FROZEN ASSETS 2007

KELLY GATES

Retailers are chiseling out space in their freezers for categories that are traditionally shelf-stable. Recently, they've been making room for frozen baby and pet foods, which appeal to consumers' desire for fresher, more nutritious foods with a longer shelf life, retailers told SN.

“Shelf life is such an important factor,” said Maria Brous, spokeswoman for Publix Super Markets, Lakeland, Fla. “More products are moving into frozens from the fresh and short-shelf-time areas of the store, especially as consumers shop less often. It's a category where producers are able to market a level of quality and convenience that would be hard to match if these products weren't frozen.”

Brous has witnessed a number of new Asian-inspired rice and noodle bowls moving into the chain's freezers in recent years. Several varieties of Frosty Paws frozen dog treats have also been added. The sugar-free, Fido-friendly ice cream cups are available in original and peanut butter flavors.

While Publix doesn't merchandise any national-brand frozen baby food yet, it is currently developing a line of private-label frozen fare for its youngest customers. The retailer declined to comment on the specifics of the new products or an expected launch date.

Publix's interest in the growing frozen pet food category is sound. Frozen/refrigerated dog food sales were up 9.9% to $23.3 million in the food channel during the 52 weeks ending July 17, according to Chicago-based Information Resources Inc.

Fewer food retailers have trod the territory explored by Publix as it develops its frozen baby food line. Sales in the category rose 90.7% during the same time period, but on a tiny sales base of $1,100, according to IRI.

Often, the decision to move a product from the shelf into the freezer involves the opportunity to utilize less processing while preserving nutritional content, said Jim Wisner, president, Wisner Marketing Group, Libertyville, Ill.

“Less processing usually involves less cooking, and therefore not as many preservatives are needed,” said Wisner. “This produces foods with a fresher or more natural flavor profile, which is what many of today's consumers want — think frozen vs. canned vegetables, for example.”

Indeed, consumers today want better-for-you foods, Nevin Montgomery, president and chief executive officer for the National Frozen & Refrigerated Foods Association, Harrisburg, Pa., told SN. But shoppers don't just want the healthier fare for themselves. They want it for their kids too, including the furry ones, he said.

“Babies and pets are very dear to consumers, and they're realizing that many frozen foods are captured at their peak of freshness and don't have as many preservatives, so that's what they're demanding,” said Montgomery. “As consumers continue to perceive many frozen foods as more nutritious than their shelf-bound counterparts, food makers will be motivated to keep reformulating products for the freezer.”

Most retailers are dialed into consumer demand and therefore support the move from shelf to freezer. But when each cubic inch of case space is expected to produce profits, making the commitment to a new product can be frightening, he added.

Austin, Texas-based Whole Foods Market is currently testing the viability of frozen dog and cat cuisine at its 80,000-square-foot flagship Austin location. The store is merchandising a selection of raw meat blends in three freezer cases toward the end of the pet food aisle, according to a store associate.

“We have five or six different national brands of frozen dog and cat food, and they're all selling well,” he said. “Our meat department also sells all kinds of organs, like chicken livers, chicken hearts and chicken gizzards, to customers who want to make their own pet food. They can buy the organs or any type of meat they want at the meat counter, or they can get it in freezers where we keep the national brands of frozen pet foods.”

So many Whole Foods shoppers indulge their pets with natural diets, most stores in the chain cross-merchandise instructional/recipe books in the pet food aisles, he added. Whole Foods has been trialing a Wild Kitty Cat Food product in its Austin store, but the item isn't from the manufacturer's core frozen food line. Instead, it is cross-merchandising a turkey-and-clam-flavored whole food powder used as an add-in for cat food, said Stephanie Nadeau, president of Arundel, Maine-based Wild Kitty.

“Our main products are four flavors of frozen raw-meat cat foods, including chicken and clam, duck and clam, turkey and clam, and sushi and clam,” said Nadeau. “Pet stores are very willing to carry frozen pet foods, but it's been difficult to get them into supermarkets. Space is an issue for most of them, but they could always put a freezer in the pet aisle and would quickly get the return on their money with the huge profit margins from our products.”

The profit potential should entice retailers to at least stock their existing freezers with such items, said Nadeau, adding that shelf-stable canned cat food typically costs between 50 cents and $1.50, while frozen Wild Kitty products are priced at $2.49 per container.

She admits that some consumers might not be comfortable serving raw meat to their animals because of the potential for contamination. Wild Kitty Cat Food's frozen products were recalled in February of this year when salmonella was discovered in multiple packages. The company has since incorporated an ultrastatic pasteurizing step into its manufacturing process to help avoid a similar occurrence in the future.

ONLY THE BEST FOR BABY

As frozen pet food makers concern themselves with eliminating pathogens and overcoming consumer distrust, manufacturers of chilled baby products are focusing on freshness and nutrition.

“We use top-quality ingredients, carefully sourced, and don't use any added salt, sugar, additives, preservatives or fillers,” said Sally Preston, founder of U.K.-based Babylicious Ltd. “Most regular jar baby food manufacturers would claim the same thing. However, some jars of baby food do contain fillers, and some add artificial nutrients back in, as many of the nutrients are lost during the extreme heating process used to kill bacteria.”

All of the company's products are precooked, but not at the typical 121 degrees Celsius (249.8 degrees Fahrenheit), but at 95 C (203 F), she said.

Babylicious is one of the staple brands in the U.K., sold in chains like Tesco, Sainsbury's, Budgens, Costcutter, NISA and Waitrose, but is not presently sold in U.S.

Babylicious frozen pureed meals come in 18 varieties for babies up to 1 year of age. The Babylicious line also includes Kiddylicious frozen mini-meals for toddlers and preschoolers ages 1 year and up.

Flavors include sophisticated tastes like Potato & Parsnip with Carrot, Creamy Salmon & Broccoli, Fruity Chicken Curry and Spaghetti Bolognaise, to name a few.

According to Preston, Babylicious provides in-store signage for its retailer customers, and some smaller stores place leaflet holders on freezer doors with informational brochures about the manufacturer's products. The company has also partnered with local chains to carry out in-store sampling events and hand out coupons and leaflets to shoppers.

Despite the extra efforts and the relative success of frozen baby food in overseas markets, the food maker doesn't expect its tot-targeted items to bring much more than incremental sales to the category, said Preston.

“Retailers do have concerns with stocking baby food in the freezer section, as it relates to the amount of mouths to feed,” she said. “There will always be more people who can or will consume a frozen pizza than those who consume frozen baby food.”

Leeker's Family Foods, a four-store food outlet in Wichita, Kan., hasn't banked on frozen baby food. The retailer does, however, stock Frosty Paws ice cream and kid-focused frozens like the new line of SpongeBob-branded Green Giant carrots, green beans and cauliflower, said Eric Scriven, frozen food and dairy manager for Leeker's.

“We haven't gotten into baby food yet, and I'm not sure if or when we will,” he said. “But we have started selling several Asian dinners in our frozen department instead of just egg rolls. These include noodle and rice bowls, which used to only be available at the shelf.”

Eastern-inspired rice and noodle bowls have jumped from shelf to freezer at Publix stores too. Perishables like fruit and dessert cakes have also increased in numbers in the chain's freezers, but there just isn't enough room for everything that could rake in profits, said Brous.

“If frozen space was as available as other areas of the store and all of the excellent items that have to be turned away were available to the consumer, frozen food sales would be much greater,” she said.