MFA Incorporated
COUNTRY CORNER
Changing role of consumer driving beef industry change
By Chuck Lay, Today's Farmer editor

An electronic appliance in a Norwegian grocery store may prove to be an oracle. Beside the meat case in an Oslo store stands an informational kiosk hosting a variety of electronic functions. The kiosk looks vaguely like an automatic teller machine. A bar-code scanner is positioned at waist level. Just above it at eye level is a video screen. Daily, Norwegian consumers pick up packaged, branded meats from the refrigerated case, take a few steps to the kiosk and hold the package under the bar-code scanner. Within seconds, a digital video appears.

For the specific brand of meat at hand in this instance, the video features a weathered Australian cattle rancher standing on a hill overlooking his ranch. The videographer frames the rancher's head and shoulders in the soft, rich light just before sunset. The rancher, speaking directly into the camera (and looking straight into the consumer's eye), explains his operation's history, his practices and his goals for the future.

The camera then sweeps the Australian horizon, panorama-style, showing lush pastures occupied by contented cows slowly grazing. A voiceover explains the benefits of grass-fed beef and how cattle have nearly unlimited freedom to roam the ranch. "You're holding my guarantee in your hands," says the rancher. "It's Australian grass-fed beef raised for families like yours."

Even if trend adoption patterns don't hold true and we never see this level of consumer involvement at the grocery level, we'll see a variation. Either way, the kiosk offers a glimpse into our beef industry's future. Specific brands. Identity preserved. Trace-back potential to farm of origin. Structured supply chain. Everything people in the beef industry have been preaching.

For the most part, say industry analysts, June Cleaver has left the kitchen. Wally and the Beav have their own families, and they're awfully particular and demanding.

Welcome to the new marketing era of the U.S. food industry. It's an era defined by a change in power structure. Consumers have turned the tables on retailers. Consumers segment the food market with specific, individual demands. That's a radical change from the grocery-brand days of the '60s and '70s. In those two decades, consumers didn't really look at the food in groceries. They focused on corporate brands and fancy packaging, which was a marked change from the practices of their squeezing, poking and prodding parents.

The '80s changed the industry yet again with what is referred to as the Wal-Mart model. That model brought value to consumers through a retailer who anticipated consumer wants and needs. The practice allowed the retailer to call the shots in the production process. Processors responded if they wanted to be involved in the business. The models framed everyone as a customer, in an exclusionary policy toward suppliers.

All of this brought us today's scenario in which the specific, individual demands of U.S. consumers define sections and food offerings in grocery stores. It's an era of extraordinary influence. And, say food industry analysts, it's the natural evolution of a focus on information and a fixation on health and well-being.

As the industry analysts like to point out, even if consumers make an irrational decision, it's still a decision. And grocery stores are set up to give consumers what they want.

This gives perspective to prophetic beef industry mantras like "Easy to use and easy to choose." And it reinforces the National Cattlemen's Beef Association's fixation on the meat case and consumer as the future of a viable industry.

 NOVEMBER 2000
FEATURES:
Change is inevitable
Cattle and hog similarities
Cutting-edge cattle
Soybean diseases
Grain management
Agriculture's future
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