When a Crisis Passes, Innovation Can't: Lessons From COVID-19

Flexibility and forgiveness were tools of the trade for grocery retailers, and meat departments in particular, as the COVID-19 pandemic ramped up across the country a year ago, The Giant Co. President and CEO Nicholas Bertram said during a leadership roundtable at the Annual Meat Conference this week.

"Flexibility was what made the supply chain as durable as it could have been during that time," said Bertram, who is also a member of the Ahold Delhaize Leadership Community. Going forward, that flexibility will continue to be crucial as retailers seek out and forge connections with new suppliers and build out their e-commerce infrastructure to better meet the needs of shoppers doing more of their grocery buying online, Bertram and other panelists said.

"Never waste a crisis," Bertram urged. As the grocery retail industry struggled last spring to keep meat cases stocked with their usual selections, some smaller and local meat suppliers were able to gain greater shelf space and a wider audience because they were able to step up with available product, Bertram said. Meat counters, too, have adapted to offer a wider variety of products and new value-added selections for consumers who are increasingly willing to explore new-t0-them cuts and proteins. 

"It was interesting to see how customers were willing to expand into different categories and SKUs," said Susan Morris, EVP and chief operations officer of Albertsons Cos. For some customers, that meant trying new private-label meat selections; for others, it meant splurging for premium selections (such as Wagyu beef) because they weren't spending money on restaurant meals. For still others, especially those newer to cooking, it meant experimenting with items such as flank steak or flat-iron steak—and Albertsons stores benefited there, Morris said, from having on-site meat cutters able to get customers what they needed for a particular recipe and offer guidance on protein preparation.

"We saw customers really branching out and trying different things," Morris said. As the pandemic eventually subsides and more businesses reopen more fully, panelists agreed, consumers can be expected to head back to restaurants more—but that doesn't mean they'll drop the new kitchen skills they've honed, meal traditions they've nurtured and shopping behaviors they've adopted.

"I feel customers have built a new relationship with their kitchen and their grill," Morris said. "I hope there's some muscle memory they've built ... [where] customers come back to their kitchen again and again" when they consider how much money they can save by dining in and how accessible meat and seafood dishes can be to prepare, she said. 

"It's fun to cook—I think a new generation has discovered that," Bertram said.

Consumers who helped drive soaring sales for home-improvement stores in 2020 directed some of their purchase dollars to kitchen and patio updates and new cooking appliances, such as smokers, Bertram noted. If grocery retailers continue respond with accessible, cost-conscious ways to consumers make use of their new tools and put creative, craveable meals on the table, they can earn the business-building trust of a new generation of home cooks, panelists indicated.

"Those experiences we had with our families…I don't think we’re going to give those up so quickly," panelist David McDonald, president and COO of OSI Group, said.

Other consumer trends likely to stick around post-pandemic include fewer grocery-store visits, with customers stocking up more when they shop in-store and supplementing in-store purchases with online orders. For retailers and suppliers alike, this emphasizes the need to clearly present accessible, convenient meal solutions for customers whether they’re shopping online or in-store and make it easy for customers to find the information they seek about a product—e.g., through QR codes that consumers can scan to learn more about how a protein product was produced.

"If you think about how people are buying at retail, do you have product formats that allow for that?" offered Jon Nash, corporate VP for Cargill Protein and Salt. "We need to meet them where they are," he said.