Consumers willing to pay extra for affordable premium meat, research shows
3rd July 2023
Despite the cost-of-living crisis still impacting household finances, recent AHDB research has uncovered that consumers are willing to treat themselves in-home as a cheaper alternative to eating out, which presents an opportunity for some premium meat products.
In the study, nearly three in five consumers whose household finances have worsened as a result of the crisis indicated they are going to spend less on eating out. However, despite financial constraints, shoppers are still looking to treat themselves, with 55% agreeing they would be willing to pay extra for better quality meat.
This is known as the ‘Lipstick Effect’, the theory that when faced with an economic crisis, consumers will be more willing to buy affordable treats and indulge in guilty pleasures, albeit less often.
Kim Heath, AHDB senior retail insight manager, said: “When treating OOH [out of home], we know consumers favour meat-based dishes such as lamb, steaks, and burgers, and what is evident in recent demand data is that some of these areas are actually seeing some positive trade up within retail, bucking the overall grocery and total meat, fish and poultry (MFP) trend.”
Within beef, steaks overall are seeing volume declines of -7.3%, driven by all steak cuts. However, a deeper delve into the data reveals that among the cheapest steak cut, rump (average price of £15.40 per kg versus total steaks at £16.37 per kg), the premium tier has grown by 0.2%, stealing 0.5% share of the rump category.
Moreover, some shoppers who have in the past purchased standard sirloin steaks and premium fillet steaks, both at higher cost, are now buying premium rump steaks instead. Therefore, among some consumers, buying premium steak cuts at the lower end of the price range are a way to save money while staying in the category.
Within pork, premium tier growth is seen in several areas, specifically shoulder roasting, chops, belly, and mince. Premium pork cuts may therefore offer an opportunity for those who feel the need to trade down protein to save money but still want to deliver a treaty meal opportunity.
Within beef, pork and lamb, a positive trend is seen for premium added-value offerings. In the sous vide category, the premium beef tier has seen volume growth of 17.9%, with pork up by 63.7% and lamb by 12.0%.
Meanwhile, a lamb premium tier growth of 37.4% is also seen for marinades, stealing just over 7% volume share of the lamb marinade category.
Ms Heath added: “While current financial difficulties favour the lower priced tiers, the ‘Lipstick Effect’ still provides opportunities for treating meals. Capitalising on these occasions is vital, with treaty red meat meal inspiration and reassurance around premium quality meat at point of purchase.”
The full research can be found here.
