Stacking The Odds
The deli-meat category aims to please with more products, packages and sales opportunities.
For some, change is a slow, evolutionary process. For others, it is more of a rapid-fire shift.
The deli-meat category has been undergoing more of the latter type of change. After decades of providing traditional flavors and forms like logs and rolls, the segment started to go gangbusters in the 1990s, with the advent of pre-sliced, pre-packaged products, ultra-thin and shaved portions and more flavored and seasoned meats, and has stayed on a fast-moving course.
Today, more convenience-oriented and flavored products continue to enter the marketplace. According to Jim Schloss, corporate vice president, sales and marketing for Smithfield Foods, Smithfield, Va., companies are wise to keep tabs on consumers’ ever-changing palates when it comes to deli meats. “You still have logs, rolls and loaves, but deli is becoming an aggressive area,” he says, noting that Smithfield has about a dozen flavors for many of its deli proteins, as consumers look for intense flavors, such as meats with a strong smoked taste. Smithfield’s John Morrell division, for instance, introduced new Kretschmar Smoked Ham Off the Bone deli meats last spring.
Consumer preference for thinly-sliced luncheon meats also has not abated. As most major deli-meat brands now offer shaved prepackaged deli meats, many of which are sold in resealable tubs and packages, there continues to be R&D work in this area. This year, Hatfield Quality Meats developed a new Deli Thin Sliced Lunch Meat line including oven roasted turkey varieties, while Homewood, Ill.-based Carl Buddig & Co. added to its venerable brand a line of Original Deli Thin Meats in beef, ham, and corned beef varieties.
The move toward more natural meat and poultry products, evident across all protein categories, is particularly noteworthy in the deli-meat category. There has been a cascade of new natural (deemed minimally processed) deli meats that have entered the marketplace in the past year alone.
One of the biggest launches in this niche came from Hormel Foods Corp. The company’s all-natural, preservative-free Natural Choice® Deli Sandwich Meats are available sliced to order from the deli counter or packaged in a paperboard outer box to convey the naturalness of the product inside. Varieties include cooked, honey and smoked ham and turkey products.
Several other deli-meat processors have gone au natural, so to speak, as well. Hormel’s Jennie-O Turkey Store, Inc. division announced its own version of Natural Choice® Deli Meats for the service deli case. Coleman Natural Foods of Golden, Colo., also has come out with All Natural Deli meats in several turkey and chicken varieties, all made without the use of antibiotics, preservatives, artificial ingredients, added hormones, artificial color or added nitrates or nitrites. Carolina Turkeys opted to include deli offerings in its new roster of Just Perfect natural turkey products, including varieties like Sun Dried Tomato and Summer Herb and Garlic. Again, the products are free of artificial ingredients, phosphates and nitrites.
As for foodservice, the sandwich and wrap category remain strong and pose great opportunities for deli meats. According to the National Restaurant Association, 63 percent of quick- service operators report increases in deli-style sandwiches over a year ago, second only to those who answered chicken sandwiches. NP
Top 10 Refrigerated Sliced Lunchmeat Brands*
  Dollar Sales ($ millions) Dollar Sales % Change Prior Year Dollar Share Unit Sales (millions) Unit Sales % Change Prior Year
1. Oscar Mayer 910.4 7.2 29.2 342.5 3.7
2. Private Label 480.9 4.0 15.4 223.9 -3.9
3. Hillshire Farm Deli Select 280.7 4.4 9.0 91.6 4.0
4. Buddig 135.7 2.9 4.3 95.6 -3.5
5. Butterball 93.4 -15.3 3.0 33.8 -25.5
6. Bar S 84.0 11.1 2.7 45.3 7.9
7. Land O Frost Premium 79.1 -2.0 2.5 20.4 -1.2
8. Louis Rich 70.5 -6.8 2.3 29.3 -6.8
9. Land O Frost 46.3 8.3 1.5 25.6 -6.9
10. Gallo Salame 45.8 -0.5 1.5 10.4 -5.3
Total Category 3,122.5 0.1 100 1,285.7 -3.5
*Total U.S. -F/D/MX (supermarkets, drug stores, and mass merchandisers (excluding Wal-Mart) for the 52 weeks ending July 16, 2006.
Source: Information Resources Inc.