Father’s Day weekend boosts retail meat sales

The week ending June 21st was Father’s Day weekend and the results for the meat department, and beef in particular, were astounding.

Growth percentages for most of the proteins jumped back up Father’s Day weekend after tapering off for weeks (IRI).
Growth percentages for most of the proteins jumped back up Father’s Day weekend after tapering off for weeks (IRI).

The week ending June 21st was Father’s Day weekend and the results for the meat department, and beef in particular, were astounding.

The weeks leading up to the 2020 Father’s Day week were plagued with supply chain tightness and purchasing limits. However, the week of Father’s Day, the meat department had much improved its in-stock position, the widest assortment seen in weeks and purchase limitations were more the exception than the rule. However, prices remained highly elevated and that was the big unknown relative to the success of Father’s Day 2020. The second unknown was consumer engagement with foodservice, with restaurants in most parts of the country reopened, albeit with social distancing measures in place.

Despite prices and restaurant competition, the Father’s Day sales bump was much higher than the year prior, with sales gains for the week of June 21 of 31.9%. This marks the 15th week of double-digit gains since the onset of the pandemic. Much like Mother’s Day and Memorial Day, this shows a disproportionate bump for retail meat sales for the spring and summer holidays thus far.

Volume demand also saw a robust rebound and jumped 13.5% ahead of the same week last year. This was the highest volume gain since the second week of May. Despite this increase, the gap between dollar gains and volume growth sat a new record, at 18.4 percentage points. In part, Father’s Day spending may have driven the purchase of higher end items, as evidenced by the high dollar share of beef. But above all, prices remained highly elevated from the year prior.

Meat department gains

Total meat department sales came in at $1.48 billion for the week of June 21. Growth percentages for most of the proteins jumped back up Father’s Day weekend after tapering off for weeks. Beef and pork, in particular, did extremely well. Smaller proteins, including lamb and exotic, also saw a significant improvement over the week prior, whereas chicken and turkey were more in line with the gains seen the week of June 14.

The overall 31.9% meat department gain was fueled by double-digit gains for all proteins. The two smaller proteins, turkey (+20.6%) and lamb (+51.3%), had the highest percentage gains versus year ago, but beef easily had the highest absolute dollar gains (+$192 million), followed by pork (+$43 million) and chicken (+$36 million). Exotic meat sales gained just under $1 million or 43.4% versus the same week year ago.

What’s next?

The meat landscape continues to be in flux. Supply and demand in foodservice and food retailing has yet to find a new balance as consumer engagement continues to evolve.

The past few weeks have seen spikes in COVID-19 cases and hospitalizations in some regions that had previously relaxed restrictions. The new outbreaks are likely to impact business activities, restaurant engagement and shopper behaviors in those regions. These outbreaks are also likely to prompt the continuation of social distancing measures and behaviors in hard-hit states.

In IRI’s ongoing consumer sentiment tracking survey, the share of consumers more concerned about COVID-19 than the week prior is up from 15% to 22%. The Trump administration announced last week that it is preparing for a second wave of COVID-19 that could hit the country in the fall. Between the continued impact of COVID-19 and significant economic pressure, it is likely that demand for meat in retail will continue to track well above 2019 levels for the foreseeable future.

As consumers are getting fatigued with tried-and-true recipes, a major opportunity lies in providing tips, recipes and ideas on how to serve up something different. With grilling season officially here, the meat department has many opportunities to help consumers shake up their in-home cooking.

Next week’s report will cover the last week of June. Depending on the level of preparation, consumers may have started on their July 4th shopping. Independence Day is traditionally strong meat holiday and much like Memorial Day, about half of shoppers are expecting to celebrate the Fourth differently, with less travel and smaller celebrations.

View our continuing coverage of the coronavirus/COVID-19 pandemic.

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