Beef Drives Higher Total Store Sales

Alison krebs | June 14, 2019

Driving shopper traffic, particularly for stock-up trips, is critical in today’s highly competitive retail environment. Top-line sales in this low-margin business are paramount, whether made in-store, via website or app. While beef continues to propel meat department performance, this article looks at how beef continues to drive total store revenue, as well.¹

Amongst proteins, beef reigns. It brings in more dollars than any other item at retail (2.1% of total), while nearly 6.3% of baskets include beef.² This makes beef a formidable revenue generator in its own right. Further, the average basket with beef is more than twice that of the typical ring ($85.70 vs. $41.33, respectively). So, bringing in beef shoppers generates greater sales across the entire store, as well. This power to drive sales is one reason beef remains a favorite feature item for retailers as well as their shoppers.³

Diving further into the latest data, baskets including steak top out at nearly $92, while baskets with Ground Beef average nearly $89. In comparison, a basket with chicken comes in shy of $85, and for all the recent headlines, baskets containing beef substitutes (such as plant-based burgers and veggie crumbles) are the smallest of those measured, at just under $82 (Chart 1). Chart 1 further shows that baskets with Ground Beef and steak generate the most other-product sales, while steak and Total Beef carts have the highest “target product” sales (e.g. steak at $15.47). This is expected, as steak is a relatively high-priced item whereas Roasts (included in Total Beef) tend to be larger in size.

Source: IRI Panel Data, All Outlets, 52 weeks ending 1/6/19, Market Basket Study, February 2019.

Chart 2 shows the share of trips where carts contain beef, chicken or beef substitutes, as well as the respective products’ share of total basket dollars. Note that beef is in the cart much more frequently, and that respective product sales are substantially larger, as well. Given these measures and average basket size, Chart 3 shows that baskets with beef drive 44% more total store sales than baskets with chicken and 21 times the total store sales as baskets with beef substitutes. So, while beef substitutes (and occasionally chicken) may grab headlines and add product options, beef drives sales.

Source: IRI Panel Data, All Outlets, 52 weeks ending 1/6/19, Market Basket Study, February 2019.

What else is in shopper baskets when they buy beef? Not surprisingly, it depends on the beef item type. Beginning with the steak basket, meat-related sauces and higher-end cheeses are present, along with fresh produce and cranberry juice. Steak enthusiasts also purchase the widest variety of animal proteins (including fish and seafood). Ground Beef buyers select a myriad of spices, mixes, sauces, sliced cheeses and pastas, in line with Ground Beef’s versatility and ingredient use. Total Beef baskets resemble those of Ground Beef (given Ground Beef’s high share of beef sales), although more frozen and canned vegetables are present, as well. When looking to leverage the power of beef throughout the store, these items offer retailers cross-promotion, display and product call-out opportunities.

Given beef’s broad product offerings and its flexibility to meet varying consumer needs, it’s readily purchased across all consumer demographic groups: race/ethnicity, education, income, gender, etc. That said, there are some subtle differences. For example, Hispanic and Asian populations gravitate towards steak (which fits these cuisines). Lower and middle-income, lesser-educated and older consumers all purchase more beef than average, while higher-income households choose more steak and rural households buy more Ground Beef. Compared with many other grocery products, however, beef has a consistently broad appeal across all demographic groups.

Consistent with prior research, beef continues to drive more total store sales than other animal proteins.⁴ Today, this is still the case. With its various cuts and preparation options, for the grill, skillet, slow cooker, oven and beyond, beef gives consumers the flexibility to meet their everyday to celebratory needs while driving total store sales, as well.

The analysis in this article is primarily based on IRI panel data. Unlike IRI point-of-sale (POS) data, IRI panel data captures trip-by-trip purchases for a representative sample of 100,000 US households. These item-to-purchaser links allow us to better understand beef purchasers, their buying habits, and how beef in their basket contributes to total store sales.
IRI Panel Data, All Outlets, 52 weeks ending 1/6/19, Market Basket Study, February 2019.
Retail Feature Trends: Beef Remains a Driver, BIWFD.com, May 16, 2019.
IRI Panel Data, Total Grocery, 52 weeks ending 6/14/14, Market Basket Study, July 2014.