FROZEN OR FRESH?

BARBARA MURRAY

Expectations for summer sales in the frozen-dessert category are mixed, with some retailers saying full indulgence is back and others claiming that frozen desserts are losing out to fresh baked goods and fresh fruit.

Shaw's Supermarkets, East Bridgewater, Mass., said sales are up. The retailer expects more new products and promotions, and credits the 50-plus age group -- who feel they deserve their cheesecake -- with fueling the demand.

But Jim Amen, frozen-food buyer for Super A Foods, a 12-store chain based in Paramount, Calif., said the category goes down each year due to competition from fresh pies and pastries. "Working moms want everything done [for them]," he said.

Each retailer polled agreed that full-indulgence products are back in favor with most consumers. Russ Hahn, buyer and merchandiser of frozen food for Scolari's Food & Drug, Sparks, Nev., said consumers "like the good stuff.

"The Healthy Choice stuff is kind of waning," he said. "If people are going to pay the same kind of money, [they feel that] they might as well enjoy it, even though the low-fat, non-fat, reduced-calorie stuff is improving in taste."

Like Amen in California, Hahn expects frozen desserts will be flat until the holidays in November and December. "You see a lot of people trending off to fresh baked products," he said, adding that Scolari's does have a fresh bakery.

Frozen fruits, however, "are doing real well. We've got a good variety that we are continually promoting; that's one category that's always growing. Why? [Consumers] make desserts with it, put it in berry pies and shortcakes, and use fruit in the new fad of making smoothies," he said.

For summer, Scolari's is planning promotions on cheesecakes and frozen fruits. Scolari's has its own brand in frozen strawberries, Hy-Top.

From Sara Lee, the chain has cheesecakes in two-packs, in Bites, in 17 ounces, 19 ounces and the new 30-ounce Classic, which Hahn just ordered. "I am speculating they'll do great," he said. As for Mrs. Smith's Operation 365, a promotional campaign for selling desserts steadily throughout the year, Hahn said, "They highlighted some introduction on that, but I haven't seen any development."

Last Christmas, "pies were great," Hahn said. "We had an increase in pies, but cakes were still a bit flat."

Frozen sweet goods (not including cheesecakes) had $372.4 million in annual sales, down 3.3%, according to Information Resources Inc., Chicago, for the 52-week period ended April 25, 1999. Brand leaders were Pillsbury Toaster Strudel, Sara Lee frozen sweet goods and Pepperidge Farm three-layer cake.

In frozen pies, the total category had sales of $264.5 million, up 5.3%. Brand leaders were Mrs. Smith's original line and Sara Lee and Edwards pies.

As for frozen fruit, the category was up 8.9% to $183.8 million for the same 52-week period ended April 25, 1999. IRI scan data show that Birds Eye private label is a big player, followed by Big Valley and then Birds Eye brand.

In frozen whipped toppings, Cool Whip is the leader. The category is worth $300 million, with Cool Whip varieties accounting for $200 million and private label accounting for most of the rest.

In the cheesecake segment, Sara Lee was the leader, followed by Eli's and Weight Watcher Smart Ones. The total cheesecake category is worth $63.4 million in annual sales, up 12.9%, and driven by the Sara Lee increase of 14.8%.

According to Dan Kemp, vice president of marketing for Mrs. Smith's, Mrs. Smith's desserts are up 8% for the most recent 52-week period, according to IRI data. He attributes the jump to Operation 365, which he described as "nothing more than trying to sell the desserts year-round rather than in the season.

"No. 1, our sales are clearly up, and all of the noise that we are making in the category is attracting other brands. In particular, the introduction of Marie Callender's cobblers and Sara Lee cheesecakes have contributed to the overall growth of the category. And that's a good thing."

Jim Ryan, director of business development for Pezrow-New England, Foxboro, Mass., said that previous owners of Mrs. Smith's used to concentrate on the holiday period, but the new owners, Flowers Industries, Thomasville, Ga., came up with Operation 365.

Ryan described Flowers Industries as "probably the largest baker in the country, with the technology to produce a wide range of sweet goods, not just Bake & Serve. That's the key." In May of last year, Flowers bought Pet Ritz cream pies and the Oronoque Orchards pie shells from Van de Kamps. In late December, Flowers purchased the licensing rights to Banquet and Mortons Honey Buns.

"They are trying to diversify their offerings with these different acquisitions, and then sell products that fit with each season," the food broker said.

Mrs. Smith's is currently running a national promotion as part of the annual "Cool Combinations" campaign done by the ice cream industry. A purchase of a Mrs. Smith's pie earns consumers a dollar off a half-gallon of ice cream. In New England and New York, Ryan said, the partner is Breyer's. In other sections of the country, different ice cream brands, such as Blue Bell and Blue Bunny are used, said Kemp.

"We're expecting to see double, possibly even quadruple, results from that promotion," Kemp said.

In New England, Stop & Shop, Star Market, Shaw's, Demoulas, Big Y and A&P Food Mart stores all are participating. The only holdout is Hannaford Bros., Ryan said, commenting that Hannaford does very few ads. "It's difficult to communicate the program when you don't have ads," he said.

Stores in New York began Cool Combinations for Eastertime and ran it through Memorial Day, Ryan said. Most of his accounts are keying the promotion to the Fourth of July holiday.

"We are aggressively pushing all the cream pies: Banquet, Pet Ritz and Mrs. Smith's," he said.

"We have value brands, middle-of-the-road brands, and Restaurant Classics. "We have accounts running promotions on [the pound cake] at two for $3, tied in with fresh berry season," Ryan said. Typically, a grocer will put up a sign in the produce department, near the fresh berries, describing the frozen pound-cake sale as two for $3, along with a sign stating the price for a quart of berries. Customers are much more aware of ingredients, with the National Labeling Education Act guidelines, but they still want some indulgent treats, said Ryan. "You can tell by the increased sales of premium and superpremium ice cream. They are buying the high test, maybe not as often as they used to, but they want the good stuff," Ryan said.

Decent spring weather has also been a factor, he said, along with strong retailer support of the promotions.

Bernie Rogan, spokesman for Shaw's Supermarkets, gives Mrs. Smith's high marks for Operation 365, calling it "a unique approach to broaden the appeal of new products rather than emphasizing the seasonal period."