As the recession wears on, shoppers are still hunting for bargains, but one recent survey, focused on shopping habits in the meat department, indicates that consumers have adjusted and have become more comfortable with their household economic situations. Also, retail dollar sales for the total meat category have continued to rise through much of the recession, even as retailers cut prices.
The results of “An In-Depth Look at Meat Through the Shopper's Eyes” will be presented by Midan Marketing, Chicago, and Shugoll Research, Bethesda, Md., at the 2009 World Wide Food Expo this week in Chicago.
The study is a followup for a similar study completed in January, using a demographically representative sample of 500 U.S. adults. Shugoll and Midan shared with SN a few key comparative results from the followup study.
Notably, in the January survey, about one-third of respondents said their shopping habits had not changed as a result of the recession. In the more recent survey, conducted in September 2009, researchers found that the number of people who claim their shopping habits have not changed appears to be rising. Shugoll takes this as a sign that shoppers feel that their household situation is stabilizing.
“Throughout all of our questions, we've seen similar findings,” she said. “People seem to be feeling less stress. It hasn't completely gone away, but people seem to have figured out a way to make the changes they need to make to be comfortable, and they don't seem to be having to take greater steps in order to economize as a result of the economic downturn.”
Some things haven't changed. Forty-seven percent of shoppers said they were using more coupons in January, and 47% made the same statement in September. Yet while 47% of January respondents said they were preparing more meals from scratch, in lieu of purchasing convenience foods or value-added products, only 42% agreed with that statement in September. Similarly, 58% of shoppers said they were eating out less often in January, while 53% agreed with that statement in September. And, 60% of shoppers said they were shopping for bargains more often in January, compared with 56% in September.
“These are not statistically significant differences,” Shugoll cautioned. However, she said it was interesting that several cautionary indicators were falling at a similar rate.
“In looking at the data from a trending point of view, people are feeling more comfortable about things. … That's a really good thing for the retailer,” she said.
A sales-data component of the study indicated similar trends.
“We saw sales continue to increase for all of the proteins that we were tracking,” said Michael Uetz, principal of Midan Marketing, Chicago.
In the two fiscal quarters following the January survey, total meat and poultry sales rose — by 4.7% in Q1, and by 7.5% in Q2, compared with the same period in 2008.
“Even as the recession progressed, we still saw strength in the numbers,” he noted. “It shows that consumers really do look toward fresh meats as a core part of their meal preparation plan. Even in the recession they've been finding value, finding products that really fit their needs.”
Of course, prices for meat and poultry have been falling for most of the year. With so many shoppers cutting back on restaurant visits, demand from the foodservice sector plummeted, creating lots of additional supply and putting lots of downward pressure on wholesale prices. Shoppers may be feeling more confident because they've been able to find a lot of great deals on everything from whole chickens to steaks.
A spot-check survey of store circulars conducted by SN last week found a Kroger location in Dearborn, Mich., offering strip steaks at $4.97 per pound; a Ralphs in Anaheim, Calif., offering ribeye steaks at $6.99 per pound, and chuck and rump roasts both at $2.99 per pound. A Schnuck's location in St. Louis offered bottom round roasts at $2.99 per pound, and Certified Angus boneless sirloins at $3.29 per pound. And, a Publix in Clearwater, Fla., was offering bottom round roasts at $1.99 per pound, and T-bone, porterhouse and top-sirloin steaks at $6.99 per pound.
As a result of deals like these, retail volumes sales have continued to rise, even as prices continue to decline. Randy Irion, director of channel marketing for the National Cattlemen's Beef Association said that the result has still been a net positive for retailers.
“In the month of August, loin pound sales were up 14% from where they were a year ago,” said Irion. “We had a 30% increase in pound sales for the rib. That was with an almost 9% decline in the average price for loin [cuts] and a 13% decline in the average price per rib.”
Despite those steep price cuts, when compared with sales from a year ago, average dollar sales for loin cuts were up 4% in August, while dollar sales for rib cuts were up more than 12.5%, Irion said.
“We are very pleased with how retailers have capitalized on the opportunity in front of them, and promoted beef very aggressively,” he said. “They've seen the fruits of that with increased dollar and pound sales.”
But, shoppers have also continued to look for bargains through traditionally less expensive items like bone-in chicken breasts and bone-in pork chops, Uetz said. And, the ground beef category has continued to grow by significant percentages during the recession. Uetz predicted that many of these shifts and adaptations could be around for quite a while, with shoppers continuing to expect good values.
“I think there's always going to be a place for value,” Uetz said. “This was an interesting period for a lot of consumers, a lot of younger consumers in particular had never been through a recession. I think it had a pretty significant impact on the mindset of consumers as they go to the food market and to restaurants. We may be looking at a whole new paradigm of consumer shopping habits.”