One of the trendiest of merchandising initiatives making waves in the direct marketing sector is a return to selling beef the way it used to be done 40 or 50 years ago.
What was once old is new again, as a score of celebrities have claimed credit for saying. In this case, the “new” is butchering cattle one by one at small-scale packing plant out in the sticks somewhere, like it was 1966 all over again.
Only now it’s called “marketing single-origin cuts.”
Which is a fancy way of rebranding the “old” way of marketing beef.
There have been plenty of ranchers selling direct with positioning aimed at upscale foodies. For example, Baron Farms in Washington state positions its operations as “a diversified highly sustainable family farm raising grass-fed beef, pastured pork, pastured brown egg laying chickens, pastured meat chickens.”
But now, there’s a new slogan being floated.
As a Wall Street Journal report noted, ‘Single-origin’ cuts are taking the local food craze to new heights,” and the tactic in place at Whole Foods Market, Amazon.com and FreshDirect, an online grocery delivery service based in the New York City area.
This new wave of start-ups is capitalizing on access to private ranches and the “single-origin” cattle that can be also marketed as natural, organic, grassfed, free-range and/or any combination of the above.
For example, the Honest Beef Co., which WSJ lauded as “cutting out the meatpacking middlemen and grocery chains in a foodie twist on traditional mail-order businesses like Omaha Steaks International,” is run by Hannah Raudsepp, a 26-year-old who’s marketing cattle from her family’s Nebraska ranch. The cattle are individually butchered at local packing plant, which also dry-ages the cuts.
Those cuts are them marketed online orders and shipped to consumers, who have to order at least $85 worth of beef.
Honest Beef’s website advertises a package of benefits that hits half a dozen hot buttons marketers have documented as being positives for the segment of affluent online shoppers high on every retailer’s wish list, including:
- “Nose-to-tail:” Conscious eating that uses as much of the animal as possible.
- “Dry-Aged Angus:” As opposed to the 90% of beef that isn’t dry-aged.
- “Ranch-direct:” Your purchase arrives via the most direct supply chain possible.
- “100% traceability:” Each cut is traceable to the ranch and animal of origin.
You have to credit Honest Beef for packing more than a dozen selling points into their home page infographic. There’s “conscious eating” for the enlightened foodies among us. “Dry-aged beef” for the gourmet aficionados. “Direct supply chain,” meaning that the only effort required is a short walk to the front porch to retrieve the Styrofoam cooler the UPS driver just dropped off. And “traceability” back to a single animal for the folks who’ve bought into the meme that “mixing meat from hundreds of cows” to produce ground beef is somehow a threat to national security.
But is it good or bad?
Of course, direct marketing, though big business for the small operators, hardly jeopardized conventional supermarket and foodservice sales. According to the Wall Street Journal, sales of meat labeled “minimally processed” totaled $1.3 billion in 2015, which barely puts a dent in meat and poultry sector sales of some $200 billion annually.
And the cost structure of high-end, direct-market sales practically guarantees such those products will continue to be limited to the small segment of the population that can afford premium price points that are often 20% to 30% more expensive than the product mix available at name-brand supermarkets.
Here’s the operative question: Is the single-animal marketing strategy good for the industry?
On one hand, it positions beef production as being sustainable, family-farm oriented and supportive of small business, all of which poll very positively when people are asked about values that matter to them.
On the other hand, single-animal origin as a consumer benefit that warrants a premium price point pointedly implies that non-single-origin beef is unwholesome, less desirable and somehow suspect.
The single-origin development is one worth watching, given that online sales have become a marketing tsunami that have already swallowed up conventional brick-and-mortar retailers. Dry-aged, single-origin, grassfed, traceable beef won’t displace jewelry and electronics on many people’s Christmas shopping list, but the perception that such marketing initiatives create could be troubling.
Most people can’t afford to shop for ground beef online, and the economics of such product lines preclude any movement into mass merchandising for the foreseeable future.
But the implication that supermarket beef costs less because it’s worth less could definitely become conventional wisdom, a development with far greater impact than any new wrinkle in direct marketing.
The opinions expressed in this commentary are solely those of Dan Murphy a veteran food-industry journalist and commentator