The week ending April 12 not only marked an early Easter but also the sixth consecutive week of coronavirus-related grocery shopping patterns.
Since the onset of pandemic in the United States, grocery retailing conditions have been unlike anything ever experienced in history. Unprecedented purchases of pantry, refrigerated and frozen foods by consumers across the United States emptied stores for days and weeks on end, resulting in incredible sales surges and widespread out-of-stocks.
Many stores further sharpened safety measures during the week of April 12, such as metered entry, asking shoppers to limit visits to one person per cart, and encouraging consumers to shop just once a week while avoiding stocking up on any one item.
During these past six weeks, the meat department has emerged as the sales leader of the fresh perimeter and the week of April 12 was no different, when dollar sales increased 43% over the comparable week in 2019 and volume sales increased 36%. This means rather than slowly trending down, sales were actually up week over week as well as year over year. Total perimeter sales were up 18% and food sales, excluding fresh, were up 30%.
While sales were undoubtedly influenced by Easter, celebrations were hardly typical with most Americans under shelter-in-place mandates, which points to a continued higher everyday demand as well. All meat and poultry continued to sell far above typical levels. While small from a dollar perspective, lamb posted the highest percentage gains (108%), followed by turkey (60%). Beef continued to have the highest absolute dollar gains ($188 million). Year to date, dollar gains for total meat are up 20.2% over the comparable period in 2019.
Significant differences are observed when comparing dollar protein shares between the first week of March, when sales were much in line with 2019 and the early part of 2020, and the week ending April 12. While shares are influenced by holidays and differ from week to week, beef’s share is up nearly 2 percentage points as a percentage of fresh meat dollar sales. Turkey gained a full point in share in the six-week period, and pork increased slightly as well. The dollar sales share for chicken was down 3.7 points. Year to date, the patterns are similar, though less pronounced. The same look at volume shows the effect of pricing and the meat industry being out of balance at a macro level in terms of supply and demand.
“There was no chicken,” noted a shopper on the Retail Feedback Group’s Constant Customer Feedback (CCF) program. “I don't know why ... but I like chicken breasts fresh, not frozen.”
Frozen proteins have indeed been reliable backups for many in the past month. To wit: Frozen meat, poultry and seafood sales were up 76.9% over the four weeks ending April 5 vs. the comparable four weeks in 2019, according to IRI. Additionally, some restaurants have pivoted their businesses into grocery stores, while some distributors have been going consumer direct. “We used to eat at Tropical Acres Steakhouse in Fort Lauderdale, Fla., probably every two weeks,” said Yadira Hernandez. “They have turned themselves into a butcher shop. I can purchase a nice New York strip for $9, raw, so it helps me, and it helps them stay afloat. They do all dinner proteins—steak, salmon, chicken—and apparently they’re going through three times more beef than usual. I hope they continue to do this when restaurants open back up.” (Please note that sales generated through foodservice channels is not reflected in these numbers.)
Dollar Sales and Volume sales
Source: IRI, total U.S., multioutlet, percent of total fresh dollars | “All other” not reflected
Sales Growth Drivers
Beef and chicken, the two largest proteins, saw the largest increases in terms of dollars during the week of April 12 vs. the comparable week in 2019. In absolute dollars, beef sold an additional $188 million, with 34% of new dollars being generated by ground beef. Chicken generated $43 million more during this second week of April vs. the same week in 2019.
Ground proteins continue to be popular due to their versatility and ease of preparation. However, ground beef, turkey, chicken and pork all showed some decline vs. the prior week. Purchase limits on ground beef persist for some retailers. Over the week ending April 12 vs. the comparable week in 2019:
- Ground beef increased 35.8%, which was down 7.4% from the week prior, but still highly elevated.
- Ground turkey was up 34.4%.
- Ground chicken was up 28.1%.
- Ground pork was up 38%.
A Detailed Look by Area
Total meat department sales once more exceeded $1.6 billion for the week, with continued gains for all proteins, fresh and processed. The impact of the Easter week can be seen in the types of proteins and cuts sold in fresh, such as lamb, as well as the 179% surge in smoked ham/pork, which came on top of a 245% increase the week prior.
Easter 2020 fell two weeks earlier than in 2019, when it fell on April 21. Processed sales have surged as well since the onset of the coronavirus, with sausage, frankfurters and bacon having generated double- or triple-digit sales increases since the week of March 15.
Sales Gains vs. Comparable 2019 Week
Source: IRI, total U.S., multioutlet, one week percent change vs. year ago
Meat Dollar vs. Volume Gains
Throughout the past five weeks, volume sales growth has trailed dollars, albeit relatively closely for most proteins. For the week ending April 12, beef and pork showed significant gaps in dollar vs. volume growth. Strong beef and pork dollar growth is likely aided by Easter purchases, which prompted more sales going toward premium/more expensive cuts that drive a higher spend per purchase. Turkey and bacon were the only proteins to have higher volume than dollar growth, albeit a mere 2 percentage points.
Dollar and Volume Gains, Latest Four Weeks Ending April 12, 2020
Source: IRI, total U.S., multioutlet
Lessons From Abroad
European sales patterns can help shed some light on what may lie ahead. After very similar weeks of stockpiling as seen in the U.S., most countries seem to have shifted to continued elevated purchasing levels for total edibles, with mixed engagement with fresh. Meat is incorporated in the “fresh” line. For food, the everyday baseline for the week ending April 5 trended between 10% and 20% above the comparable week in 2019 for all countries except France. Nonedible sales have mostly leveled off and declined for some. Frozen food continues to see above-average gains in all countries, but Spain.
Source: IRI, total U.S., multioutlet, week ending April 5, 2020
The third week of April still saw great uncertainty about the “reopening” of the country. While states were encouraged to begin lifting their executive orders in a phased approach under strict criteria when it is safe to do so, many states extended their stay-at-home orders. Only South Dakota remains free of statewide government restrictions that require businesses to close. Other states are a patchwork of shelter-in-place mandates, with expiration dates ranging from the end of April (Indiana and others) to mid-June (Virginia) to indefinitely (California, Maryland, New Jersey and others).
The top question on everyone’s mind is how far the new baseline lies above the old normal. The reality is that it is still too early to tell. There has not been a good indicator week yet of what will be the “new normal.” Mid-March had the enormous panic-purchasing surge, followed by subsequent social distancing and shelter-in-place surges. Next were the two weeks leading up to Easter. In the upcoming two weeks, sales will go up against Easter 2019, which yet again complicates any sense of normalcy and data predictions.
Meanwhile, please thank the entire meat and poultry industry, from farm to store, for all they do to ensure supply during these unprecedented times. #MeatFeedsFamilies #SupermarketSuperHeroes
Anne-Marie Roerink is principal of 210 Analytics, which specializes in research for the food retailing industry and authors studies in meat, produce, bakery, deli, frozen, confectionery, snacks and retail operations. She can be reached at firstname.lastname@example.org.