What's driving consumer demand for pork?
As a result of the pandemic, the homemade meal is seeing a long-overdue resurgence. Kiersten Hafer, vice president of strategy and domestic market development for the National Pork Board, joins Ag Future to discuss how consumer demand for pork has expanded beyond bacon as people seek to refine their culinary skills.
The following is an edited transcript of the Ag Future podcast episode with Kiersten Hafer hosted by Tom Martin. Click below to hear the full audio or listen to the episode on Apple Podcasts, Spotify or Google Podcasts.
Tom: Welcome to Ag Future, presented by Alltech. Join us from the 2022 Alltech ONE Conference as we explore opportunities within agri-food, business and beyond.
The COVID-19 pandemic radically changed consumer trends and protein preferences, but is the swine industry ready to meet new demands from consumers? That's a question for Kiersten Hafer, vice president of strategy and domestic market development for the National Pork Board. In her 25 years in the industry, she's worked with retailers, agencies, brokers, food service operators, market researchers and consumer goods manufacturers.
I'm Tom Martin, and Kiersten is with us for this episode of the Alltech Ag Future podcast. Welcome, Kiersten.
Kiersten: Thank you.
Tom: Let's begin with that question. Has the coronavirus pandemic changed the way consumers grocery shop, cook and eat? Is the pork industry ready to meet new consumer demands that have grown out of the pandemic experience?
Kiersten: Yeah, absolutely. Consumers have evolved. They've not only had to change the way they shop, but they've changed how they interact with products. For the pork industry in particular, and as they think about shopping meat cases, we saw a lot of consumption. They moved further into the meat case. They became more knowledgeable. They tried more cuts. They became more educated about what we offer. That was really exciting for us. Not only that, but they gain more confidence purchasing our products online. A lot of people weren't going into stores. They weren't shopping in six different channels or outlets, and they really became more comfortable with shopping online. It's opened up a whole new consumer group to us.
Tom: Have sales aligned with that? Sales have increased?
Kiersten: They have. The meat department grew — everything grew, as you can imagine, over the last two and a half years, but pork in particular has done very, very well. People are looking for variety and versatility. With that new confidence and knowledge, they’ve gone deeper into the pork portfolio of products. They’ve gotten beyond bacon to a lot of our fresh products. They are coming back. They’re staying with us. They see the value of different cuts. They’ve made it a priority now to incorporate that variety into their diet.
Tom: It’s hard to imagine getting past bacon, but we’ve done it, haven’t we? One of the things that’s come out of this pandemic is home cooking. A lot of people are doing it. One big trend has been meal kits. Air fryers have been flying off the shelves, (as have) Instant Pots. How has that whole trend affected demand and sales?
Kiersten: It's really helped. Again, people want to cook, and they want to serve their families or put good things into their bodies, so they're looking for better ways, faster ways to do that. A lot of those appliances that you mentioned are certainly helping them to make cooking a lot more easy and manageable on a daily basis, especially because they're coming and cooking three meals a day at home now, right? They went from maybe eating out two out of the three meals a day, or if they're eating five or six times a day, you know, more than half was away from home. Now, a lot of the food consumption is at home.
Seventy-nine percent of consumers are still cooking at home as of April of this year. In the height of the pandemic, that was 85%. Prior to the pandemic, it was about 53% of dollars going to at-home consumption. So, those increased rates have stayed with us. They found ways to stretch dollars and budgets. And, you know, they found some enjoyment in it.
I think, as you continue to manage mealtime at home, you're going to be looking for easy ways to do that. Air fryers are great. I have a 14-year-old daughter who uses the air fryer every single day. You find younger folks in the household learning how to cook as well, in a safe way. I think it's really been a good trend that has brought a lot of opportunity to the meat case.
Tom: It sounds like it reached a peak and then leveled off a little bit below that. Do you anticipate that that level is going to be sustained over time? Are you all actively making sure that it does?
Kiersten: Yeah. There's a couple of components. There are certainly some uncontrollables, right? Inflation right now is forcing people to stay more centered at home. And for the foreseeable future, we believe that to be the case. There is still a desire to get out and go back to some of the pre-pandemic ways. There are things people can't replicate at home that they love eating out-of-home. So, there will be some tradeoffs, but overall, you know, folks have determined that they can do it. They're willing to do it. They found, maybe, more economical ways. You know, there might be some dayparts that recover slower than others. That's what we're really watching and trying to understand. Really, it depends on the generational cohort group.
As we think about business and industry staying-at-home and hybrid models, less return to work means less work lunches. The lunch occasion is one that may not rebound as fast as others and food service and far-away-from-home consumption. But essentially, we think that we have the ability to hold on to a lot of this momentum, and we know that because we are looking at how we're performing versus 2019, before the pandemic started. Pork is still more elevated in terms of sales and volume than it was pre-pandemic. It means that people are staying with us. They're continuing to cook at home. They're continuing that strong repeat rate.
Tom: You mentioned generations. I'm wondering: What are you seeing in sales trends among various generations?
Kiersten: We have a lot of data. We track a lot of information around what people are keeping on hand, what they're using. We'd like to understand: Are they buying to fulfill a specific need, or are they just pantry-loading? Essentially, it really does differ by cohort. But we see younger generations definitely getting deeper into our portfolio of products. They're using a lot of fresh product, which is really good. The processed side does very well. They love it. Who doesn't love bacon or sausage or ham? But they're really moving deeper into the pork set. I think that that will continue. They're getting into different cuts. They're using chops. They're using ribs, shoulders. We see some strong momentum there. With that comes the opportunity to serve them in a different way.
We're looking at how households are engaged and what sizes they're buying. Over the last couple of holidays, we saw smaller hams, for example. Smaller gatherings meant smaller portions. I think that really comes down to, as an industry — and retail, in particular — doing it with a lot of what they offer in terms of customizing for consumers what they buy within the butcher counters. You know, it could be that we see them stay more engaged with pork if they can get to some of those smaller pack sizes.
Tom: Has there always been something of a gap between consumers and pork producers? And if there has been, how can that be bridged?
Kiersten: I would say that, you know, it really comes down to (the fact that) the consumer’s a moving target, and it's an evolving target. We've learned a lot over the last two and a half years about consumer behavior. Everyone's trying to determine how much of what we saw is going to stick. You just asked me that question. You know, I wish I had a crystal ball. The reality is that sometimes it's hard to understand where the consumer is and what they want, and it's hard to be everything to all people. So, I think the real opportunity is to just deliver on quality and consistency in the marketplace so that the consumer has a great eating experience.
If we can bring that high-quality pork to market and tell our story and really help them understand where it comes from — because that younger generation does prioritize sustainability and animal welfare and understanding what goes into the products that they're buying. They want to believe; they want to get behind those causes. I think the biggest opportunity is to really bridge that gap and have producers help tell that story, from farm to product, and let consumers really understand the value of the product that they're buying.
Tom: Kiersten, you have a background in the retail and food service segments. I'm thinking of your years as vice president for marketing at Clemens Food Group. What sorts of insights from that experience do you now find useful in your work for the pork industry?
Kiersten: I wouldn't say it's “insights” as much as how to apply everything that we do at the National Pork Board. Having been on the other side of the table, and knowing how much comes at you in a day, you know, it's really important to prioritize the right things. And there are days that you don't have time to work ahead of the business. So, that's really, I think, the biggest opportunity, is for the National Pork Board to be working on things that perhaps the industry doesn't have a chance to think about day in and day out, to get ahead of it. How do we think about holding on to the e-commerce growth that we've accumulated during the last two and a half years? How do we think about unlocking growth potential for some cuts that were traditionally underdeveloped but grew during the pandemic?
So, I would say my experience and time leading that marketing organization is really leveraged into (asking questions like) what do we go focus on, and how do we do it in a way that doesn't duplicate what they're doing but, you know, adds some value to the way that they're going to be able to integrate it into their business? And then, (we have to) take it to them to act as that catalyst to getting them to market faster. You know, we're really trying to do risk for the industry, for retailers, for packer processors and producers. So, we're trying to build our base and bring more stability and get rid of a lot of the seasonality. I think that's really what I bring to the table, having sat on the other side of the desk.
Tom: Well, you're known, Kiersten, for this ability to sniff out potential. What kind of criteria do you look for?
Kiersten: I really depend on the data. I say that knowing that this business is about data. Data is an art and a science. I think, really, it comes down to the end user, which is the consumer. We look to them for opportunity. We look to them for patterns, and then we try to validate those multiple times to really understand: Is it something they're saying, but they're acting differently? Or is it something that, truly, they are voting with their voice and their dollars? If that's the case, then we follow that path. We continue to validate as we go. That gives us the strength and confidence to go further.
Not everything's a win. Not everything's a great opportunity. But I think it really comes down to the consumer as the ultimate decision-maker and the ultimate determination of whether or not we're successful as an industry. I really lean on understanding the consumer and figuring out how to relate to them in a way that they (can then) make that connection with our product and with our industry and with our farmers.
Tom: Are you able to take a raw data set and create a narrative out of the information?
Kiersten: Yeah, absolutely.
Tom: I think that that's key, isn't it? I mean, numbers are one thing, but telling the story with them is the whole purpose.
Kiersten: Absolutely. Yeah. Sometimes it's what the numbers don't tell you — it's what you don't see in the numbers that becomes the big opportunity.
Tom: Right. What important industry and market trends are you keeping an eye on right now?
Kiersten: We're watching everything. I mean, as you think about protein consumption and consumers wanting to eat to fulfill certain diets and routines, it really comes down to who we're competing against — any product that is a source of protein. How do we think about where they're sourcing? How they're sourcing? How many times a day they're sourcing? We want everything. We watch everything in the grocery store. We watch everything in food service, across the menu. We really want to understand how they're interacting and where the opportunity (lies) for us to meet them in their time of need. Really, it boils down to: How do we intersect (with them) when they're in their health and wellness journey? How do we intersect with them when they're thinking about sustainability and buying products that they believe in? As they think about just making mealtime happen today, where and how does pork show up in their life?
Really, it comes down to us not leading with what we have to tell them and the features and the benefits of pork. It comes down to us really understanding where they are and meeting the consumer where they are in their time of need. It's those natural intersections and opportunities to introduce pork as that protein.
Tom: All right, that's Kiersten Hafer, vice president of strategy and domestic market development for the National Pork Board. Thank you, Kiersten.
Kiersten: Thank you, Tom.
Tom: For the Alltech Ag Future series, I'm Tom Martin. Thank you for joining us. Be sure to subscribe to Ag Future wherever you listen to podcasts.