Grocers lose billions in meat sales as mass retailers gain market share

By Staff
3 Min Read

Dive Brief:

  • While meat is the biggest revenue generator among fresh departments, supermarkets are bleeding billions of dollars in market share to mass retailers, according to FMI — The Food Industry Association’s latest Power of Meat report
  • Traditional grocers’ share of meat sales dropped by more than 3 percentage points from 2019 to 2023 as supercenters gained 2.2 percentage points, according to Circana data cited in the report. 
  • Strong millennial engagement is driving the increase of meat sales at supercenters, the trade organization said, noting that inflationary pressures on price and demographic shifts have impacted consumer spending in the category.

Dive Insight:

At $99 billion, meat dollar sales led perimeter sales in 2023 according to Circana’s multi-outlet data but flat compared to the prior year due to lower inflation, more promotions and consumer pullbacks on units and volume, FMI found. Circana’s multi-outlet data includes grocery, drug, mass market, military commissaries, club, dollar stores and e-commerce. 

Volume and unit sales in 2023 just missed 2022 levels. Consumers purchased meat less frequently and bought less per purchase, which impacted volumes, FMI found.

As they face growing competition from mass retailers and supercenters, grocers have room to strengthen value propositions to consumers, the report said, noting that 30% of shoppers account for two-thirds of meat dollar sales.

Since 2019, grocers have steadily lost meat dollar share as other channels have made gains

Channel share of total meat dollars

The report noted how consumer perception of meat can help grocers find more influential marketing strategies and product attributes to call out. 

For example, FMI said seven in 10 believe meat is a healthy and nutritious choice and that “protein” has become a more desirable term on packaging over the years — indicating grocers can lean into consumer appetite for wellness-focused products. 

Quality, price per pound and the total package price are the top factors influencing purchasing decisions, FMI said. With some persuading, nearly all consumers (91%) can spend a little more on meat and poultry with the right nudges, such as holidays, special occasions and catering, FMI noted.  

FMI’s report noted that more people (37%) reported in 2023 freezing purchased meat in larger quantities to use over time compared to 28% who said the same the prior year. 

The increase in consumers freezing meat signals a need for package innovation around shelf-life, portion sizes and freezer-ready options, noted the report, which is based on a survey of 1,730 adult grocery shoppers in December and Circana data. 

“With shopper case-ready acceptance reaching a record high, consider pack size variety, freezer-ready packaging, secondary displays and cross-merchandising to optimize trips and units per trip,” FMI suggested.

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