Ground Beef is Sizzlin’!
By Richard Mitchell
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This is a “hot” time of year for ground beef merchandisers. The summer grilling season triggers a strong demand for grinds, which already account for approximately 33 percent of dollar and 40 percent of beef’s pound sales.
Ground beef is attractive to shoppers because it is among the most affordable and convenient beef products, and can be used in many dishes—including hamburgers, Sloppy Joes, and tacos—as either an entrée or ingredient. Yet, its popularity does not alleviate the need for beef producers and retailers to continue to market ground beef to consumers, analysts say. Rising prices and the strong merchandising of other proteins, such as pork, threaten to limit category growth, they note.
“It is important to promote the best-selling items, and ground beef always has been the most dominant beef product,” says Randy Irion, director of retail for the Centennial, CO-based National Cattlemen’s Beef Association (NCBA). “But along with this dominance comes the risk of complacency, which is why we’re always reviewing our marketing strategies.”
Summer grilling program
Among the NCBA’s merchandising vehicles is its summer grilling promotion which began May 1 and will run through Labor Day. Two ground beef ads are among the six radio commercials the association is airing in the top-45 markets.
A generic message publicizing beef is delivered in the first half of the 60-second spots, with the remaining time devoted to promotions from specific retailers. The NCBA is subsidizing the ads, which feature the voice of actor Sam Elliott.
In one commercial, Elliott says: “It happens every summer. A burger falls through the grill. Prematurely taken from our barbecues by the fire gods. And over the sound of the fallen sizzling beef, you can hear a man’s tragic groan. ‘Why didn’t you take the chicken? Or the grouper?’ But you can’t blame the gods for having taste. Beef. It’s What’s For Dinner.”
NCBA also is working to generate editorial coverage by distributing more than a dozen burger recipes to newspapers and consumer magazines. In addition, the association teamed with Northfield, IL-based Kraft Foods, makers of A.1 Steak Sauce, to create a beef grilling guide that includes a recipe for “Texas-Style Burgers.” The guide will appear in nearly 1 million copies of Midwest Living magazine and in more than 2 million issues of Kraft Food and Family magazine. Guides also will be distributed at A.1. supermarket displays.Building the perfect burger
In another initiative, Sutter Home Winery Inc., St. Helena, CA, is sponsoring its 15th annual “Build a Better Burger” contest with cash prizes totaling $64,000, and the winner receiving $50,000. Participants have until August 26 to submit burger recipes. Ten finalists will be picked to compete in the National Cook-Off in Napa Valley, CA, on Oct. 1. Event materials contain the NCBA’s “Beef…It’s What’s For Dinner” logo.
Another contest that includes ground beef recipes—The National Beef Cook-off—is being promoted by the American National CattleWomen Inc. and Boise-based Albertsons Inc. Twenty finalists will compete in Rapid City, SD, in September for nine cash prizes totaling $110,000.
Such national promotions are being augmented by in-store initiatives from meat suppliers and retailers that include the distribution of recipes cards and product information to consumers, point-of-sale signage, and cooking demonstrations and samplings.
Many merchants, including Pittsburgh-based Giant Eagle Inc.—which offers more than a dozen varieties of ground beef—aggressively merchandise products via weekly advertising circulars and store displays. Ground beef is the top-selling fresh meat at the 219 Giant Eagle stores in western Pennsylvania, Ohio, West Virginia, and Maryland.
“Ground beef crosses every racial and ethnic profile, and cultural preference,” says Al Kober, director, retail, for Wooster, OH-based Certified Angus Beef LLC. “But marketing strategies should vary based on the demographic group being targeted.” Some retailers in upscale areas already emphasize the leanest and more-expensive items, while stores in less-affluent neighborhoods often publicize lower-cost ground beef.
It is prudent, however, for merchants in all locations to emphasize the products’ freshness by grinding beef in view of shoppers, Kober says.
Samplings also are an effective way to promote ground beef, but the lower-fat items usually are poor demo candidates, he notes.
“The majority of people eat a hamburger for taste, and they can tell the difference between the various types,” Kober adds. “Leaner beef should just be put placed on a tray with a label listing its attributes.”
Fresh Brands Inc., a Sheboygan, WI-based operator and franchiser of about 100 Piggly Wiggly and Dick’s Supermarkets stores in Wisconsin, Illinois, and Iowa, leverages a variety of merchandising techniques that include advertising its leaner Certified Angus Beef-branded products and grinding ground beef in stores several times daily. The retailer prints the time the ground beef was packaged on each label.
“There is no substitute for freshness when it comes to grinds, especially because many customers are willing to pay more for better products,” says Joseph K. White, Fresh Brands director of meat and seafood.
The retailer creates large displays for its advertised items and frequently will enhance revenues by situating other discounted ground beef next to the featured products. If ground chuck is being sold for $1.99 a pound instead of the usual $2.99, for instance, the merchant might run an in-store promotion at the same time for ground chuck patties that it sells for $2.19 or $2.29.
White notes that ground beef sales typically increase between 50 and 100 percent when the items are prepared and sampled in-store. The largest obstacle to staging demos is locating personnel who can accurately explain the meats’ attributes to consumers, he says.
“Demonstrations are important because many people are not going to take a chance on buying a newer item without first tasting it,” White adds. “Cooking burgers within a location appeals to their senses.”
In addition to such promotions, demand for ground beef also is being spurred by the relatively low cost of grinds compared to other beef products. The average price for 80-percent lean ground beef is about $2.50 a pound, while consumers can pay more than $12 for a 12-ounce rib-eye steak, says Mike Hesse, sales manager at Beef Products Inc. (BPI), a Dakota Dunes, SD-based provider of lean beef trimmings.
Yet, because ground beef still is often more expensive than other proteins, such as chicken, the incentive remains for suppliers and merchants to actively merchandise the products, Hesse notes. Prices for all beef cuts have risen 30 to 50 percent over the last several years because of such factors as low domestic cattle supplies and the inability of producers to import Canadian beef because of bovine spongiform encephalopathy (BSE) concerns.
“Advertising more than anything will drive ground beef purchases,” Hesse adds. “Forty to sixty percent of the product is sold because of ads. If it is not marketed properly, ground beef sales will likely be lower than the proteins that are part of promotions.” NP
Richard Mitchell is editor of sister publication Meat & Deli Retailer magazine.