Consumers are dealing with rising food prices by buying less beef and pork and shifting to more economical cuts of chicken, Steve Lutz of The Perishables Group said at the Chicken Marketing Seminar in Squaw Valley, California, this week. Meat and poultry with the “organic” label is holding its own despite high prices, he added.
Steve Lutz of The Perishables Group speaking at Chicken Marketing Seminar 2011.
Lutz reported findings from The Perishables Group’s FreshFacts® Point-of Sale-Data , which includes all products sold in the fresh departments of 13,000 grocery stores nationwide.
Consumers are under stress from the recession, rising prices, and the cost of motor fuel, which consumes 16 to 18 percent of weekly consumer retail spending, he said. Shoppers are saving money by making fewer trips to the store and buying less in each trip. Sales volume of beef and pork are being hurt by rising prices, while chicken buyers are shifting slightly from breasts and whole chicken to wings and thighs.
Ground chicken is growing, Lutz said, with a 7.4-percent increase in sales volume and a dollar increase of 11.8 percent. Rotisserie and other value-added chicken items are enjoying good growth, he said.
“Consumers believe in the benefits of organic and natural,” he said. “Shoppers are unwilling to give up the choice, even if they only purchase organic for certain cuts of meat.” Organics make up less than one percent of fresh retail sales, but the volume of organic meat and poultry products increased 12 percent in 2010, he said.
Chicken was the only protein with a substantial organic presence (2.4 percent), up 20.2 percent from a year ago, he said. Organic beef, chicken, pork, and turkey all increased dollar sales in 2010, Lutz said.
“The economy has also been a real proving ground for organic and natural meat,” Lutz said. “While the category did not experience significant growth, it did not decline either. With strong belief in the positive long-term health effects of organic meat and poultry, shoppers are unwilling to give up this choice. With 31 percent purchasing natural and organic meat and poultry when it is on sale, promotions could help grow usage among current users as well as attract new shoppers to the category who are currently discouraged by the premium price point.”
