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It's no secret. Consumers want tender, high-quality beef on a consistent basis. And many are willing to pay for it, according to a Kansas State University Research and Extension study called "Valuing Beef Tenderness." "Based on other studies, we know tenderness is an important meat quality attribute to consumers," Ted Schroeder, K-State agricultural economist, said. "It was our focus to determine if consumers who desire this value would pay a premium for the improved attributes." In a two-part study conducted in three Midwest urban retail grocery stores, 313 customers were tested for their preference of tender, versus tough steak in a taste sample. The first group did not know which of the selections was tender, while the second group got to see labels, said agricultural economist James Mintert. "This study was just one piece of the bigger research picture," Schroeder said. "It has been picked up by a lot of folks and used to increase incentives for quality labeling. The research provided motivation for further studies and was a catalyst to get the ball rolling on other kinds of tenderness projects." According to results released to the industry last year, 69 percent of the participants preferred the tender selection when relying only on their own taste. But 84 percent preferred the tender steak when the choices were labeled. Providing consumer information affected shoppers' choices, Schroeder said. "Labeling helps, as indicated by the study," he said. "Bottom line: Telling consumers about the product's quality on the package helps get the message across." Even though a majority of consumers preferred the tender steaks, not all were willing to pay extra for them. Researchers said this most likely reflects those with high expectations for tenderness. "This is a sign that a significant proportion of the population expects steak to be tender and palatable," Mintert said. "They do not anticipate paying extra for what should already be good." In the first group, 36 percent said they would pay more to obtain a steak classified as "guaranteed tender." In the second group, who saw labels, 51 percent were willing to pay a premium. "This is the take-home message: Producers must step beyond the average consumer and focus on the segment willing to lay down cash for the labeled product," Mintert said. "Producers just can't leave this money on the table. They must find ways to capture this market." In an experimental auction, the researchers found that the actual mark-up amounts consumers were willing to pay also varied with the two groups. The average acceptable premium was $1.23 per pound in the first group, compared to $1.84 per pound with the informed consumers. When adjusted for differences in the demographics of the people in the two groups, the value difference created by labeling was an 82 cents per pound increase. "This is a significant amount of money when it is added to all meat cuts on a carcass for which tenderness matters," Schroeder said. "Once we have determined the premium consumers are willing to pay for guaranteed tender steak, then firms that potentially want to adopt branded, assured-tender products will have an idea of how much additional cost they can put into processing and marketing the product." The study already is opening the door for more effective marketing practices, and many companies are rushing to accommodate consumers, to gain market share. "A branding initiative does not have to be geared for every consumer," Schroeder said. "Instead, it must find a certain set of consumers to support it with a combination of different individual products. It goes back to the philosophy of giving people what they want." The industry is developing various technologies for identifying and packaging tender cuts, Schroeder said. New cooperative alliances also plan to base part of their value system on tenderness traits. Since USDA quality grading standards inadequately identify meat tenderness, many argue for implementing a new guideline system on which to base the pricing scale, Schroeder said. Offering guaranteed-tender labels and perhaps mechanically tenderizing tough products would give consumers different options at the meat counter. © |
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