Grocery stores are growing confused about where, exactly in their stores, they should be selling Beyond Meat products.
After all, the company does have “meat” in its name, and the company “bills itself the world’s first plant-based burger sold in the meat case of U.S. grocery stores,” according to Reuters.
But grocery chains are thinking of relocating the products toward the vegan sections of their stores, a move that could highlight exactly how valuable grocery store real estate is. Beyond Meat, of course, seeks to carve out a niche for itself in the meat section, before competitors like Impossible Foods hit store shelves.
Natural Grocers by Vitamin Cottage Inc, which owns some 150 stores in 19 states, said that they place the company’s products in a section with “other alternative proteins”. At the 35 Kings Food Markets and Balducci’s Food Lover’s Markets across New York, New Jersey, Connecticut and the Washington D.C, the product can be found in both the dairy and meat section.
Stephen Corradini, chief merchandising officer at KB US Holdings Inc, who owns the stores, said: “Sales in both spaces have been great and customers generally view this as a new food category.”
Town & Country Markets Inc in the Pacific Northwest, New York-based Morton Williams Supermarkets and Fresh Thyme Farmers Market in the Midwest have all also said they are seeing high demand regardless of where the product is placed in stores.
Beyond Meat specifically avoids terms like “vegan” and “vegetarian” to help it square up in its battle against traditional meat companies. Beyond Meat markets its products as looking like and cooking like traditional ground beef and targets mainstream consumers who want to reduce meat consumption, generally due to health risks and animal welfare concerns.
“Find it in the meat aisle,” Beyond Meat says of its product.
The company has warned in regulatory filings that changes to its in-store placement could negatively affect growth and analysts consider the company’s strategic placement a “strong advantage” and a “differentiating factor” over competitors.
And as of now, the company doesn’t have any contracts regarding product placement in stores. Some grocers place the product in freezers near other veggie burgers – or even the dairy section – as they evaluate sales and work to decide on a long term strategy.
Dwight Richmond, Fresh Market’s director of grocery, said: “The freezer section is our initial go-to destination as our guests otherwise wouldn’t intuitively know where to find the product.”
Sean Saenz, senior director of meat and seafood operations at Gelson’s said they did not see strong sales when they placed the product in the freezer. Since moving it out of the freezer, sales are up 60%, versus sales in the vegan section growing 20% over the same period of time.
He said: “We’re still heavily weighted on probably 60 to 70 percent of the Beyond Meat being sold from the vegan location. I don’t think it will ever be as big as meat, but it’s definitely adding growing sales which is something every retailer is looking for.”
The U.S. Cattlemen’s Association, obviously, disagrees with placement in the fresh meat case.
Lia Biondo, USCA’s director of policy and outreach said: “These plant-based companies are riding on the coattails of the beef industry, which has spent decades building up a healthy brand consumers trust.”
And there’s no sign of the war over placement slowing down. Phil Lempert, an expert on retail food trends who advises companies on food branding and consumer behavior concluded: “Competition over placement is clearly heating up as everyone vies for a spot in the meat case.”
via ZeroHedge News http://bit.ly/2IqrUl8 Tyler Durden