Excellent Response to Retail Beef, Pork Promotion in Peru

While Peru has been a reliable destination for U.S. beef variety meat for several years, its booming economy and growing middle class have created a broader range of opportunities for U.S. beef and pork. In March, USMEF partnered with Tottus Supermarkets in Lima for in-store tasting promotions designed to familiarize more customers with the attributes of U.S. red meat. Support for the promotional campaign was provided by the Pork Checkoff and the Beef Checkoff Program.

Tottus Supermarkets, a subsidiary of Chilean retailer Falabella, began operations in Peru in 2002. It now has 16 stores in Lima and another 16 in the cities of Chiclayo, Trujillo, Ica, Piura, Chimbote and Arequipa. Tottus is Peru’s third-largest supermarket chain with a market share of about 15 percent.

Tottus was the first Peruvian supermarket chain to promote U.S. pork in its stores and last year decided to import U.S. beef and pork directly, without the aid of a distributor. Its goal was to increase total sales of U.S. meat and expand the number of stores in which it is offered (currently limited to four stores in Lima).

A customer samples U.S. pork and beef at a Tottus Supermarket in Lima

For the March promotion, USMEF focused on two Tottus premium stores in Lima - Las Begonias and Jockey Plaza. In-store tasting demonstrations were held each Friday and Saturday in March to educate customers and differentiate the quality of U.S. beef and pork. Beef cuts featured included ribeyes, striploins, short ribs, outside skirt, knuckle, tri-tip and ground beef, while the pork promotion featured chops, ribs and loins. Tottus offered price discounts throughout the month at all four of its Lima locations that sell U.S. meat products. At the two stores where demonstrations were conducted, discounts were increased on days with in-store promotions. The results were impressive – total March sales volume in the two participating stores offering discounts on U.S. meat increased 21 percent from the previous month. However, in the Las Begonias and Jockey Plaza stores holding tasting demonstrations in conjunction with the discounts, sales jumped 150 percent.

“We were pleased to see strong sales increases at all the Tottus locations that offer U.S. beef and pork,” said Jessica Julca, USMEF South America representative. “But the results clearly show an even greater impact when the promotional effort includes product tastings conducted by a demonstrator who is able to showcase the items and share valuable product information with customers at the point of sale.”

U.S. pork exports to Peru are essentially in their infancy, and this was the first-ever retail promotion of U.S. pork. Last year pork and pork variety meat exports to Peru totaled 984 metric tons valued at $2.7 million – increases of 96 percent and 88 percent, respectively, over 2011. Through February, exports are ahead of the 2012 pace in volume but lower in value.

Peru has been a mainstay market in South America for U.S. beef variety meat items such as livers and hearts, but has recently shown a growing appetite for muscle cuts. Exports in 2012 reached 12,887 metric tons valued at $29.7 million. Through February of this year, exports totaled 1,875 metric tons valued at just under $4 million – up 10 percent in volume but 3 percent lower in value compared to last year’s pace.