Love it, hate it, or laugh at it — at least it's inexpensive.
Sales of Spam — that much maligned meat — are rising as consumers are turning more to lunch meats and other lower-cost foods to extend their already stretched food budgets.
What was once cheeky, silly and the subject of a musical (as Monty Python mocked the meat in a can), is back on the table as rising costs turn people to the once-snubbed Spam, analysts say.
Food prices are increasing faster than they've risen since 1990, at 4percent in the U.S. last year, according to the Agriculture Department. Many staples are rising even faster, with white bread up 13 percent last year, bacon up 7 percent and peanut butter up 9 percent.
The price of Spam is up too, with the average 12-ounce can costing about $2.62. That's an increase of 17 cents, or nearly 7 percent, from the same time last year. But it's not stopping sales, as the pork meat in a can seems like a good alternative to consumers
.Kimberly Quan, a stay-at-home mom of three who lives just outside San Francisco, has been feeding her family more Spam in the past six months as she tries to make her food budget go further.
She cooks meals like Spam fried rice and Spam sandwiches two or three times a month, up from once a month previously.
Pulling Spam from the shelf prevents last-minute grocery store trips and overspending, said Quan, 38, of Pleasanton, Calif.
“It's canned meat, and it's in the cupboard, and if everything else is gone from the fridge, it's there,” she said.
Spam's maker, Hormel Foods Corp., reported last week that it saw strong sales of Spam in the second quarter, helping push up its profits 14percent. According to sales information coming from Hormel, provided by The Nielsen Co., Spam sales were up 10.6percent in the 12-week period ending May 3, compared with last year. In the past 24weeks, sales were up nearly 9percent.
The Austin, Minn.-based company, also known for the Jennie-O Turkey Store, has embarked on its first national advertising campaign for the 71-year-old brand in several years. They've credited the sales increase to that, along with new products like individually packaged “Spam Singles” slices. Also helping sales, executives said in an earnings conference call, was the fact that people looking to save money are skipping restaurant meals and eating more at home.
Spam sales are reaching across all spectrums, young and old and rich and poor, said Swen Neufeldt, Hormel's group product manager for the area that includes Spam. Many of the eaters are new to Spam, which was created in 1937 and gained fame as the meat that fed Allied troops during World War II.
“We have significantly increased our household penetration,” Neufeldt said. “I think it's a lot of folks that are coming into the brand perhaps for the first time, and coming back to the brand.”
Consumers are quick to realize that meats like Spam and other processed foods can be substituted for costlier cuts as a way of controlling costs, said Marcia Mogelonsky, senior research analyst with Mintel International in Chicago.
These products have protein and decent nutritional value, and they provide some variety to consumers who may be bored because they're eating more at home, she said.
Other companies are seeing similar boosts in their lunch meats. Kraft Foods Inc. reported last month that subsidiary Oscar Mayer, which makes hot dogs, bacon and cold cuts, saw double-digit revenue growth in the previous quarter in its Deli Fresh cold cuts. The company, based in Madison, Wis., has recently introduced products, including family sized deli-meat packs and deli-carved meat.