Meat of the Matter: Looking ahead

Meat of the Matter: Looking ahead

Drovers CattleNetwork, By JoAnn Alumbaugh, Editor, PORK Network January 05, 2017

It’s the beginning of a new year, and as predictable as bowl games and hangovers, the month of January arrives full of predictions about what’s ahead for the food industry and for business in general.

Lots more convenience, new products and better packaging are all mandatory for any company that wishes to grow, or at least maintain, market share — although such priorities could have legitimately been at the top of the list for food processors at any time in the last couple decades.

Among the myriad of “what’s ahead” pieces targeted to food industry, one set of predictions of a more general sort appear to be equally relevant to the meat and poultry industries, and thus to animal agriculture. These come from the consulting firm Deloitte, more specifically, the UK-based parent firm Deloitte Touche Tohmatsu Limited, which annually assesses the consumer products marketplace in a report titled, “2017 Consumer Products Industry Outlook.”

The term “Consumer products” obviously embraces a far greater range of goods, services and consumer spending than just food purchasing, but a couple key parameters examined by Deloittle’s analysts are as relevant as any of the narrower, food-only predictions other consulting firms typically compile.

One of the factors cited in the report is beyond any single company’s control; the other factor offers unique opportunities to accelerate revenues and profits.

The first factor is the obvious one: economics.

Nothing impacts consumer spending more than the state of the economy, and as beef, pork and poultry tend to be pricier choices versus some other food categories, the state of the economy definitely matters. According to Deloitte, the “economic fundamentals for consumer spending appear to be solid” for 2017. Disposable income is “edging up,” hourly earnings are accelerating and housing prices and “key equity indices” are at all-time highs, boosting household wealth and driving strong consumer spending.

Plus, consumer confidence is “elevated — even after the 2016 election,” according to this analysis.

The Online Advantage
Nobody discounts the impact of both the perceptions and realities of the economy as a driver — or a brake — on consumers’ food-related spending.

There’s another trend that often finds even the savviest food companies behind the curve, however, and that is the way consumers are spending all that disposable income. As Deloitte’s report phrased it, in an increasingly segmented marketplace, “consumers have growing expectations of being treated as individuals and likely won’t settle for mass-produced products in the future.”

“Future” meaning “right now.” Anybody order any gifts online this recent holiday season?

Digital marketing is no longer merely a channel for hip, young Millennials and members of Generation Z (or whatever that even younger cohort is supposed to be called — the iGeneration, the ReGens, or dumbest of all, what MTV tries to label as “The Founders.” Good luck with that one).

Point is, not only are online sales platforms essential for consumer purchasing, but digital messaging is now critical for reaching the multi-millions of consumers younger than 30. That might not be quite as critical for food products, but as packaging, shelf life and home delivery services continue to expand in importance, there’s no doubt that online sales are going to become ever more important going forward.

“[Marketers] need to develop contemporary messages delivered through cutting-edge, digital platforms,” the Deloitte report explained, “and leverage these advancements to form lasting bonds with younger, connected consumers in all aspects of marketing.”

How big a priority should that initiative be? Although online retail spending is substantial — approaching a half-trillion dollars annually, according to, forget the calculations of how much is spent online, versus brick-and-mortar purchases, because that’s not the only factor in play here. A recent Deloitte analysis estimated that 56 cents of every dollar spent in a store is influenced by a consumer’s digital interaction with the product over multiple devices before making a purchase.

Here’s an even more eye-opening statistic, according to Close to 75% of consumers under the age of 30 use their smartphones for shopping — while they’re inside a store. In other words, even while making a traditional in-store purchase, today’s younger shoppers are online interacting with social media and digital platforms.

By the way, although we’d all guess that search engines such as Google, Bing and Yahoo are how most people connect with potential online retailers, do you know which social media channel delivers the highest per-purchase value?

Answer: Twitter. That’s right: Twitter feeds lead to average purchases that are as much as 20% higher than typical search engine-generated sales, according to, a San Francisco-based e-commerce consultancy.

Why is that? Because those who respond to Twitter feeds do so because of a high trust factor. We don’t care about what people we don’t consider relevant have to say about shopping.

Or anything else.

And in sales, that’s as traditional as it gets.