Frozen Foods Morph From Bland to Bold

Frozen food is the ultimate in convenience, and category sales continue to climb. In 2018, dollar sales of frozen foods were up 2.6%, according to the American Frozen Food Institute (AFFI) in Arlington, Va.

The latest market research from Chicago-based IRI found that dollar sales of frozen pizza were up 4.8% for the year ending July 14; breakfast food sales increased 3.3%; and dinner/entree sales jumped 1.8%. Frozen single-serve meals make up the largest part (44%) of the dinner/entree category, according to Packaged Facts, Rockville, Md., followed by handheld items (27%) and multiserve meals (20%).

Frozen food is back on a growth trend thanks to appealing price points, convenience and new innovations, says Jim Hertel, SVP of Winston-Salem, N.C.-based Inmar Analytics.

Michelle Dorin, director of center store sales, dairy/frozen and communication for Weis Markets, Sunbury, Pa., says plant-based items, alternatives to carbs such as riced cauliflower, innovative products and nondairy options are all helping keep the category relevant. “Millennials who are looking for quicker, faster, easier meal solutions without leaning to fast food [are increasingly] buying frozen, and we can give them better and less expensive options,” she says.

“Convenience for the 1950s housewife was a can, but now we’re having additional innovation with packaging and different ways of heating products,” says Kara Nielsen, senior leader of food industry innovation, trends and strategy for CCD Innovation, Emeryville, Calif.

Innovation Explosion 

Shoppers at Weis Markets’ 200 locations are looking for frozen foods to be exciting, and innovation in frozen “has been exploding of late,” says Dorin. Examples include Oprah Winfrey’s O, That’s Good frozen pizzas, with crust that contains one-third cauliflower, and Conagra Brands’ Healthy Choice Power Bowls line extension of grain-free options.

“Frozen foods used to be very bland, but they’ve come a long way,” says Dorin. “It’s a good culinary substitute for a meal customers don’t have to cook at home, and frozen manufacturers are providing better-for-you options.”

Meanwhile, frozen pot pies have been a popular choice at Weis Markets, which prompted the retailer to change its dinner set to include 4-foot sections for pot pies. Sales are up by double digits—it’s all about the convenience of just heating these up, Dorin says.

Innovation in frozen has really come to the forefront, says Hertel of Inmar Analytics, who points out that due to the simple cost of keeping products in a freezer, every product has to earn its place. “But there must have been a mindset shift among frozen merchants as they started thinking about what they can learn from the rest of the store, because a lot of the things that have been really successful are from startup companies,” he says.

This includes products such as Luvo’s Quinoa & Veggie Enchilada Verde and Wholesome Pantry’s Organic Veggie Bowls.

Offering products such as these can also help retailers appeal to a younger shopper. “There’s a perception that frozen food isn’t fresh, but there’s a perception that it’s higher quality than something in a can. So if you have convenience, price and better-for-you, it appeals,” Hertel says.

Consumers need to know that frozen food can have as much nutrition as fresh food, says Nicholas D’Agostino III, president of the New York Food Group in Manhattan, which includes D’Agostino’s and Gristedes banner stores. Consumers are also looking for these items to be more exotic, he says, pointing out that foods such as Indian dishes are doing well.

“People like something a bit different,” says D’Agostino. “It’s about getting enough variety, so we go with a lot of smaller companies and specialty suppliers.”

The big manufacturers are getting into the innovation game too, with products such as Stouffer’s Beer Glazed Meatballs, made with Back Forty Beer Co.’s Truck Stop Honey Brown Ale; Green Giant’s Harvest Protein Bowls; and Marie Callender’s Red Chili Grilled Chicken Burrito Bowl.

They’re also acquiring smaller companies. For example, Conagra purchased Evol last year. In other cases, they’re stealthily launching their own products, such as Wildscape, which makes frozen protein bowls and is owned by Nestle—although there’s no mention of the food giant on the packaging. These innovative products tend to cost more, but the consumer for these products is “looking for quality, clean ingredients and is not afraid of the price,” Dorin says.

While the bulk of sales in the frozen aisle (79%) are generated by the big manufacturer brands, according to AFFI, private label is heating up frozen food sales too. “When we start to break down growth among manufacturer brands and private [label] brands, private brands drove above-average growth in 2018 (6.1%),” says Adrienne Seiling, VP of strategic communications for the trade association.

Better Labels 

Organic, natural and clean label products can also help keep the frozen category on trend while dispelling perceptions that frozen foods are highly processed and unhealthy.

Weis Markets houses these items in store-within-a-store sections to showcase them and help them gain traction. Pizza and frozen dinners are among the products that do well with this merchandising scheme, says Dorin, noting that she’s also had some success with breakfast items.

It’s helpful to have these products called out in their own section, says Russ Williams, VP of brand management and sales for Wellesley, Mass.-based Good Food Made Simple, “because consumers know where to go immediately and don’t have to go through a number of freezer doors to find a little brand like us. It’s hard to get noticed if you’re in with the mainstream.” Good Food Made Simple offers a range of 40 frozen items, mostly breakfast dishes and some dinners.

Photograph courtesy of Good Food Made Simple

Cleaner-label products are certainly a game changer for the frozen category, says Neil Stern, senior partner with McMillanDoolittle in Chicago. Frozen foods can still be “considered a second-class citizen” due to undesirable ingredients such as additives and high levels of sodium, but that perception is changing with “cleaner-label products and better ingredient products—mostly from the smaller companies,” he says.

Frozen clean label products grew at a compound annual growth rate of 26% from 2016 to 2018, with more claims of natural, GMO-free and no added preservatives, according to Innova Market Insights. By the middle of 2019, “we have more items with clean labels for frozen ready meals than we had in the whole of 2018,” says Tom Vierhile, VP of strategic insights, North America, for the Netherlands-based company. “Clean label is almost the price of entry now.”