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We want to market more beef

A&W explains its marketing plan to producers

SSGA director Henry McCarthy (l), Marty Seymour, Canadian Western Agribition CEO with Trish Sahlstrom.

It was fun while it lasted — the new burger family served in tidy little foil bags; the frosted mug of root beer; the carhops delivering orders to the window. It was 1956 and A&W came onto the Canadian food-service scene with a flare that captured the fancy of the postwar generation.

By 1972, when Unilever purchased A&W Canada from its U.S. parent company, the chain was tired looking and the shine had worn off sitting in too-hot or too-cold cars waiting for food. A new generation of customers was drawn to a growing field of competitors offering quick service with a sit-in option.

“We don’t want to be in a position like the 1970s with business failing because the world is changing around us and we don’t sense it or do everything we can to respond to keep the business relevant,” Trish Sahlstrom, A&W Canada’s vice-president of purchasing and distribution, told an attentive audience at the Saskatchewan Stock Growers Association’s summer annual conference.

That’s the whole point behind A&W’s better beef campaign promising that beef for its entire burger family is from cattle raised without the use of steroids or hormones and that additives and preservatives aren’t used in making the patties.

Since 1973, the company has been using the Trendsitions decision-making model that includes SWOT (strength, weakness, opportunities, threats) analyses as part of an ongoing strategic renewal process geared to managing future change rather than reacting to change as it happens.

It guided A&W from near demise in the 1970s as 300 drive-ups were eventually replaced by a mix of restaurants in shopping malls, free-standing restaurants with drive-throughs, and the latest urban restaurants in downtown city core areas to meet varying needs of consumers in 812 locations across Canada. A&W’s famous root beer has also been made widely available through other retailers.

Now, Trendsitions is pointing to a shift in consumers’ attitudes around the food they eat.

“There is a wariness, a sense of distrust with science and big business,” Sahlstrom says. “Bad-news stories have had an impact on how consumers perceive and feel about the food they eat and who they look to and trust. They want to know that their food hasn’t been changed without their knowing. They don’t want to feel tricked.

“We started with beef because that’s who we are. We are a beef burger business and beef, at this point in time, is the most challenged, under-attack ingredient on our menu. Are there others? You bet. Are we going to have to figure out what to do about that? You bet.”

Coming out of the gate, the response from consumers has been extraordinarily positive, she says. A&W is selling more beef and people are saying they have returned to eating beef burgers.

A and W storeResponse from beef producers was equally swift, but not as encouraging. The campaign drew widespread criticism on several points they were quick to reinforce at the meeting. A silent minority confided that they’re all for A&W’s strategy if it boosts beef consumption.

Many take issue with the term “better beef” because it implies that beef raised differently is somehow inferior.

Most are discouraged that A&W turned to sourcing beef from the U.S. and Australia, with only one Canadian supplier, Spring Creek Ranch at Vegreville, Alta., in the loop.

As Sahlstrom explains it, the latter was an unintended consequence and A&W’s hope is to be able to someday return to all Canadian beef that meets company specs.

“We knew that we would be challenged to find beef that met those specs for a company as large as ours and spread from coast to coast, but we knew that many producers raise animals this way. The question was, how do we access it? We knew it would cost us more, but we didn’t think it wouldn’t be available.

“In fact, we encountered a great deal of difficulty in finding supply or interest in supplying, so we bought what we could and went outside the country for the balance,” Sahlstrom says, adding that she rarely hears feedback from consumers disappointed that A&W had to go out of country or that the Canadian beef industry couldn’t see the opportunity.

She says Spring Creek has been a fantastic partner in helping grow Canadian beef content. Although she has fielded calls from producers who would like to bring naturally raised beef to market, it’s not possible to take them up on the offer one by one because A&W’s supply has to be traceable from the ranch through the production chain. That means animals have to be segregated and tagged to retain their identity through the feedlot and a federally inspected packing plant.

Melissa Downing, co-ordinator of the Spring Creek program, says demand for Spring Creek beef from the company’s retail and restaurant customers, including A&W, is exceeding supply and she welcomes the opportunity to bring more ranchers on board.

Spring Creek has built a network of co-operating ranches across Western Canada since introducing the brand in 2003. There are requirements for eligibility and Downing prefers to discuss those on an individual basis with interested producers because if they aren’t already eligible, she’s more than willing to work with them toward meeting the requirements.

Spring Creek purchases calves outright to finish at Highland Feeders. Finished cattle are shipped to the JBS plant at Brooks at designated times for processing and distribution of the beef.

Currently, there are few options available to producers wanting to market naturally raised beef, Sahlstrom says. She sees that on the verge of changing as more retailers and food-service companies are already making naturally raised beef available and looking to include higher percentages of it in their beef offerings.

“We’ve had conversations with large food-service and grocery retailers in Canada about how we can help support and grow this. What hasn’t been established to the extent it needs to be is a sense that there is a business case there and this is an important option to make available. We know we have a responsibility to create the pull in the marketplace that helps to create the business case that encourages industry to invest in the process necessary to bring beef with this spec to the market.”

Managing future change

A&W commissions research firms to select representative samples of the population for polling. It was consumers who called out steroid free, antibiotic free and hormone free as being most important for meat in their burgers, however, Sahlstrom says, she doesn’t know exactly where consumers got those ideas to start with.

Each of the top three were important to 62 to 66 per cent of respondents in the 2013 survey, which was up from 53 to 60 per cent in the 2011 survey.

Other beef characteristics from a long list identified by consumers in previous research that made the top 10 survey, along with the percentage of respondents who said they were important in 2011 and 2013 included: burgers made from lean meat (54 per cent, 2013 only), from animals treated humanely (54 per cent, 2013 only), naturally raised (45, 48 per cent), free range (35, 39 per cent), locally raised (35, 40 per cent), grass fed (34, 45 per cent) and vegetarian fed (26, 32 per cent).

“When we asked what it would mean if we could assure them our beef in burgers met those (top three) specs, they said that would be better and when we sampled those burgers to them, they said they tasted better. They said they felt better about eating them and they said they’d buy them more often. From there was born our A&W better beef campaign. We were using their term when we did the launch,” Sahlstrom says.

As the campaign rolled out, consumers started speaking specifically about what they appreciated and the company realized that the overused and vague word “better” wasn’t important to consumers or necessary.

When challenged by a beef producer about sharing the responsibility of helping consumers make informed, rational decisions, Sahlstrom offered a differing perspective.

“Our business isn’t about changing people’s minds about what they eat or would like to eat because consumers are a lot smarter than that and they’re gonna make decisions and choices themselves and if you don’t figure out a way to respond and make yourself relevant to what they’re asking… you’re going out of business.

“So there are times when absolutely I would like to think that we let the producers have the voice in talking about what’s going on. There is plenty of science out there to be had in the battle on what’s right or wrong. It’s not our responsibility and it’s not what our restaurants across Canada are trained on or educated to do. Within the evaluation of what’s the right thing to do for our business and for corporate responsibility, it is to try to deliver for consumers what they are asking.

“For now the thing that’s important to us is bringing people back to beef and having them enjoy it.”

From an animal health and welfare stand, A&W fully supports use of antimicrobials to treat ailing animals. The company’s specs only prohibit the use of feeding ionophores to promote growth, though some of their suppliers have more stringent guidelines.

Sahlstrom looks forward to the work A&W will be able to undertake as a member of the Canadian Roundtable on Sustainable Beef.

“We’ve been on many ranches in Canada over the past couple of years and have seen fantastic practices and great standards. Canadian producers are great stewards of the land and their animals. We need to find a way we can communicate this and one way is to create a definition (of sustainable beef) and thereby get recognition for these practices.”

The A&W presentation is posted at Saskatchewan Stock Growers Association website. For more information about Spring Creek’s program, contact Melissa Downing at 780-436-0335.

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