Grocery Business - December 2018

Fresh beef has always been a grocery mainstay: It has urvived numerous wars on red meat, depressions and recessions, mad cow disease scares and a vari- ety of other roadblocks that could have easily been its downfall. But what does the future look like for the reliable staple as the rise of e-commerce, plant- based foods and new tariffs make the fresh meat landscape even more complicated? The issue is a crucial one, because meat is one of the largest drivers of basket cost. According to the joint Food Marketing Institute (FMI)/Foundation for Meat & Poultry Education & Research 2018 Power of Meat report, when meat is in the basket, the average spend more than doubles, from $32 with any item to $68 with meat.

While keeping up with the changing market may seem daunting, retailers can look at the upcoming years as an opportunity for innovation and reinvention as long as they stay apprised of the nuances affecting every aspect of the grocery store.

Meat Is Moving Into E-Commerce

One of the assurances grocers have always gotten from industry experts in regard to growing competition with e-commerce is that their basket-driving fresh section will not be severely affected, because consumers tend to be wary of buying fresh items, and especially meat, online.

But this may no longer necessarily be true as meat makes
its way into web-only markets, which could potentially
boost consumers’ confidence in purchasing these items
online.

For example, online better-for-you grocer Thrive Market moved out of its CPG comfort zone in April to include frozen beef, poultry and seafood, and websites such as 1000ecofarms.com connect consumers with local farm-raised meat and other farm-fresh items. Meal kits also often contain fresh meat as a key ingredient.

However, grocers are firing back by amping up their delivery programs and rolling out innovative apps that attract convenience-seeking consumers.

The App Makes the Retailer

The future of mobile retail food apps indeed looks bright, according to a forecast from eMarketer, which primarily focused on apps that deliver perishable items and meal kit providers. It predicted that one in five adult mobile-com-merce buyers will use these apps to order food by next year. This is because “shoppers are becoming more comfortable with ordering online in general, and grocery is a part of that,” says Patricia Orsini, eMarketer senior analyst.

While delivery time and the desire to hand-pick items such as meat has been a deterrent against ordering fresh items online in the past, Orsini says, “retailers have been able to transcend these barriers with click-and-collect models of delivery.”