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The U.S. Market for Refrigerated Processed Meats - Volume I: Market Overview
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Apr 1, 2002
238 Pages - Pub ID: LA747857
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- Executive overview
Scope and Methodology
- Market Parameters
- Report Methodology
Market Overview
- Convenience Meat Basics
- The Packaging Challenge
- Government Regulators and Product Safety
- "Zero-Tolerance" Policy for Ready-to-Eat Meats
- Irradiation and Food Safety Technologies
- Refrigerated Processed Meats Market Expected to Top $17 Billion in 2006
- Table 1-1: U.S. Retail Sales of Refrigerated Processed Meats by Product Category, 1997-2006 (dollars): Lunchmeats/Lunch Kits, Frankfurters/Dinner Sausage, Breakfast Meats, Convenience Meats
- Supermarkets Account for 80% of Total Retail Sales
- Factors to Market Growth
- Convenience Meats Take Off
- Dinner Sausage Sales Boost Overall Market
- Consumers Demand Tasty, High-Quality Products
- Convenient Products Appeal to Busy Consumers
- Heavy Advertising
- Three Classes of Marketers
- Kraft on Top
- Figure 1-1: Marketer Shares of U.S. Supermarket Sales of Refrigerated Processed Meats, 2001 (percent): 6 Marketers, Private Label, All Others
- Smaller Marketers Grow Through Acquisition
- Integrated Campaigns Capitalize on Brand Strengths
- Marketing and New Product Trends
- Ad Expenditures at $185 Million in 2000
- Grocery Stores Account for Lion's Share of Retail Sales
- Consumer Overview
- Children and Processed Meats
Category Focus: Lunchmeats and Lunch Kits
- Market Nears $5 Billion in 2001
- Lunchmeats Make Up Larger Category
- Billion-Dollar Food Companies in Control
- 92 Million Households Use Cold Cuts
Category Focus: Frankfurters and Dinner Sausage
- Market at $4 Billion in 2001
- Frankfurters Make Up Larger Category
- Billion-Dollar Food Companies Top the List
- 84 Million Households Use Frankfurters
Category Focus: Breakfast Meats
- Market Nears $3.5 Billion in 2001
- Bacon Makes Up Larger Category
- Large Food Companies Dominate the Market
- 83 Million Households Use Bacon
- The Products
Product Overview
- Scope of Report: Four Product Categories
- Lunchmeat Basics
- How Lunchmeats Are Made
- Lunchmeat Packaging
- Lunch Kits
- Lunch Kit Packaging
- Frankfurter Basics
- Sausage Basics
- How Sausage Is Made
- Frankfurter and Dinner Sausage Packaging
- Dinner vs. Breakfast Sausage
- Bacon Basics
- How Bacon Is Made
- Bacon Packaging
- Breakfast Sausage Packaging
- Convenience Meat Basics
- Convenience Meat Packaging
- The Packaging Challenge
- The Case-Ready Revolution
Market Regulation and Product Safety
- Regulatory Overview
- Nutritional Labeling and Education Act Requirements
- NLEA Definitions
- URMIS and the Labeling of Fresh Cuts
- The Implementation of HACCP
- The Safe Handling Rule
- The Role of Food Recalls
- Public Issues in Meat Safety
- "Zero-Tolerance" Policy for Ready-to-Eat Meats
- January 2002 GAO Report on BSE
- The FDA and the Irradiation of Meat Products
- Other Emerging Food Safety Technologies
- Debate Over Antibiotics and Fluoroquinolones
- The market
- Figure 3-1: Estimated U.S. Retail Sales of Refrigerated Processed Meats, 1997-2001 (dollars)
- Figure 3-2: Estimated U.S. Retail Sales of Refrigerated Processed Meats by Product Category, 1997-2001 (dollars): Lunchmeats/Lunch Kits, Frankfurters/Dinner Sausage, Breakfast Meats, Convenience Meats
Market Size and Growth
- Refrigerated Processed Meats Market Approaches $14 Billion
- Table 3-1: U.S. Retail Sales of Refrigerated Processed Meats, 1997-2001 (dollars)
- Lunchmeats and Lunch Kits Market Nears $5 Billion in 2001
- Table 3-2: U.S. Retail Sales of Lunchmeats and Lunch Kits, 1997-2001 (dollars)
- Frankfurters and Dinner Sausage Market at $4 Billion in 2001
- Table 3-3: U.S. Retail Sales of Frankfurters and Dinner Sausage, 1997-2001 (dollars)
- Breakfast Meats Market at $3.5 Billion in 2001
- Table 3-4: U.S. Retail Sales of Breakfast Meats, 1997-2001 (dollars)
- Convenience Meat Sales Hit $1.4 Billion in 2001
- Table 3-5: U.S. Retail Sales of Convenience Meats, 1997-2001 (dollars)
- Lunchmeats and Lunch Kits Account for 35% of Market
- Table 3-6: Share of U. S. Retail Sales of Refrigerated Processed Meats by Product Category, 1997 vs. 2001 (percent): Lunchmeats/Lunch Kits, Frankfurters/Dinner Sausage, Breakfast Meats, Convenience Meats
- Figure 3-3: Share of U.S. Refrigerated Processed Meats Market by Product Category, 2001 (percent): Lunchmeats/Lunch Kits, Frankfurters/Dinner Sausage, Breakfast Meats, Convenience Meats
- Almost 90% of U.S. Households Use Lunchmeats
- Table 3-7: Overview of Meat Product Usage, 2001 (percent): 5 Classifications
- Supermarkets Account for 80% of Total Retail Sales
- Figure 3-4: Share of U.S. Refrigerated Processed Meat Sales by Retail Outlet, 2001 (percent): Supermarkets, Other Grocery/Food Stores, Other
- Supermarket Sales Approach $10 Billion in 2001
- Table 3-8: U.S. Supermarket Sales of Refrigerated Processed Meats, 1997-2001 (dollars)
- Lunchmeats and Lunch Kits Account for 40% of Supermarket Sales
- Table 3-9: Share of U. S. Supermarket Sales of Refrigerated Processed Meats by Product Category, 1997 vs. 2001 (percent): Lunchmeats/Lunch Kits, Frankfurters/Dinner Sausage, Breakfast Meats
- Figure 3-5: Share of U.S. Supermarket Sales of Refrigerated Processed Meats by Product Category, 2001 (percent): Lunchmeats/Lunch Kits, Frankfurters/Dinner Sausage, Breakfast Meats
- Use Highest in the South
- Table 3-10: Selected Meat Products: Consumer Usage Indices by Region, 2001 (index): 5 Classifications
Factors to Market Growth
- Convenience Meats Category Takes Off
- Dinner Sausage Sales Also Boost Overall Market
- Consumers Demand Tasty, High-Quality Products
- Convenient Products Appeal to Busy Consumers
- Refrigerated Processed Meat Products Receive Heavy Advertising
- Figure 3-6: Projected U.S. Retail Sales of Refrigerated Processed Meats, 2001-2006 (dollars)
- Figure 3-7: Projected U.S. Retail Sales of Refrigerated Processed Meats by Product Category, 2001-2006 (dollars): Lunchmeats/Lunch Kits, Frankfurters/Dinner Sausage, Breakfast Meats, Convenience Meats
Projected Market Growth
- Sales Hit $17 Billion in 2006
- Table 3-11: Projected U.S. Retail Sales of Refrigerated Processed Meats, 2001-2006 (dollars)
- Lunchmeat and Lunch Kit Sales to Reach $5.8 Billion in 2006
- Table 3-12: Projected U.S. Retail Sales of Lunchmeats and Lunch Kits, 2001-2006 (dollars)
- Frankfurter and Dinner Sausage Sales to Reach $5 Billion in 2006
- Table 3-13: Projected U.S. Retail Sales of Frankfurters and Dinner Sausage, 2001-2006 (dollars)
- Breakfast Meat Sales to Reach $4.4 Billion in 2006
- Table 3-14: Projected U.S. Retail Sales of Breakfast Meats, 2001-2006 (dollars)
- Convenience Meat Sales Exceed $2 Billion in 2006
- Table 3-15: Projected U.S. Retail Sales of Convenience Meats, 2001-2006 (dollars)
- The marketers
The Marketers
- Hundreds of Marketers
- Table 4-1: U.S. Market for Refrigerated Processed Meats: Selected Marketers and Brands
Marketer and Brand Shares
- Methodology for Market Share Estimates
- Kraft Controls One-Fourth of Mass-Market
- Sara Lee Places Second
- ConAgra Captures Third Place
- Smithfield and Hormel Tie for Fourth Place
- Bar-S Ranks Sixth
- Three Marketers Earn a 2% Share Each
- Four Marketers Earn a 1% Share Each
- Figure 4-1: Marketer Shares of U.S. Supermarket Sales of Refrigerated Processed Meats, 2001 (percent): 6 Marketers, Private Label, All Others
- Private Label Controls 11% of Supermarket Sales
- Oscar Mayer Is #1 Brand of Refrigerated Processed Meat
- Figure 4-2: Brand Shares of U.S. Supermarket Sales of Refrigerated Processed Meats, 2001 (percent): 6 Brands, Private Label, All Others
- Table 4-2: Marketer/Brand Shares of U.S. Supermarket Sales of Refrigerated Processed Meats, 1999-2001 (percent): 13 Marketers/23 Brands, Private Label, All Others
- Table 4-3: Brand Shares of U.S. Supermarket Sales of Refrigerated Processed Meats, 1999-2001 (percent): 10 Brands, Private Label, All Others
Competitive Overview
- Billion-Dollar Food Companies Control Meat Products Market
- Smaller Marketers Grow Through Acquisition
- Marketers Offer Convenient Products
- Marketers Heavily Promote Their Products
Competitive Profile: Bar-S Foods Co.
- Largest U.S. Jumbo Franks Processor
- Bar-S Is #3 Brand of Frankfurters
- Bar-S Favors Internal Growth Over Acquisition
- Food Safety Is #1 at Bar-S
- Better Barbeque Meal Solutions Debuts in 2000
Competitive Profile: Bob Evans Farms, Inc.
- 2001 Sales Exceed $1 Billion
- #2 Marketer of Breakfast Sausage
- Bob Evans Builds New Distribution Center
Competitive Profile: ConAgra Foods, Inc.
- #1 U.S. Meat Processor
- ConAgra to Concentrates on Its Foods Business
- ConAgra Lunchmeats Provide "Deli Experience"
- ConAgra Revives Ailing Healthy Choice Line
- Lunch Makers Is #2 Brand of Lunch Kit
- Successful Baseball Tie-In for Armour Hot Dogs
- Hebrew National Hot Dogs Appeal to Discriminating Consumers
- ConAgra Fields "Guaranteed Tender" Entries
- KC Masterpiece BBQ
- A Major Player in the Convenience Meats Category
- ConAgra Beef and Pork Operations on the Block?
Competitive Profile: Farmland Industries, Inc.
- #1 U.S. Agricultural Cooperative
- Farmland Focuses on Case-Ready Market
- Ribbits Barbecue Pork Tips Debut in August 2001
- Farmland Extra Tender Fresh Pork Debuts in June 2001
- Convenience Ground Beef Product Debuts in May 2001
- Family Entrees Target Families of Four
- Food-Safety Partnership with DMV
Competitive Profile: Hormel Foods Corp.
- #1 U.S. Turkey Processor
- Hormel Acquires The Turkey Store in 2001
- Jennie-O Foods Aims to Boost U.S. Turkey Consumption
- Hormel Adheres to Six-Point Strategic Plan
- "Today's Flavor" Campaign Debuts in April 2001
- Hormel Cracker Add-Ons Target Adult Snackers
- Hormel's Black Label Is #2 Brand of Bacon
- Hormel Leads Branded Convenience Meats Category
- Always Tender Line Consists of Juicy Pork Products
- Hormel Fully Cooked Entrees
Competitive Profile: Johnsonville Sausage Co.
- #1 U.S. Marketer of Fresh Sausage
- A Family-Owned Business
- #2 in Dinner Sausage Market
- Bratwurst Is Johnsonville's Specialty
- Official Bratwurst of Lambeau Field
- #4 Brand of Breakfast Sausage
Competitive Profile: Kraft Foods, Inc.
- #1 U.S. Food Company
- Spun Off by Philip Morris in 2001
- Oscar Mayer Is Ninth-Largest Meat Processor
- Kraft Capitalizes on Deli Trend
- Oscar Mayer Launches Ham Advertising Campaign in 2000
- #1 in the Lunch Kits Market
- Kraft Successfully Extends Lunchables Line
- Lunchables Raises Nutritional Concerns
- Lunchables Internet Promotion Targets Children
- Oscar Mayer Develops Optiform Listeria Control Model
- Louis Rich Carving Board Is Kraft's Convenience Brand
- Louis Rich Carving Board Now Offers Beef
Competitive Profile: Sara Lee Corp.
- Diversified Company Enjoys Sales of $18 Billion in 2001
- Sara Lee Acquires FHS in 2001
- Sara Promotes Lunchmeats in Supermarket Deli Departments
- Bryan Foods Introduces Classic Deli Lunchmeat Line
- New Ball Park Varieties Appeal to Kids and Kosher Aficionados
- Ball Park Targets Hispanics in 2000
- Hillshire Farm Is #1 Dinner Sausage
- Integrated Marketing Campaign Debuts for Hillshire Farm
- Jimmy Dean Also Banks on Integrated Marketing Campaign
- Jimmy Dean Is #1 Brand of Breakfast Sausage/Ham
- Jimmy Dean Launches Dinner Sausage
- Sara Lee Buys Share of Johnsonville Sausage in 2000
- Sara Lee Fields Bryan Convenience Meats
Competitive Profiles: Smithfield Foods, Inc.
- #1 Hog Producer
- Aggressive Acquisitions Strategy Characterizes Smithfield
- Smithfield Expands into Beef Industry
- Smithfield Actively Pursues "Case-Ready" Agenda
- Lean Generation Line Competes in Heat-and-Serve Segment
- John Morrell Fields Wide Range of Convenience Products
- Smithfield Foods Wants Brand-Name Recognition for Its Products
- Smithfield Faces Local Friends and National Foes
Competitive Profile: Tyson Foods, Inc.
- World's #1 Meat Processor
- Tyson's IBP Subsidiary Is World's #1 Fresh Beef Producer
- IBP's Foodbrands Division Fields Convenience Products
- IBP Acquisition Allows Tyson Foods to Grow
- Thomas E. Wilson Poised to Become Leading Convenience Meat Brand
- Beyond Case-Ready
- New Thomas E. Wilson Heat-and-Serve Entrees
- IBP Pays EPA Penalties in 2001
- Marketing and Retail Trends
Marketing and New Product Trends
- Premium Lunchmeats
- Dinner Sausage Line Extensions
- Gourmet, Ethnic, and Poultry Dinner Sausages
- Precooked Bacon
- Flavored Breakfast Sausages
- Pre-Marinated Meat Products
- Heat-and-Serve Entrees
- Heat-and-Serve Barbecue
- Table 5-1: U.S. Market for Refrigerated Processed Meats: Selected New Product Introductions, 2000-January 2002
Advertising Expenditures
- Ad Expenditures at $185 Million in 2000
- First-Place Sara Lee Foods Spends $50 Million
- Kraft Foods Places Second with $33 Million
- Third-Place Hormel Spends $24 Million
- Two Poultry Producers Place Fourth and Fifth
- ConAgra Spends $13 Million
- Six Marketers Spend Approximately $3 Million-$8 Million
Advertising Positioning
- Integrated Campaigns Capitalize on Brand Strengths
- Individual Promotions for Line Extensions
- Summertime Is Grilltime
- Tailgating and Halloween
- Back-to-School Campaigns
- Sports Links
- Breakfast Meat Marketers Stress Versatility
- Joint Promotions
- Speed and Ease Figure Prominently in Convenience Meat Ads
Consumer Promotions
- Coupons
- Sweepstakes and Gift Offers
- Recipes and In-Store Sampling
- Corporate Citizenship
- Examples of Consumer Promotions
At the Retail Level
- Grocery Stores Account for Lion's Share of Retail Sales
- Supermarket Display of Refrigerated Processed Meat Products
- Supermarket Display of Convenience Meats
- Supermarket Selection Proliferates
- Premium Products Available Through Catalog and Internet
- The Consumer
Overview of Consumer Demographics
- The Simmons Survey System
- 87% of Households Use Cold Cuts
- Penetration Rates in the 70s for Frankfurters and Sausage
- Household Levels of Heavy Usage
- Children and Processed Meats
- A Blue-Collar Streak
- Minorities as Prime Consumers
- Favorites Are All-Beef Frankfurters and Ham Cold Cuts
- Upscale and Student Consumers for Turkey Cuts
- Table 6-1: Overview of Meat Product Usage, 2001 (percent): 31 Classifications
- Table 6-2: Usage Levels for Selected Processed Meat Segments, 2001 (percent): 9 Classifications
- Table 6-3: Household Usage Levels for Selected Processed Meat Segments, 2001 (percent): 12 Classifications
- Table 6-4: Top Demographics for Heavy Use of Processed Meats, 2001 (percent): 30 Classifications
- Table 6-5: Consumer Preferences by Variety of Meat: Selected Processed Meat Segments, 2001 (percent): 12 Segments
- Table 6-6: Top Demographics for Processed Meats: By Variety of Meat, 2001 (percent): 26 Classifications
Overview of Brand Demographics
- 27% of Households Use Oscar Mayer Cold Cuts, Ball Park Frankfurters
- Patterns and Variations
- Table 6-7: Consumer Preferences by Brand: Selected Processed Meat Segments, 2001 (percent): 39 Classifications
- Table 6-8: Prime Demographics for Use of Processed Meats: By Brand, 2001 (percent): 31 Classifications
Appendix I: examples of consumer advertising and promotions
Appendix II addresses of selected marketers
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