Carol M. Bareuther
A marketer that got his start in the 1950s once said if someone told him single-serve bottled water or bags of chopped lettuce would sell, he would have answered ‘baloney’. Today’s supermarket deli meat case isn’t your grandma’s. Convenience, the driver behind bottled water and bagged salads burgeoning into billion-dollar businesses, is one factor shaping the category’s offerings. There are many others too, from new flavors to better-for-you products and everyday to special occasion entertaining. Capitalizing on all these ingredients can help operators get the biggest bite in sales from this cornerstone deli category.
“Deli meat has been a very strong category since the onset of the pandemic,” says Anne-Marie Roerink, principal, at 210 Analytics, LLC, a market research firm headquartered in San Antonio, TX. “The pandemic trends are also affecting how people buy.”
During the latest 52 weeks ending March 27, 2022, deli meat generated $7.8 billion in sales, which was up 5.4% versus a year ago and 16.1% versus 2020, according to Chicago-based data insights firm IRI, as shared by Roerink. As such, deli meat is slightly bigger than pre-packaged lunch meat, which rung up $5.7 billion during the same period with a sales increase of 4%. However, for both, the dollar sales are inflation boosted. Deli meat is down 1.5% in units and 1.7% in pounds during the latest 52 weeks versus a year ago. Still, when compared to the pre-pandemic normal, pounds are 4.4% higher, signaling continued strong demand.
Here are five ways to drive sales of deli meats:
1. SELL CONVENIENCE
Since the pandemic, there’s been a larger demand for grab-and-go items or fresh, pre-sliced deli meats in sealed packages that consumers can take right off the deli shelf, says Stephen Docherty, marketing analyst for Phoenix, AZ-headquartered European Brands & Sigma Foodservice US, with brands that include Fiorucci. “As such, we’ve prioritized a full line of authentic Italian deli meats in this packaging format.”
Sales of pre-sliced items were increasing at a high rate even before the pandemic, adds Scott Bridi, founder of Brooklyn Cured, a small batch charcuterie manufacturer based in Brooklyn, NY. “We are launching five new items this year based on consumer trends and sales of successful items in the category, and one of these is a Pre-sliced Red Wine Beef Salami.”
Also, this year, Fratelli Beretta USA, headquartered in North Bergan, NJ, introduced two new conveniently diced pancetta products. One is regular pancetta, and the other is Italian-style smoked bacon. Both are sold in 4-ounce packs.
Late last year, Volpi Foods debuted a domestically-produced Spanish-style Jamon Serrano in a pre-sliced 3-ounce format, says Deanna Depke, marketing manager for the St. Louis, MO-based company. “The delicate product has distinct nutty notes derived from all-natural, Raised Responsibly meat that is aged for more than 12 months.”
The robust dollar and volume demand for deli meat is supported by delis around the country offering convenient grab-and-go and pre-sliced options, according to 210 Analytics’ Roerink. “While cut-to-order makes up 61.5% of total deli meat sales, the growth is in grab-and-go. This was the case pre-pandemic already, but it accelerated due to service counters closing and consumers emphasizing speed/minimal contact. Grab-and-go deli meat sales totaled $2.2 billion over the latest 52 weeks, which is up 125% over the pre-pandemic normal of 2019.”
2. STOCK BIG FLAVORS & BEST-SELLERS
Just as much as they want convenience, customers want diversity of choice based on feedback from retailers, says Brooklyn Cured’s Bridi. One area of choice is assorted flavors. “Unique flavor profiles are making a positive impact on incremental sales for retailers. New products we’ll start to ship nationally in June include a shelf-stable Black Truffle Salami Chub and two new flavors of Gilbert & Bernard Mousse, including a White Truffle Mousse. Truffles are growing in popularity, and we’ve recently found a truffle source that meets our culinary standards. It’s fun to taste and discuss the nuances between black and white truffles. Black truffles have a bold flavor that is earthy and deep, whereas white truffles are nutty with notes of caramel.”
Consumers are embracing bolder spice profiles. However, products don’t need to carry heat to be bold, says Volpi’s Depke. “We have seen an uptick in sales for Finocchiona, a fennel-rich Salame, Peppered Salame, coated with cracked black pepper as well as Spanish-style Chorizo, which holds rich notes of smoked paprika and pepperoncino flakes.”
Although bold and spicy flavors are the preferred ones by American consumers, we have noticed that the products’ natural aroma is now more appreciated rather than in the past, says Emanuela Bigi, marketing manager for Veroni USA, based in Logan Township, NJ. “This is because the American market is inclined to discover new products like our Italian Mortadella that stands out for a more natural and balanced taste.”
The powerhouses remained the powerhouses throughout the pandemic: turkey and ham represent about 65% of deli meat sales and 66% of pre-packaged lunch meat, according to 210 Analytics’ Roerink.
“Turkey is the best-selling deli meat,” says Mike Whitney, sales and marketing manager for McKenzie Country Classics, in Burlington, VT. “After that, it’s ham and roast beef.”
3. CATER TO BETTER-FOR-YOU-SEEKING CONSUMERS
Much like in the meat department, there is a certain group of consumers who seek out better-for-you options, whether this is better for them, the planet, the animal or the worker, according to 210 Analytics’ Roerink. While conventional deli meat makes up the bulk of sales, much like the meat department, production claims are making an appearance in the deli aisle and pre-packaged lunch meat, as well.
“We see consumers making health-conscious choices for themselves and their families. We’ve launched two new products that appeal to this customer: 100% natural pepperoni and soppressata charcuterie slices. These are an extension of our already existing Fiorucci-brand line featuring Abruzzese, hard salami and salami Milano. These products meet our consumer’s demands for pork that has never been treated with antibiotics, while being free of artificial flavors, colors, ingredients and preservatives all while containing no added nitrates or nitrites,” says European Brands & Sigma Foodservice US’s Docherty.
Consumers often equate healthfulness with sustainable practices when it comes to meat sourcing, Brooklyn Cured’s Bridi adds. “In addition to ABF (antibiotic-free), which has gained widespread acceptance over the last few years, we ensure that our meats are pasture-raised, and we collaborate with farmers that practice regenerative agriculture.”
Clear from first-party research of shoppers is that younger generations are placing a priority on animal welfare, says Volpi’s Depke. “Listed as a ‘top three’ purchase driver for both Millennials and Gen Z consumers, shoppers believe that animal welfare programs are paramount to crafting a cleaner, more premium deli meat.”
Sustainable packaging is part of the better-for-the-planet mix.
Veroni USA will introduce an antibiotic-free line that will come in an eco-friendly tray in June. It will include four variation options from salami to prosciutto and an antipasto. Last year, the company introduced its eco-friendly charcuterie line in trays made with 75% less plastic than the company’s traditional Veroni trays and with FSC (Forest Stewardship Council)-certified paper.
“As packaging plays a pivotal role, especially when it comes to the deli meats sector, we are committing to reduce waste by offering a solution that ensures the freshness of our deli meat and, at the same time, has a low environmental impact. For all our trays we use the modified atmosphere packaging (MAP) that perfectly preserves the charcuterie for several weeks,” says Veroni’s Bigi.
The focus on preventing food waste is growing bigger and bigger both from an environmental point of view, but also with an eye on the very high inflation in the marketplace. This has resulted in several package trends such as the mixed item pre-packaged tubs, allowing shoppers to still buy a small amount but have both ham and turkey or two different hams rather than having to buy two containers, according to 210 Analytics’ Roerink.
4. SERVE EVERYDAY SHOPPERS
Sandwiches and snacks are two daily deli meat-eating occasions for many Americans.
“Kids and adults alike being home more for lunch is one reason the deli meat category has been strong,” says Roerink. “While most kids are attending school in person again, many adults still work from home. In the February IRI survey of primary shoppers, only 33% of working adults never work from home, whereas 20% work from home at least three days a week. The survey found that aside from leftovers, sandwiches are the number one lunch option among people working from home at least one day a week.”
Use premium deli meats to create signature deli sandwiches, recommends Kimberley Parrales, marketing manager for Fratelli Beretta USA. Inspirational ideas on the company’s website include a Muffuletta, with thin-sliced Soppressata and Mortadella, plus fresh mozzarella and olive salad on crusty Italian bread as well as The Nonna, sliced Prosciutto and Parmigiana Reggiano with fresh arugula and balsamic glaze on Italian bread.
One of several new products introduced this year under the Fiorucci brand is a 6-ounce Sandwich Variety Pack, which features hard salami, pepperoni and Genoa salami. The company has also extended its nationally distributed 1.5-ounce Panino line, with the introduction of Genoa salami and mozzarella Panino in snacking and convenience sizes.
“There is more room to help consumers with fun at-home sandwiches or different applications of deli meats in other meal occasions, including breakfast, dinner, and snacks. Certainly, we’re seeing the little snack bento boxes with the deli meat cubes, but consumers can make their own snacks by just rolling up a slice or two of deli meat, as well,” says 210 Analytics’ Roerink.
5. MAKE ENTERTAINING EASY
Entertaining, either small or large gatherings, is still largely taking place at home. This is fueling demand for pre-made trays and platters as well as information to create charcuterie boards. Deli meats are the foundation of both.
“Instead of sending customers on a treasure hunt for ingredients, our Hormel Gatherings party trays make it easy for shoppers to entertain at home or grab something to go to someone else’s home for a party,” says Andrew Quinn, director of marketing for Hormel Foods, headquartered in Rochester, MN.
The company’s three-item party try line ranges from 28- to 39-ounces, and includes ham and turkey; hard salami and pepperoni; or hard salami and Genoa salami, each accompanied by cheese, crackers and one features the addition of Peloponnese pitted olives.
“The charcuterie category is growing all over the country,” says Evan Inada, brand manager and charcuterie director for Columbus Craft Meats, in Hayward, CA. “For example, five years ago not everyone knew what Sopressata was. Now it’s familiar, especially for Millennials who have a passion for food and flavors.”
The company is introducing three new flavors of its single-stick salami. Each is 8- to 9-ounces in size, in a natural casing for a more artisan feel, and with content on the packaging to talk about the edible natural casing as well as charcuterie board pairing suggestions. Flavors are Finocchiona Piccola, Sopressata Saporita, Cacciatore and Columbus’ original salame secchi.
A Charcuterie Party Tray, a 12-ounce tray serving Italian charcuterie, cheese, olives and breadsticks to share with at least five to six people, is the latest new entry from Veroni. Veroni partners with retailers to promote its products in-store such as using branded coolers that recreate a corner of Italy within the stores.
“As with all charcuterie products, a strong merchandising program is the backbone to pushing pandemic-era growth through this next year. Match in-store merchandising efforts with marketing campaigns to yield the best results. For example, melon and prosciutto in the summer months is a wonderful way to drive basket rings in June and July,” suggests Volpi’s Depke.
Encourage consumers to create their own charcuterie boards, recommends Roerink. “Aldi, for instance, created a whole endcap and social media campaign surrounding charcuterie. And of course, there is the fantastic ‘charc week’ by Central Market where instead of celebrating sharks, they celebrate all things charcuterie and deli meat. It’s events like these that bring unexpected delight and an unplanned purchase.”
Beyond just charcuterie, Roerink adds, “The future of deli meat is bright. It’s versatile, it’s cost-effective and innovation is driving new applications. Those are three very important drivers of growth in the current environment.” DB