In today’s Beef Buzz, senior farm and ranch broadcaster Ron Hays speaks with John Sitka of Certified Angus Beef about the brand’s sales performance, consumer demand and the importance of maintaining quality standards as the beef industry navigates record-high prices and limited cattle supplies.
Sales Stay Strong Despite Market Challenges
Certified Angus Beef is halfway through its fiscal year, and while the cattle industry continues to face tight supplies and historically high prices, Sitka said the brand’s sales have remained remarkably steady. “It is really exciting where we’re at sitting here mid-year for our business,” Sitka said. “With everything going on, with high prices and tight supplies, the fact that we are running right along where we were a year ago in terms of tonnage, I think, is pretty exciting.”
He said foodservice sales continue to lead the way. “Our foodservice business is doing extremely well,” Sitka said. “We’re actually up about two and a half to 3% at foodservice, restaurants and so forth.”
Retail sales have softened somewhat as higher prices have reduced promotional activity. “Our retail business, given prices, we haven’t seen quite the feature activity or the volumes movement of product when it is on features we have in the past, so we’re down about 3% at retail,” he explained.
International markets have presented the greatest challenge. “There’s been so many dynamics, whether it’s prices, tariffs, the conflicts in the Middle East and so forth, that have just brought a lot of uncertainty about our international business,” Sitka said.
Even so, he noted that Certified Angus Beef is selling more product from each qualifying carcass. “The fact that our certified numbers are down about six and a half to 6.9% and our sales are flat speaks pretty good about we’re selling more of that carcass on a per-head basis,” he said. “Our utilization is up, and at these prices, demand has been awfully resilient since consumers have really bought in on this idea of a quality product being worthwhile.”
Consumers Continue Choosing Quality Beef
Despite record retail prices, Sitka said consumers continue to prioritize beef, particularly premium products. “Without a doubt, it seems beef is winning when it comes to the consumer,” he said. “Even at these prices, they continue to show up and pay a higher price.”
He said Certified Angus Beef is also benefiting from consumers purchasing more value-oriented beef products. “We offer ground beef, we offer other items too that can be bought more at a value, and we’re seeing the number of consumers shift that direction,” Sitka said. “That’s become a focus of our program and our brand as well.”
Listening to Consumers
Sitka said Certified Angus Beef relies on several sources to understand consumer behavior and guide marketing efforts. “We obviously rely on a lot of the data that NCBA would put out there through the checkoff in terms of understanding consumer trends and dynamics,” he said. “We also do a lot of online surveying of our own to understand what the consumer thinks about our brand.”
Just as important, he said, is feedback from retailers and restaurant partners. “You really need to understand what consumers say to know kind of where you want to head,” Sitka said. “But ultimately, it comes down to what do consumers do.”
That combination of research and real-world observations helps the organization better understand customer expectations. “That balance of looking at what the data says and what our licensees’ experiences are allows us to zero in on what we feel the Certified Angus Beef consumer expects from us to continue to buy our product,” he said.
Quality Standards Remain the Foundation
Sitka credited the brand’s long-standing quality standards for building consumer trust over nearly five decades. “Our 10 specifications for quality have been the key to this brand’s resilience and, I think, steadiness in this market,” he said. “Now is not the time to compromise quality.”
He said customers have consistently rewarded that commitment. “The consumer has told us the fact that we’ve held quality so steady for so long is why they trust the brand and why they see more value in that brand in relation to the higher price that we’re asking them to pay,” Sitka said.
While the industry continues adapting to larger carcass weights and changing production economics, Sitka said protecting consumer confidence remains the top priority. “It’s not easy, but it is important to stay disciplined in making sure we never compromise consumer trust in our brand,” he said.
The Beef Buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Ag Network and is a regular audio feature found on this website as well. Click on the LISTEN BAR above for today’s show and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
