Disrupting Routine in the Meat Industry

Transparency, convenience and digital disruption were among the key topics discussed at the recent 2018 Annual Meat Conference (AMC) in Nashville, which attracted more than 100 suppliers and 200 retailers to explore the industry’s latest innovations and trends, with creative, natural and customized products dominating conversations.

The conference, co-hosted by the Food Marketing Institute (FMI) and the North American Meat Institute, featured an abundance of educational exhibits—from insightful presentations by top industry experts to meat suppliers’ virtual farm-to-fork storytelling experiences—arming attendees with information, inspiration and innovation to combat the industry’s growing threats of demographic and societal changes, advancing technology and, of course, Amazon. The speaker lineup included Anne-Marie Roerink, principal at 210 Analytics LLC; Neil Stern, senior partner at McMillanDoolittle LLP; Jill Tomeny, senior manager of fresh category solutions for Daymon Worldwide; Alisa Harrison, SVP of global marketing and research for the National Cattlemen’s Beef Association; and David Fikes, VP of communications and consumer/community affairs for FMI.  

Among the most anticipated presentations was the general session keynote by Roerink, who shared insights into the 13th installment of The Power of Meat 2018: An In-Depth Look at Meat Through the Shoppers’ Eyes. Based on surveys from 1,500 shoppers, the study revealed the necessity of a change in routine for consumers, retailers and suppliers alike. As shoppers’ meat-purchasing decisions are increasingly influenced by overarching grocery trends, including health and wellness, convenience and transparency, Roerink said the industry must experiment with innovative and interactive ways to expose consumers to fresh products and educational resources to disrupt shoppers’ routine meat purchasing habits.

With the internet accessible from most consumers’ fingertips, information is more available than ever—yet shoppers’ overall meat knowledge is still lacking, as evidenced by a whopping 83% of shoppers who purchase a mere handful of standby meat cuts and varieties, according to the Power of Meat report. However, 42% say they would branch out with additional educational tools and exposure. The more meat knowledge consumers have, the greater the variety of meats they purchase, which ultimately leads to greater store loyalty, spending and trips, according to Roerink. To that end, retailers and suppliers have a prime opportunity to drive demand and sales by teaming up to enhance shoppers’ meat knowledge through various platforms.

While more than 50% of shoppers reported having limited knowledge of meat and poultry, “The research demonstrates that shoppers who are more knowledgeable about meat tend to purchase an extensive variety of meats and cook with meat more often,” FMI’s VP of Fresh Foods Rick Stein said when the report was released. Shoppers crave informative tools and resources to increase their knowledge of meat and poultry products and cooking methods.

McMillanDoolittle’s Stern shared a telling statistic during this keynote: In 2018, consumers are expected to spend an average of three hours and 23 minutes on their mobile devices per day, per data from ComScore. With this in mind, NAMI recently unveiled a new digital Product Center designed to assist consumers and health professionals seeking products that fit specific nutrition profiles, such as low fat, reduced sodium, natural and organic, or American Heart Association certified. The resource catalogues more than 1,500 products in 12 prepared meat categories.

Nutrition information remains a top concern for meat consumers, as seven in 10 shoppers are interested in a variety of package sizes for portion control as well as dietary callouts, led by protein content, total fat and sodium, according to the Power of Meat report. “Meat and poultry companies have responded to the demand for more information about their products, offering a range of options including natural, organic, hormone-free and antibiotic-free, which have proven popular with consumers,” said NAMI President and CEO Barry Carpenter. “The industry has also developed numerous resources to help educate consumers about how our products are made, from our Glass Walls videos to Meat MythCrushers to the MyMeatUp app developed to help shoppers navigate the meat department.”

“It was very clear at the Meat Conference this year that our industry is preparing for … a shift to digital,” says Kent Harrison, VP of marketing and premium programs at Tyson Fresh Meats. He says 47% of consumers are utilizing digital resources to educate themselves about cuts of meat—“Though there is still something to be said about face-to-face consumer interaction.”

Digital resources offer an effective way for retailers and meat brands to expand their reach, but consumers still desire in-store butchers and meat experts to offer product selections and recipe recommendations with a personal touch. “The biggest advantage retailers have is knowledgeable and friendly staff that can engage consumers. This is mission critical to provide a real and meaningful difference,” says Stern. Delivering the kind of customer service the internet cannot match is an essential competitive advantage retailers must act on, as 38% of shoppers would value a customer service associate in the meat case to offer tips and serving suggestions, according to the report, and 70% of shoppers still value a full-service meat counter.

Retailers and suppliers must work together to maximize fresh meat sales goals. “We work with our retail partners to ensure they have all the resources they need,” says Harrison. “The Tyson Fresh Meats Beef & Pork Experts have the knowledge and experience to advise our partners on consumer trends and which products to push or promote.”

Offering digital and in-store educational resources is one way retailers and suppliers are satisfying the rising consumer demand for not only education, but also product and brand transparency. According to the Power of Meat report, consumers want to know about sourcing, animal welfare and environmental practices, as products with special attributes saw dollar gains of 4.8% over 2017, compared with a flat year for conventional products.

In today’s grocery landscape, where consumer habits are evolving and product offerings are seemingly endless, retailers must pick key areas where they can differentiate, Stern says, or risk getting left behind. “Make your own story,” Stern told AMC attendees during his general session, Maintaining Relevancy: Retail Trends Impacting Today’s World and Beyond. “Make it work for you and your company. That’s how we’re going to be relevant in the future.”

Meat shoppers’ preference for manufacturer brands has reached a 12-year high, with 63% of shoppers leaning toward familiar brands, according to the report. Consumers also see brands as offering better quality, value and consistency. By capitalizing on consumers’ brand loyalty, retailers have the opportunity to build store loyalty by consistently offering those preferred brands for their shoppers.

Suppliers, such as Cargill, are tapping into digital resources and interactive experiences to offer a deeper look into their brand’s stories. With a Protein Powered by Insights theme, Cargill’s AMC booth featured a 360-degree video experience that transported its visitors to every step of the supply chain—from a cattle ranch and chicken farm to its culinary center and packaging facility—providing a transparent look at the brand’s story and innovations.

Cargill has spent the past two years transforming its business “to deliver protein powered by insights” to help its customers get ahead of emerging trends, says Chuck Gitkin, chief marketing officer for Cargill Protein, whose efforts centered on providing greater variety, new flavors and increased farm-to-fork transparency.

The Beef Checkoff and the National Pork Board also both utilized digital resources to share their behind-the-scenes production stories. The Beef Checkoff highlighted its digital relaunch of the iconic “Beef. It’s What’s For Dinner” brand, and the Pork Board featured a live video tour of a hog operation, offering an interactive way for consumers to connect with farmers and ranchers.

Convenience has long been a driver of growth and product innovation throughout the store perimeter, and the meat department is no exception. Shoppers are increasingly integrating convenience-focused solutions in their meal planning, and increases in consumption frequency and household penetration drove gains in heat-and-eat, ready-to-eat and value-added meat over the last year, according to the Power of Meat report.

“Consumers are looking for products that make it easier for them to put a meal on the table,” says Stern. “Value-added products that can be quickly cooked and meal kits that provide convenience and variety are examples of products that can help consumers and provide growth for the retailer.”

Once exclusive to innovative startup companies, meal kits have become an essential offering in retailers’ meat departments. In the year ended 2017, in-store meal kits generated $154.6 million in sales, posting growth of more than 26% year over year, according to Nielsen. What’s more, 9% of U.S. consumers say they’ve purchased a meal kit in the last six months, and 25% of consumers say they would consider trying a meal kit in the next six months, per Nielsen data.

Retailers can tap into this growth, driven by Gen X consumers, by offering meal kits with new ingredients and cooking techniques, which help break shoppers’ routine cooking habits and offer new tastes and experiences.

Meal kits certainly offer a quick meal solution, but digital still dominates in terms of convenience. “Allowing customers to preorder products, using technology for recipe development and providing ease of ordering are examples of where technology can advance convenience within the meat department,” says Stern.

E-commerce has long been a challenge for the meat industry to capitalize on, but consumers’ willingness to order meat online is growing. While online meat purchases still lag grocery e-commerce, supermarkets still rank as the lead channel for meat purchases, according to the Power of Meat report, which found that 19% of consumers have ordered meat online at least once, up from 4% in 2015, and others are willing to do so, particularly when fulfilled by their primary meat store. Plus, more shoppers (21%) are frequently purchasing value-added meat and poultry, up from just 9% in 2016.