By Brian Diffenderfer
Brian Diffenderfer, director of meat and seafood for Daymon Worldwide, says beef and pork shortages will affect retailers summertime ad plans.
Summertime grilling is a favorite American pastime, rich with family celebrations and sacred recipes for cooking up delicious barbecue meals passed down through the generations. While grill aficionados argue the benefits of gas versus charcoal and just when to add the secret sauce, the bigger issue this year may be how to get your hands on your favorite fare.
With U.S. cattle inventories lower than they have been in 30 years and retailers scrambling for product, demand for beef is at an all-time high. Retailers trying to repeat front page beef ads from the previous year will have some tough decisions to make. In many cases, they will be forced to look for alternative items that can drive sales in their ads.
Current limited pork availability, thanks to the Porcine Epidemic Diarrhea Virus (PED), is having a major effect on pig farmers. Experts predict the PED virus will kill 3% of all the piglets raised in the U.S. this year. Considering skyrocketing beef prices, this could not happen at a worse time as now pork prices are also climbing to record levels.
With beef and pork prices so high what will retailers advertise on the front page of their ads this summer? They cannot run poultry on the front page every week and seafood does not generate the sales needed for a front page ad block. Retailers will have to be creative in how they repeat the ads from last year to balance the new higher retail prices, and hope their competition will do the same. Focusing on seasonal favorites like porterhouse, strips and rib steaks will also help entice price-conscious consumers into accepting a higher price for a seasonal treat that can be substituted.
We will see growth in better-for-you store brand products like turkey burgers, gourmet chicken sausage and turkey franks. Store-made beef, pork and chicken kabobs with or without vegetables are always a great option for ad front covers. Gourmet store-made burgers are another great ad item and can help set retailers apart from their competition.
If a retailer has no choice but to offer steaks in their advertising, despite the higher prices, it makes sense to offer differentiators like select grades of beef or Australian grass-fed beef. Grass-fed beef is a leaner cut of meat, and an excellent better-for-you option, boasting positive year-over-year growth.
The cattle shortage and the PED virus will have the biggest impact on traditional high-low retailers. Since nothing drives consumers into stores like ads for good grilling steak around the summer holidays, these retailers can consider using them as a lost lead item on the front page of ads to pull consumers in-store. Ground beef, pork chops and spareribs are also used on the front page to drive foot traffic into the stores. Many retailers will likely be forced to put porterhouse, strips and rib eye steaks on the front page of their ads with retails as high as $8.99 a pound.
We may also see more retailers using a “buy this and get that free” approach that offers free side items or meal pairings when a particular protein is purchased. Another way to create separation from competition is to advertise value-added marinated steaks, spareribs and chops.
While raising retail prices on pork spareribs, pork chops, beef and ground beef may be unavoidable, retailers should not douse the burners just yet. By creatively positioning attractive alternate proteins and complimentary meal accompaniments, retailers can help take the burn out of the bigger spend required this season and still inspire consumers to fire up their grills.
Brian Diffenderfer is director of meat and seafood for Daymon Worldwide. He can be reached at firstname.lastname@example.org.