The meat market must address price, safety & health concerns to grow

By Elizabeth Crawford

- Last updated on GMT

The meat market must address price, safety & health concerns to grow

Related tags: Meat

The U.S. meat market is projected to grow 1.7% annually to $84 billion in 2018, but to reach its full potential it must overcome challenges, including concerns about price and safety and increasing consumer interest in plant-based foods, according to a new report from market analysis firm Canadean. 

Sales of fresh meat lead the market, accounting for more than a quarter of the category volume in 2013, thanks in part to the larger macro trend of consumers desiring fresh food, according to the report, which will be released in mid-February.

Fresh meat also appeals to consumers who are seeking a special indulgence, noted Canadean analyst Safwan Kotwal.

But as implied by “indulgence,”​ consumers also associate fresh meat with high prices and as less healthy than some other foods, which are challenges the industry must address actively, Kotwal said.

For example, consumers increasingly are interested in plant-based foods, which they perceive as a way “to taste nature in its pure form,”​ or as a way to quickly lose weight, Kotwal said.

“In order to address this challenge, meat manufacturers can promote leaner cuts of meat, which are high in nutrients and protein and at the same time, offer indulgence and great taste,”​ Kotwal said, adding: “Premium steak, for example, is low in calories and high in protein and contains the nutritional benefits consumers are looking for, without compromising on taste.”

Competing on price

In addition, Kotwal said, fresh meat manufacturers must ensure that they keep their prices competitive to appeal to value-conscious consumers. This is increasingly important considering stagnant wages in the U.S. mean nearly a quarter of shoppers continue to struggle to pay their grocery bill, according to recently released IRI data analysis. (Read more HERE​.) 

Tight finances are driving some consumers to opt instead for frozen meat, which often costs less, according to Canadean, which estimates this subcategory will account for $22 billion, or 26% of the meat market by 2018.

In addition, processed foods have been growing in popularity over the past decade due to their affordability and convenience, Kotwal said, noting ambient cooked meat combined now accounts for $20 billion of the meat category’s sales.

Improve the quality of unbranded meat

The meat industry overall can reduce the threat of financially strained consumers leaving the catgory by improving the perceived quality and trustworthiness of private label meat, which Kotwal said is generally less expensive than branded fresh and frozen meat.

Kotwal notes that non-branded meat must overcome lingering consumer concerns and confusion about recent food scares, such as the horse meat scandal in Europe, by meeting consumer demand for increased transparency.

“Consumers concerned with food safety and supply chain issues will demand that certain categories, or products with ethical propositions, provide public access to detailed product tracking,”​ Kotwal explained, adding: “However, 100% transparency means suppliers will need to hold themselves to greater standards to succeed in this market in the future.”

They also can regain consumer trust by displaying credible food certifications on packaging, such as organic certification, or allow animals to roam free, which consumers associated with better flavor, ethical treatment and health value, Kotwal sasid. 

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