By: Howard Riell | November 6, 2023
While inflation plays a role with meat snack sales, c-store retailers are finding ways to draw consumers to the category, including by stocking changing flavor and package size preferences.
Stubborn inflation may be impacting meat snack sales at c-stores, but loyal customers are still finding ways to grab their favorite meat snacks on the way out the door.
Price aside, health concerns, taste trends, package size and promotions that stress value have become more important than ever.
For the 52 weeks ending Sept. 10, sales of dried meat snacks across the c-store channel totaled $2.2 billion, down 1.4%, according to Chicago-based market research firm Circana. Within that category, jerky notched sales of $872 million, a drop of 5.1%.
“In the U.S. convenience store market, meat snacks have a positive sales outlook, with a compound annual growth rate of 7% from 2022 to 2027, reaching a total value of $1.7 billion in 2027,” reported Hannah Cleland, an analyst in the consumer division of GlobalData. “Convenience stores are an important channel for meat snacks, accounting for 25.6% of all U.S. retail sales in 2022 and increasing to 26.4% by 2027. This said, convenience stores and meat snack brands will have to address evolving consumer trends in order to stay competitive.”
Pricing Predicament
Despite meat snack sales only dipping minimally across all c-stores, per Circana, individual chains are seeing different results.
“All brands have seen a major decline in unit sales thus far in 2023. Customers seem to definitely be monitoring how they spend their money,” said Mike Jackson, category manager for Carroll Motor Fuels’ High’s Stores, which operates 60 c-stores in Maryland, Delaware and Pennsylvania.
“The higher costs and retails on meat snacks have definitely impacted sales. I believe customers are looking at the high retails on the larger bags and are choosing to spend that money on something else. When a bag of jerky costs almost the same, if not more, than a sandwich and a drink, the customer is deciding to spend their money on a meal,” he continued.
Additionally, Cleland pointed out that meat snacks typically have a higher price point than other savory snacks, such as nuts and potato chips. “Brands will have to combat this through meat snacks’ positioning as on-the-go, nutrient-rich products as additional justification of value,” she said.
For those customers choosing to purchase meat snacks at High’s, it seems as though sales have seen a return to the stick segment.
“The majority of SKUs showing increases in unit sales compared to last year are the lower-priced sticks. The 3.25-ounce jerky has seen a significant decrease, but the largest decrease has been the larger 10-ounce-sized bags,” reported Jackson.
High’s stores feature meat snack endcaps that are highly visible to customers and carry both stick and jerky products.
“This allows the customer to compare prices and determine for themselves what the best value is,” Jackson noted.
Jackson explained that High’s has implemented a variety of promotions this year to help garner sales.
“With retails so high, doing any kind of two-fer or bundle promotion is problematic. The price point is just too high for customers to consider it a value,” he said.
At the Army & Air Force Exchange Service’s (AAFES) stores, on the other hand, “our two-for-$12 pricing is seeing great results,” Randy Demster, the system’s consumables meat snacks buyer, reported. “In addition, bundling a meat snack and a beverage is a very effective promotion.”
Trend Alert
Health and wellness remains the most influential consumer trend in shoppers’ product and service choice, according to GlobalData’s TrendSights consumer trend framework.
“Meat snacks, which can be viewed as highly processed, fatty and salty, will have to improve formulations and marketing to persuade customers of the health benefits,” Cleland said. “For instance, leaner cuts of meat could prove beneficial due to low fat and high protein content, if positioned correctly.”
Additionally, meat substitutes and plant-based products could still stand to offer a nutritionally and sustainably superior alternative to meat snacks, GlobalData found. However, the plant-based/meat-substitute market has been struggling with dampened growth projections and formulations and production processes yet to be perfected.
“Alternate protein sources such as chicken and pork are a growing trend in meat snacks at the Army & Air Force Exchange Service’s Express stores,” said Demster. “Bulk bagged meat sticks and beef jerky are trending, as well.”
AAFES operates more than 580 Express c-stores.
At present, Demster has added Jack Link’s, Old Trapper, Cattleman’s Cut and No Man’s Land Beef Jerky, which are all hot brands at Exchange stores.
“The fastest-growing flavor is hot-and-spicy, and the Exchange is seeing unit movement increasing in the core sizes of two-ounce and 3.25-ounce bags,” he said.
Inflation has caused shoppers to move to smaller pack sizes in meat snacks.
At High’s, spicy items are also still at the top of unit sales.
“Meat snacks are an impulse buy and should be merchandised on queue lines and in self-checkout lanes,” Demster recommended. “Shippers are also a great way to merchandise the products, creating secondary locations in the store and increased takeaway.”
Source: CStore Decisions