| | A new project calls for greater focus on brand, with organic, naturally raised, and lean beef the biggest opportunities.
With today’s beef industry facing challenging economics, many producers are looking for alternatives to boost revenue and secure markets. For these producers, Pat Ramsey says: think brand.
“A brand is a way to differentiate a product and stand out in the consumer’s mind,” says Ramsey, Opportunity Analyst with Alberta Agriculture and Food in High River.
To gather available research on branded beef, and share lessons learned by producers, Ramsey leads a team looking into Branded Beef Marketing Opportunities. The team summarizes consumer trends that support branded beef (see below), with the aim of identifying market factors and potential new markets.
They are creating an inventory of potential new suppliers to branded beef programs, helping to nurture strategic relationships along the supply chain and describing in detail how producers are making branded beef programs work sustainably.
“There are certain ‘credence attributes’ that some consumers are asking for,” says Ramsey. “We’re seeing a lot more interest in organic, in naturally raised product and in lean beef.”
Three categories, three success stories
These three credence attributes – organic, naturally raised and lean – are behind the success of three remarkable branded beef programs.
Organic. To be certified organic, which can take three years, producers do not use growth promoting implants, feed additives or antibiotics. Organic feed has not been exposed to chemical fertilizers or pesticides.
A standout example is Diamond Willow Organics, founded in 1997 by seven ranch families, whose beef sells for a premium price at both large and specialty retailers.
Naturally raised. This is similar to organic but protocols are not as rigorous, since animals can be fed conventionally raised feeds. Animals are grown without growth - promoting implants, feed additives or antibiotics. Price is lower than organic, but higher than conventional.
Spring Creek Ranch Premium Beef started in 2000, as a sister company to Highland Feeders near Vegreville. Their boxed, branded beef has multiple marketing channels: food service distributors, restaurants and retailers.
Lean. In this segment, animals are raised for their leanness and so production focuses on breeds that are naturally leaner: Limousin, Blonde d’Aquitaine and Piedmontese. The price point is similar to natural.
Laura’s Lean Beef, founded in 1985, is the largest provider of natural, lean, fresh beef in more than 5,200 grocery stores in North America.
New Branded Beef Strategies website on the way
Ramsey cautions producers about keeping price expectations realistic. “There is not as much premium as producers might think,” he says. “Much of the benefit comes from reducing transaction costs and optimizing the supply chain.”
Still, Ramsey believes branded beef can enable producers to increase revenue and access new markets. But which markets? To help producers navigate the possibilities, and find the opportunity that suits them best, his team is developing a website.
“We see the website being the hub of information for anyone who’s looking to get into branded beef programs,” says Ramsey. “It will allow producers to look into alternative production methods, and compare different branded beef programs.”
For more information on branded beef opportunities, contact Pat Ramsey at (403) 652-8303 or email pat.ramsey@gov.ab.ca or contact Laura Lee Billings at (403) 948-8519 or lauralee.billings@gov.ab.ca
Presentations made by Diamond Willow, Spring Creek and Laura’s Lean at the Choices for Consumers Conference last March at Olds College can be seen at the conference web site: http://www1.agric.gov.ab.ca/$department/deptdocs.nsf/all/ind11317.
Consumers are driving change
According to a July 2005 study by Serecon Management Consulting, these are the top-12 Canadian food trends that will be in evidence through 2020.
1. Aging Canadians. More seniors than ever, with implications for type, quantity and consumption patterns of food.
2. An evolving society. Smaller households, greater workforce participation, globalization and environmental awareness will make brands less a status symbol and more a statement of individuality.
3. Changing meal patterns. Fewer whole meals, more snacking and more eating on the go.
4. Shifting expenditures. We’ll spend less on food, but more of our food dollar on prepared meals and takeout.
5. Food for health. The most significant health driver will be obesity, leading to cardiovascular disease and diabetes. Nutraceuticals will help, though.
6. The educated consumer…fads or trends? A focus on zero trans-fats, low sodium, healthy/high fibre carbohydrates, reduced sugar, allergen identification, fortification and health claims.
7. The new face of Canada. Immigration will be driven from regions off the Pacific Ocean, especially in larger urban centers where visible minorities will make up to 50% of the population.
8. No trade-off for convenience. Consumers want it all -- taste, quality, nutrition, convenience, variety, value – and food companies will go all out to give it to them.
9. Veggies anyone? True vegetarianism may not grow dramatically, but consumption of meatless meals will continue to increase.
10. Organic foods. Growth rates have been about 28% per year, with 70% of organic food imported into Canada. Alberta organic producers, over to you.
11. Small indulgences. Canadians will embrace gourmet foods and boutique brands, savoring slow foods, high quality, smaller portions and sound nutrition while shrugging off premium prices.
12. Food safety and production issues. If a food safety issue makes the news, growers and processors of the offending food will pay dearly, though often temporarily. |
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