by Kevin Waetke
It’s no secret that the U.S. protein industry is in expansion mode. With pork production expected to be up more than 12 percent in 2017, Pork Checkoff staff and leadership spent the summer defining today’s pork demand “landscape.”
What motivates people to buy pork? What barriers are in play to prevent them from doing so? Step one is attaining more market intelligence through research.
“Previous Checkoff intelligence was an inch wide and a mile deep,” said Jarrod Sutton, vice president of domestic marketing. “That’s not enough today.”
He added, “We can no longer focus research on simple demographics. We need to fully understand what motivates people to purchase pork and share that with our retail and foodservice partners.”
In June, the Checkoff announced a marketing strategy shift from 30 years of business-to-consumer advertising to a business-to-business consulting model. This called for a foundation of research on the growing millennial and multicultural audiences, who share a drive to stay connected and to seek information through digital communications.
“Once initial research is complete, we will have an in-depth understanding of pork consumers and opportunities for growth,” said Patrick Fleming, director of market intelligence for the Checkoff.
“That means exploring demand for fresh and processed pork both at home and out-of-home,” Fleming said. “We will share insights with our packer, processor, retail and foodservice partners to inform and inspire their business strategies.”
Part of the demand landscape is understanding how pork is sold.
“Retail pork sales volume is about 70 percent fresh and 30 percent processed,” Fleming said. “Yet in foodservice – which for the first time surpassed retail pork sales by volume – it is the reverse, with 30 percent fresh and 70 percent processed.”
He added, “Clearly, there cannot be a one-size-fits-all marketing approach. Throw in growing exports, and the challenges are magnified.”
In the United States, millennials have surpassed baby boomers in both volume of purchases and cumulative buying power. This generational shift influences more than sales because millennials view their purchases as a reflection of their values, beliefs and behaviors.
“Millennials also have higher expectations about understanding where their food comes from and how it is grown and processed,” Sutton said. “Transparency, authenticity, health and the long-term sustainability of food production is key.”
The pork supply chain is now highly consolidated, with just seven major food companies influencing the distribution of 90 percent of the pork procured. Companies that a generation ago served as middlemen to the marketing process now have prominent brands and are much better positioned to directly connect with consumers and pork enthusiasts.
“This fall, the Checkoff will select a strategic research partner to complete a comprehensive demand assessment,” Fleming said.“We need to know the who, what, where, when, why and how’ of pork consumption. Only then can we grow pork demand in the years ahead.”
Toward that end, the Domestic Marketing team work starts with a challenge to identify, define, and clarify the best pork target audiences for both in-home and out-of-home consumption. This also will entail identifying unique growth opportunities and ideal pork products for foodservice and retail, as well as providing new insights into messages that will make consumers more loyal to pork.
“We will only be successful if we provide our customers with a comprehensive, in-depth understanding of the pork consumer and opportunities for market growth,” said Sutton. “We cannot do it all at once, but there’s a lot of runway ahead. We can build long-term relationships by providing research that illuminates opportunities and guides strategies.”
Be credible. Pork producers must demonstrate sound production practices and be transparent. Research results may reveal good, as well as bad, news for pork in the context of market trends and consumer preferences.
Mine new data for insight. The Checkoff needs to understand pork’s stakeholder targets and priorities. For example, many retail and foodservice partners may wish to identify their own audience segments within the dataset.
Come at it from many angles.
Different points of view include:
By product – Understand differences between demand for fresh vs. processed pork and between sub-categories, such as ribs vs. chops and sausage vs. bacon.
By use – Understand when and why consumers choose pork. Compare breakfast-on-the-run, special-occasion dining, cooking for the family, outdoor parties and snacking.
By audience segment – Understand both demographic and psychographic groups, such as occasional pork buyers, restaurant-only buyers, Hispanics with varying degrees of acculturation, lower income consumers and millennials.
Correlate the data. The Checkoff must provide insight on connections between and among pork consumer values, preferences, perceptions and consumption behavior.
Qualitative and quantitative input. Exploratory opinion research will delve into consumer trends and perceptions. The Checkoff needs to apply subjective information to ensure trends are accurately reflected in future quantitative studies.
Actionable audience segmentation. Research will clearly define audience segments that allow the Checkoff’s partners to see market growth opportunities that match demand with available product.