In the seafood department, a grill is placed inside the case and merchandised with products that are suitable for grilling.

One recent promotion for the grill included a newspaper ad for whole Atlantic salmon at $3.99 a pound. The ad included a recipe and tips for grilling salmon in foil on the grill. "It helped bring additional sales to the seafood department," Kober said. "Each store sold about 100 fish."

Another popular item promoted for the grill is a new in-house marinated chicken. Now in five stores, the program uses a machine that tumbles chicken with a marinade for 15 minutes. He said it works better than simply soaking chicken in a marinade because the "marinade really gets into the meat. It really improves the tenderness, taste and juiciness."

The product is merchandised on an overwrapped black microwavable plastic tray. Four flavors are used: honey mustard, natural, lemon-pepper and Cajun.

"It's part of our Quick Cuisine program, but we're also promoting it as a grilling item," Kober said.

Not all retailers favor separate displays or cross-merchandising programs, at least according to those contacted by SN.

"I've worked for other companies that have a separate grilling section, but since coming here I've learned it's not really necessary," said Phil Perrault, assistant meat department manager for Byerly's, Edina, Minn. "Our customers are typically looking for a specific item and they're going to find them without going to a special section."

That's not to say that Byerly's doesn't promote products for the grill.

"All you hear is, 'grill, grill, grill,' " said Perrault. "Customers keep saying 'we want something for the grill.' You've got to go with the flow."

Byerly's, which operates nine stores around Minneapolis, doesn't use ads or in-store signs or danglers for grill items, just special stickers to indicate which meat items are good for the grill. The company does have in-store specials for the summer, with recent features including sockeye salmon for $4.99 per pound and New York strip steaks at $9.99 per pound, down from the regular price of $12.99.

Perrault said that consumers' interest in grilling -- not more promotions around grilling -- will drive increased sales in the meat department. "We're doing better than we did last year," he said. Other retailers agreed.

"A cow is a cow whether or not you cook it indoors or outdoors," said Dave Young, director of meat merchandising for Marsh Supermarkets, Indianapolis. "We don't do massive outdoor [grilling] displays."

Young said that he does do some merchandising in the company's 86 stores around the grilling theme, "but I don't do it in an extra-special manner."

Consumers are increasingly interested in grilling, and their interest has little to do with promotions, he said. "People like the taste, and they like to cook outdoors," he said.

He incorporates some cross-promotions in his displays and uses product stickers to identify items that are good for the grill. "But I'm not sure of their worth," he said. "I don't think promotions [like these] do anything to move more product. We can put charcoal out in front of our case for people to trip over and all the other items that go with it. It does nothing more than what you'd do the rest of the year."

A meat director from a northern California supermarket chain who asked not to be identified said he does nothing more than use product stickers. "Some consumers need to know which cuts work on the grill, but other than that they don't need anything else. We don't go to the trouble of putting up displays. The cost is greater than the return. Our sales are strong without all of the hoopla."

Verland Lamke, director of meat operations for Homeland Stores in Oklahoma City, said outdoor cooking continues to grow in popularity in the region. His company operates 112 supermarkets in northern Texas, Oklahoma and southern Kansas. "Still, I have a strong feeling toward not having a separate section [for grilling items]," he said. "I think it's best to integrate those items into regular displays. You get better shopping of the whole display case rather than trying to attract customers to one section."

Lamke said he believes in promoting the grilling theme, but he likes to add money savings value to make the promotions more appealing to consumers. He is currently involved in an eight-week promotion with the Beef Industry Council and Lea & Perrins, maker of several steak sauces. The promotion includes an in-store coupon attached to steaks for $1.10 off with the purchase of a bottle of sauce. Underneath the pull-off coupons are recipes, many of which are for the grill.

The promotion involves demos and samplings in 30 of Homeland's stores as well as radio ads that announce the coupon offer. During the promotion, which ends Labor Day, Homeland is featuring a different beef item weekly. In August, several ads will incorporate the cookout theme.

How have sales been affected by the program? "Because of the lower-than-normal beef prices right now, it's hard to tell," Lamke said. "We have low-price beef features and we're seeing good results. We're getting good tonnage."

Because beef prices are so low, more promotions using the grilling and cookout theme can be expected industrywide in the weeks ahead, according to John Story, director of meat and deli operations for Holiday Cos., Minneapolis, a wholesaler serving 600 supermarkets in the upper Midwest.

"I anticipate more promotional activity around grilling because prices are so attractive," he said. "When you've got increased value, you can do more with promotions."

But lower prices are a double-edged sword for some. "Last quarter [April-June] was the highest record sales quarter ever," said Clemens' Kober. "But not the highest in profitability. With lower prices tonnage needs to really be up to maintain volume."

Marion of Wade's Foods concurred. "Lower prices are helping on tonnage but hurting on dollars," he said. "We're ringing up more items but less dollars. We have to move even more product to keep up."