Can beef maintain its supermarket sales momentum?

In this boom time for beef, the large base of consumers preparing more meals at home during the COVID-19 pandemic is boosting sales of all varieties of cuts ranging from premium steaks to value-oriented ground beef.

Beef loin dollar sales, for instance, were up by $589 million with 29 million more pounds sold from January through June 27, 2021, versus the same period in 2019 prior to the pandemic, reports Information Resources Inc. (IRI), a Chicago-based market research firm. Ground beef dollar and pound sales grew by $554 million and 26 million, respectively.

Indeed, while sales of all beef cuts were up during the pandemic, steak purchasing was particularly strong “as consumers had more dollars in their pockets, were not eating at foodservice establishments and seemed to want to actually pay slightly more for an expensive cut, such as steak,” said Jace Thurman, market intelligence analyst for the Centennial, Colo.-based National Cattlemen’s Beef Association (NCBA).

The shopper move to high-end steaks, meanwhile, “has staying power,” said Anne-Marie Roerink, principal of 210 Analytics LLC, a San Antonio-based market research and marketing strategies firm and preparer of the Power of Meat 2021 report. “People still want to treat themselves with a nice steak and that occasion moved from the restaurant to the home,” she said. “The year-and-a-half of home-centric meat spending will have driven home the message that it is much more cost-effective to prepare steaks at home.”

Steak’s share of beef sales volume grew 1.4% to 24.9% from 2019 to 2020, the NCBA reports, while ground beef had a 1.5% volume share decrease to 50.2%.

“Customer demand for quality continues to grow,” said Mark Salerno, meat merchandiser/operations supervisor for Keasbey, N.J.-based Wakefern Food Corp. He noted that the company’s banners, such as ShopRite, are emphasizing higher-end beef cuts and spotlight Certified Angus Beef on its circular covers next to a choice beef selection.

“We still have to give our customers a low-price item, but we want them to trade up,” he said. “We try to show them through social media and advertising that they can get quality beef at ShopRite that they can’t get at other stores.”

Restaurant-quality cuts

ShopRite/Certified Angus Beef

While ground beef still is the most popular beef selection because of its versatility and lower cost, steaks that duplicate the restaurant experience, including the ribeye and striploin, are most popular with less price-sensitive shoppers, said Todd Allen, director of meat and seafood at West Sacramento, Calif.-based Raley’s. Raley’s operates 126 supermarkets in Northern California and Nevada.

The retailer spotlights its beef options by offering best-in-class selections of packaged cuts in a wide variety of sizes and thicknesses, while also applying seasonings and marinades for free and offering custom cutting upon request, Allen said.

ShopRite is among the retailers highlighting higher-end beef cuts to attract quality-minded consumers.

The current higher-than-usual beef prices, which are resulting in fewer promotions that would normally help drive extra sales, are the main merchandising challenge, he said. “Consumers in some cases are trading down into more affordable beef cuts or to a different protein, like pork or chicken,” Allen noted.

Supermarkets also will face more sales pressure as additional restaurants reopen. Overall beef volume sales shifted about 7% from foodservice to retail during the pandemic but will likely revert to the normal 60%/40% foodservice/retail split, Thurman said. “But for 2021, we expect retail to remain somewhat elevated versus normal years,” he said.

Providing meal suggestions

“As customers continue returning to normal activities, they’re going out to dinner more but at rates still lower than before the pandemic,” noted David O’Diam, vice president of retail for the Wooster, Ohio-based Certified Angus Beef brand.

He said retailers need to provide meal suggestions, cooking tips and value-added options to help sustain interest in beef recipes among the many consumers who began preparing meats at home during the pandemic. “Digital social conversations get them into the store,” O’Diam said. “Once in the store, the key is giving them meal ideas from the deli to the meat case.”

Indeed, it is paramount that operators also leverage digital strategies in order to successfully promote beef, said Bridget Wasser, NCBA senior executive director, product quality and education. “Tactics like digital circulars and loyalty emails with both beef features and inspiration, such as recipe ideas and videos, are critical and effective in sustaining beef sales growth,” she said. In addition, it is important for retailers to continue featuring beef during such opportune times as the summer grilling and tailgating seasons and during the holidays, Wasser added.

The steeper beef prices, however, are causing many retailers to eliminate prices from ads and simply remind consumers that they offer attractive cuts, including filets, ribeyes and porterhouses, Roerink said.

ShopRite, meanwhile, is emphasizing its in-store cutting and uses podcasts to educate butchers on how to effectively cut and merchandise primals, Salerno said.

PCC Community Markets, a Seattle-based food co-op with 15 locations, is showcasing its beef options with cooking classes and by merchandising value-added selections that feature flavorful marinades, rubs and even blueberry salsa, said David Sanz, PCC meat and seafood merchandiser.

“These products help take some of the guesswork out of what to cook and are great time-savers,” he said.

Restrictions on staging demos and samplings in stores because of COVID-19, however, are making it more difficult to introduce products to shoppers, Sanz said, adding that PCC is working to attract attention to its beef by spotlighting locally developed and organic grass-fed options and staging year-round promotions.