Why supermarket shoppers are giving a cold shoulder to frozen seafood

Frozen seafood is getting an icy reception from consumers.

Despite an average price decrease of 5.3% for the 52 weeks ending Sept. 8, to $7.30 a pound, which is 30% less than for fresh seafood, sales remain flat, reports Circana, a Chicago-based market research firm.

Frozen shrimp, for instance, had a volume decline of 0.3% despite a price decrease of 6.9%. In addition, frozen lobster volumes fell 10.3% with a price drop of 12%.

While sales were up for some species — frozen salmon had a 6.2% volume increase and a 5.1% price decline — overall sales are not keeping pace with the lower costs.

“Lowering the price of fish doesn't necessarily attract new customers,” said Russell Zwanka, associate professor of food marketing and director of the food marketing program at Western Michigan University in Kalamazoo.

He said that seafood, like many other food categories, has three product tiers — opening price point that makes seafood more accessible and can include such items as tilapia, salmon, and catfish — along with mainstream and premium. Mainstream and premium customers will rarely move down to purchase products that cost less or are of lower quality, as they are already confident in what they want to buy, Zwanka said.

“Price should not be the first lever to pull when trying to increase seafood sales, since there are multiple reasons why customers do not purchase products,” he said. “Attack the reasons why some shoppers find seafood unapproachable as a protein option before simply lowering the price.”

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Such factors include shopper discomfort in cooking seafood, their aversion to handling selections, and not knowing the types of side dishes that go best with seafood meals, Zwanka said. “Seafood has many advocates, and just as many who will never touch it, thinking it's too slimy, smelly, or just unappealing,” he said.

Frozen case signage can be an effective vehicle for providing shoppers with nutritional information. Photo credit: Richard Mitchell

Greater interest in canned or tinned fish, meanwhile, also is cutting into frozen seafood activity, he said. Volume sales of shelf-stable seafood grew 1.1% with a price decline of 0.5%, Circana reports. Shelf-stable tuna volumes were up 0.1% despite a 0.5% price increase, while shelf-stable salmon sales jumped 7.4% with a 7.5% price decline.

“Tinned fish is growing steadily and combines the convenience of being ready to eat and easy to store,” Zwanka said, adding that popularity also is resulting from the multiple tinned fish dinner suggestions that appear on social media.

Retailers can better spotlight and enhance the appeal of frozen seafood with clear in-store signage, by providing details on a product’s region of origin, and by situating all the selections together in the case, including breaded items such as fish sticks, he said.

Related:How to win over consumers on fresh seafood

“Maintaining variety is key,” Zwanka said. “Species like halibut, red snapper, and various types of salmon are best offered in the frozen case only, as they are quite expensive and only certain fresh seafood cases can move enough of those species to warrant offering them fresh. A frozen seafood section also is a super place to offer global species that normally would not be available fresh without a hefty premium.”

A major issue, however, is convincing customers that frozen seafood is as nutrient rich as fresh, he said, noting that “in many ways, it's better, since it’s usually flash frozen at sea.”

Gaining sales also requires that shoppers know where to locate specific frozen seafood selections in stores as there are often large arrays in either the frozen food aisle or seafood department, and sometimes both, Zwanka said.

“The frozen aisle tends to focus on ready to eat, like already cooked or battered and fried, whereas, the seafood department is mostly focused on the raw protein,” he said. “Showing the differences and enabling customers to easily choose from the options is a challenge.”

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Difficulties in viewing products behind frozen doors with glare is a further merchandising impediment, Zwanka said. In response, retailers can attach adhesive stickers to the outside of doors or on floors to identify available products or use hanging point of sale materials, he said.

Displaying signage and distributing information cards will enable retailers to extol product benefits, including nutritional data, while spotlighting the brands and varieties, Zwanka said.

Operators can further increase interest in the frozen case by offering more varieties in accordance with market trends and the interests of their target customers, he said. “There are many seafood cases in supermarkets with three types of salmon, some cod, and shrimp, but it can also be a great place to tout assortments of sea bass, branzini, red snapper, and flounder,” Zwanka said.