The Planted Row: Building perceived value

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Farm Forum

Would you pay $3,200 for a steak? No? What if I told you the steak came from Blonde Aquitaine cattle slaughtered 16 years ago?

According to CNN (http://cnn.it/2dGrVoh), sixth-generation French butcher and farmer Alexandre Polmard has a method to store meat indefinitely with no loss of quality. His father and grandfather pioneered the method: placing the meat in a –43 degrees Celcius environment and blowing cold air over it at 120 kilometers per hour.

Polmard’s cattle are raised in a very low-stress environment in forests and on parkland. There are no confined spaces; though, there are shelters the cattle can visit when the weather is bad. Only four animals are slaughtered per week.

Most of the meat Polmard sells has been aged between 28 and 52 days, but customers put their names on waiting lists for months to purchase the most-aged cuts.

Now, I’ve been accused of having wine tastes on a beer budget, but I don’t think I’ll ever be able to pay $3,200 for a steak. And I don’t know exactly how I’d feel about eating meat that last chewed grass before the Twin Towers fell. My grandfather’s philosophy on steak was “slap the horns off, wipe the butt, and bring it on,” and I kind of adopted that. Freshness is an important aspect of a good steak, as far as I’m concerned.

But who knows what I might do if I won the lottery or was born with a trust fund? I’ve been to both New York and Los Angeles, and those experiences have taught me there are plenty of people in the world with more money than things to spend it on. Who’s to say I wouldn’t become one of them if I somehow magically got the means? After all, there’s worse things in the world to spend your money on than a steak, aged or not.

What’s outstanding in this story is that Polmard is building value into his product. I’m sure the meat is exceptional. Fabrice Vulin, a chef who serves Polmard’s 2000 vintage millesime cote de boeuf, says you almost don’t need a knife to cut it. But does the beef really taste so much better than USDA Prime that it’s worth thousands of dollars per steak? I can’t say for certain, but I doubt it.

Polmard, through exclusivity and marketing, is creating the perception of extreme value in his product. How much of that price are customers paying just to say they’ve eaten a Polmard steak? My guess: a lot.

This is an extreme example of the type of marketing organic producers take advantage of. Is organic food more nutritious? Not really. Does it taste better? Not that I’ve been able to tell. However, the people who purchase it believe it is healthier and tastes better, and they’re willing to pay more for it. That perceived value creates an opportunity for a producer. By regulating the term “organic,” producers are able to maintain its standard. By making that standard difficult to obtain, producers are able to limit supply. Then they market that standard, making sure to set it apart from more conventional foods. And just like that, organic food is worth more.

Some people are very concerned about the current livestock market and what it means for the future of the industry. One knowledgeable, longtime member of the industry told me last week that he’s very concerned the smaller producers won’t be able to make it out of this downturn.

I think Polmard is showing the way forward for those producers: find a niche that adds value to your product. Is that grass-fed or organic beef? Is it an exotic breed of cattle? Is it specially aged meat? However you feel about those concepts, they offer a future for smaller producers as profit margins tighten.