As customers continue to crave variety and new taste profiles, meat snacks manufacturers are staying on their toes, and providing c-stores with a range of new options to keep shoppers coming back for more.
By Howard Riell, Associate Editor.
When Americans want to snack, nothing holds them back.
Time constraints paired with consumer demand for smaller portions and convenient eat-on-the-run options have made snacking around the clock routine, and a perfect opportunity for alternative items—like meat snacks—to gain traction.
“It’s a stable category, maybe slightly growing, but has big potential,” said Bob O’Connor, president of O’Connor Petroleum, operator of three Jetz Convenience Centers in Hales Corners, Wis. “It’s a protein snack that people seem to be migrating toward, albeit slowly. My impression is that there is nothing shaking the market in terms of a new product. From what I’ve seen, the tried and true products—beef jerky and beef sticks in bold flavors—are the ones that people migrate to the most.”
That said, O’Connor believes suppliers can and should be doing more to stimulate business. “Frankly, my personal opinion is that there should be something more done with meat snacks,” he said. “It’s a great category. It’s a way for people to perhaps choose healthier protein over a sugar snack. Obviously Jack Link’s does a great job marketing it, but I would like to see some others in the arena take it to a higher level. We need some more product promotions and some brand competition to help bring prices down for our customers.”
Another promotion O’Connor wants to see is the category emphasized as healthy snack option. “Many consumers consider jerky as a healthy alternative to a sugar snack or chips,” he said. “It is protein-based, so I think there is somewhat of an impression that it’s healthier for you. Perhaps this is the place where there is room to grow in that category. I think if a supplier were to promote a so-called ‘healthy’ meat snack it might gain some traction.”
Each Jetz store merchandises its meat snacks toward the front of the store, on an endcap devoted solely to the category. “It’s a full display, so we give it a very strong presence in our stores,” O’Connor said. “That would be my recommendation to others.” He further urged his retail colleagues to place similar emphasis on merchandising their meat snack sections. “Make sure your inventory is fresh and never let the products get beyond their sell-by dates.”
As with so many other product categories, demographics are vital. With youngsters comprising a growing percentage of c-store consumers, their attitudes toward meat in general—centered squarely on health—will certainly affect the growth of the beef jerky category. Chicago-based Technomic Inc.’s “2013 The College & University Consumer Trend Report” queried 1,500 full-time students who were 18 years old and over and found the following food for thought:
• The overall student population consumes meals with meat as often as meals without meat, but men report that a larger proportion of their daily meals contain meat.
• Students polled reported that an average of 51% of the meals and snacks they consume in a day includes meat.
• There is a significant disparity in meat consumption between men and women. Men report that the majority of their daily meals and snacks (59%) include meat in some form. Women, on the other hand, say that the majority of their daily meals (55%) do not include meat at all.
• Those who avoid animal products are likely to do so for health reasons. A quarter of students (24%) say they avoid pork, and 17% of students say they avoid beef. In fact, the “Center of the Plate: Beef and Pork Consumer Trend Report” from Technomic found that health was the leading reason why consumers do not eat beef and pork. Turkey (14%) and chicken (11%) are avoided by fewer students, likely because these options often act as better-for-you alternatives to red meat.
Potential for Growth
Tom Pirko, president of BEVMARK LLC, a retail consulting firm in Buellton, Calif., agreed with O’Connor that the category relies on innovation and new flavors to thrive.
“As the spirits and beer industries are being driven by ‘flavors’, so c-stores need to search out new and unusual meat products to revive interest. So many of the meat snack products have been on the shelves for so long they have become invisible to consumers, especially young consumers who want to experiment,” he said. “So when you do see bold, unique flavors hit the market, they tend to generate some excitement.”
Matthew Paduano, vice president of category management for Nice N Easy Grocery Shoppes Inc. in Canastota, N.Y., said overall sales in the snack category are up across the board, but there are significant differences in sales trends among the subcategories.
Meat snacks remains one of those subcategories that continues to show increases in sales volume year over year. “There has been much innovation in this subcategory, with different flavorings and the addition of new meats to the list, most notably turkey and the very hot bacon flavor. Bacon seems to be every vendor’s best item at the moment, and more SKUs of this are coming to market all the time,” Paduano said. Meat snacks, he concluded, are viewed as being a more healthy alternative for the snacking occasion. “Resealable bags make this a convenient feature, as well,” he added.
Steven J. Montgomery, president of b2b Solutions LLC, in Lake Forest, Ill., suggested that too many retailers make a mistake by having too many meat snack vendors represented on their shelves. “I have seen retailers who might have as many as six or seven, including the industry mainstays, and then a variety of small local vendors. The store looks like a meat-snack shop rather than a c-store. This fractionalizes the sales to where no single vendor is generating the type of return on the space and investment in their inventory that they should,” he noted.
Another issue, in Montgomery’s opinion, is placement. “The industry has learned that people come in with a destination in mind, often a beverage. Trying to sell them on the way to that item is far less beneficial than trying to sell them something after that have selected the item. This should be kept in mind when placing meat snack and other displays.”
The meat snack category’s dollar sales rose 6.1%, with market share leader Jack Link’s outpacing the category with an 8.4% increase, and is the largest dollar growth contributor to the category, according to Nielsen data for the 52-week period ended Oct. 28, 2013.
Pondering the Future
Looking ahead, Pirko said he expects to see meat snacks serve as the primary vehicle for the extension of fast-food brands into the convenience store space. “The primary competitors for many c-stores are fast-food outlets and their drive-throughs. Meat snacks could be a popular item for this space,” he said.
Pirko also believes the time has arrived for brand consolidation and more promotional activity centered on the leading national brands. “A few select manufacturers are pondering possible future licensing deals,” Pirko explained. “How can this work? Think what Starbucks did placing its brand in retail, in supermarkets. The national c-store chains like 7-Eleven should be chatting with chains like Burger Kings to license their proprietary brands. Cross-promoting and marketing is going to be key going forward. Consumer needs are diverse and dynamic. All retailers should be looking to share the wealth.”