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Asking the experts on beef quality

Beef Quality Perceptions Audit of key market influencers in Asia and Mexico sets the stage for strengthening the position of Canadian beef.

As a major beef exporter, arguably no opinions of beef quality are more important for Canada than those held by meat experts in key international markets.

These are the meat company directors, beef importers and distributors and meat purveyors who have the dollars and powerful market influence to drive demand.

That's why when the Canada Beef Export Federation (CBEF) prepared to conduct benchmark surveys of beef quality perceptions, the focus quickly honed in on auditing the perceptions of these top-level players of the international meat trade.

"These people are the movers and shakers – collectively, they represent millions of dollars in trade," says Michael Young, CBEF vice president of international programs. "These folks are in the business of buying what sells in their marketplace, and they can buy beef from anywhere in the world. How they perceive beef quality and Canadian beef has a huge impact on the success of our industry."

Targeting top influencers

With funding support from the National Beef Industry Development Fund (NBIDF), the Federation undertook a Beef Quality Perception Audit (BQPA) in Japan, South Korea, Taiwan, Hong Kong/Macau and Mexico, to understand the current perceptions of beef quality and how the specific attributes of Canadian beef measure up. Over 700 meat experts took part in the BQPA study. A similar audit of over 200 US meat experts was also conducted in 2004 by the Beef Information Centre.

"The focus was asking the opinions of meat experts, of what they think and what their experience is with the imported beef they purchase to resell to their customers," says Young. The purpose was not only to gauge these opinions, but to provide a basis for identifying key knowledge and opportunity gaps that could be leveraged to improve the competitive position of Canadian beef.

"We believe Canadian beef is the best in the world and we believe that the value proposition that Canada brings to the worlds table is what the customer is looking for. Export success and prosperity depends on our ability to communicate this story and deliver the quality and service standards the customer is demanding. This research was important for us to find out how well our story is getting through, and in what areas we can strengthen our message.

"We're really looking for the key purchase decision drivers that will inspire disruption in the buying patterns of our customers. The reality is our sales growth will be at the expense of our competitors who have stepped up to the plate in our absence. The disruption of any established purchasing pattern requires a 'bigger better deal.' And in the meat business that means a combination of functional and emotional attributers that will consistently deliver a marketable advantage to the customer."

Strengthening Canada's story

The buyers, sellers and end-users who buy into the Canadian beef advantage become not only invaluable customers, but powerful message conveyors throughout key sectors of the markets they represent.

"These are the people who have the confidence of their values customers – they're the ones we have to convince," says Young. "For example, a retail distributor or retailer in Japan who has been in business for many years has very high regard in the market. When this company chooses Canadian beef as a supplier, it adds tremendous integrity, value and wisdom to our story. That kind of trust must be earned and it gets noticed and passed on through the retail and food service levels."

A benchmark of quality perceptions in each priority market is an important step to gain valuable insights into marketplace, particularly in the wake of the BSE crisis, he notes. "We know that the rules of engagement have changed and nothing will ever be as it was prior to BSE". This is challenge for the Canadian beef industry and the FEDERATION that we are aggressively pursuing together. This audit gives us a benchmark of where we're at today and provides pivotal and directional information for growth strategies and tactics that will deliver results.

"It tells us where we need to focus, how hard we need to focus, and where the competitive battlegrounds really are."

Rating beef attributes

The audit consisted of a blind survey, conducted by independent market research firms, with no indication it was delivered on behalf of the Canadian industry. The survey asked senior level meat experts about their experiences and preference with the beef they use in their business. The focus was on both quality attributes and quality defect in the marketplace.

Canada's Beef Grading system specifies the standards used for the quality assessments of carcasses that will be graded. Canada's top grades are (Canada A, AA, AAA and Prime). Canadian quality standards consider the following attributes to determine our top grades of beef: maturity, marbling score, meat and fat color and texture. These attributes were presented in this survey.

Among the key findings:

Meat colour. The vast majority, 92 percent of respondents prefer to purchase beef that is bright red in color. This is consistent with Canada's A grades minimum standard for meat color which is bright red only.

The survey indicated over 55 of respondents had experienced customer complaints regarding 'dark cutters' – the term for dark red or purplish coloured meat. The vast majority of respondents confirmed that they do not want to ever receive dark cutting beef – good news for Canada since dark cutting beef is not allowed in Canada's beef A grades. These results clearly indicate that dark cutting beef is a quality defect in the export market and Canadian color standards will provide a solution.

Fat colour. The majority 85 percent of respondents indicated they preferred to purchase beef that was selected to deliver white or light amber coloured fat, and would not include yellowish or slightly off colour fat. This is also consistent with Canadian standards that do not allow yellow fat in it's A grades.

Over half 56 percent of respondents have received beef with yellow fat that has caused them quality problems. "These results also confirm that yellow fat is a defect in the marketplace and Canadian standards would provide an advantage to those customers who have had issues with yellow fat from our competitors".

Beef texture. Firm muscle texture was also overwhelmingly preferred by 89 percent of respondents, with well over half 60 percent stating they had experienced problems with soft textured beef in the past. Firm beef texture only is also a characteristic of Canada A grades. "Firm textured beef is particularly important in the high end foodservice sector because soft meat will not hold its shape on the commercial grill and tends to loose its natural juices faster often resulting in the customer having a tough eating experience" says Young.

Marbling standards. The vast majority 86 percent of respondents agree that the marbling standards used by the US and Canada are important considerations for delivering consistent beef quality. Both Canada and the US use the same minimum marbling standards to measure our top 4 quality grades (A, AA, AAA, and Prime).

Quality standards. We were delighted to learn that overwhelmingly 94 percent of respondents interviewed agreed that "grading standards designed to consistently deliver beef with white or light amber coloured fat, bright red meat colour and firm muscle texture" would provide their company with a quality advantage.

"The overall results indicate that the Canadian beef brand will deliver outstanding quality in every box and that the Canadian beef advantage is demonstrable and important to the majority of our potential customers. This is important because talk is cheap and competition is fierce in the animal protein business.

"Our challenge is to build an effective communication strategy to build awareness and demand for Canadian beef based on Canada's leadership position in animal health and food safety systems, our clean environment and the outstanding quality that Canadian beef brings to the table."

Significantly, the audit confirmed the importance of the quality standards that characterizes Canadian beef and sets us apart from our competitors. Specifically, the USDA grading system currently permits dark cutters in its standard, select and choice grades, yellow fat is not considered a quality defect in the USDA grading system and slightly firm texture in choice grades and slightly soft texture in permitted in select grades. Results showed all of these attributes are important considerations and typical problems for customers. "We were not surprised to find out that the vast majority of customer does not want to deal with any of these quality defects in their beef mix," says Young.

"The survey reinforced that the little things that make the Canadian beef brand different are important to our priority markets," he continues. "This really jumped out at us as a positive point of differentiation. We need to build marketable equity in the Canadian beef brand and we want Canada to be known for leadership in animal health and beef safety systems, leveraging "Quality with Confidence" and our clean Canadian image."

Communicating the results

To harvest value from the audit, the Federation has a major, ongoing effort underway to share audit information back with customers, and to use audit results to fine tune marketing and strategic approaches. This is being accomplished through a series of demand building and differentiation seminars happening in all priority market in the fall of 2006 and the winter of 2007.

"The results are quite illuminating to the customers, because as far as we know this is the first time they've really been asked these questions in a structured audit," says Young. "It's something the Australians and the Americans haven't done yet we believe. Sharing the information back gives us a unique opportunity to communicate our message and improve perceptions of Canadian beef. We can show customers what quality attributes they've said are important, and reinforce that those attributes are exactly what the Canadian beef brand is delivering."

The survey itself helps set up the customer to draw this conclusion. For example a question near the end asks: If a program was offered to you that had the same marbling standards as the US, no dark cutting meat, always firm textured and with only white or light amber fat color would you consider such a program for your operation?

"Predictably their answer was yes 66 percent of the time," Young says.

"The point is to fully understand with the customer what the market is looking for and what the market is not looking for, present the features and benefits of the Canadian Beef brand and ask for the sale When we get the sale we invest in our partners business through demand building sales promotions and consumer marketing tactics engineered to create consumer demand and confidence in the Canadian beef brand."

"The audit confirmed the things we do right with our grading system are important, but we need stronger efforts to reinforce the entire value proposition which must be built on a solid foundation of confidence and trust in the Canadian Beef delivery system, from farm to market. The responses indicated that if we can communicate the value proposition better to the customer, they will want to buy from us. That's important for our whole delivery system to hear and to be proud off."

The National Beef Industry Development Fund (NBIDF) is a $9.25 million fund created through the investments of the governments of Canada, Alberta and British Columbia. It contributed to more than 120 research and development projects from 2002 to 2006, to support the competitiveness of the Canadian beef industry. More information is available at www.cattle.ca/NBIDF.

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