Frozen foods are known for convenience, not least because of availability whenever a quick meal is required. They have occasionally ‘wowed’ in recent times, with in-store displays with dry ice, DIY molecular gastronomy kits, and fridge compartments that can be changed into a freezer at the flick of a switch. Technology will improve the convenience of planning, shopping and cooking into the future. Frozen ready meals or prepared meals are considered a convenience product.
So too are foods that are easy to prepare like burgers, fish fingers, chicken nuggets, pizza, ready to roll pastry, ice cream and frozen desserts. But ready meals and beef burgers have been in the news of late. There was a noticeable sales reduction with the horsemeat crisis or ‘horsegate’ as it is being called. UK Kantar Worldpanel retail sales data shows that sales of frozen ready meals were minus 5.1% YoY on 15/09/13, compared to last year when they grew by 5.9% in value. Before ‘horsegate’ the overall frozen food market was growing in value by 6.3% and the grocery market by about 3.3%, but the impact of ‘horsegate’ reduced overall growth to 3.1% in the frozen food market. “The ready meals (sales), because of the consequences of ‘horsegate’ have all slowed down,” said Brian Young, director-general of the British Frozen Food Federation (BFFF). “We will see some of the numbers beginning to look better soon. They are still good, in comparison to grocery and retail in general, but frozen food has been hit by the criminals infiltrating the supply chain.”
He added that value for money continues to be the primary motive for food purchases, with convenience in second place. For example 40% all groceries (frozen, fresh and ambient) were bought at special offer / reduced prices. However ‘horsegate’ had an unexpected positive, as retailers introduced higher quality products with more traceability, but which cost more. “We are seeing new products, some higher price points, and better quality frozen foods coming into the market, which might not have been possible a year ago, because the market was so dominated by low prices,” said Brian Young. The retailer own label has led this trend, but it is also evidenced in new and existing brands. For example, Birds Eye has re-launched some platter meals that are of a higher quality. Such products can achieve prices at least 50% higher than traditional frozen foods and closer to fresh or chilled meal prices. The UK is not alone in suffering the effects of ‘horsegate’, as many other European countries also saw a downturn in burger and ready meal sales.
Nestle announced in October (2013) that it is closing down its Maggi frozen meals plant at Beauvais, France. This is as a direct consequence of ‘horsegate’. In France, sales of ready meals fell by 40% in the immediate aftermath of the scandal and are currently down by a quarter on last year. Other countries have reported similar figures. Likewise, in Ireland, ‘horsegate’ coupled with discounting of ready meals has led the Irish Food Board (Bord Bia) to work with producers on diversification, to keep the frozen food category ‘interesting’.
Tomorrow’s trends
Tomorrow’s Shopper (commissioned by Bord Bia), prepared by The Futures Company and based on European and American markets, indicates four main drivers of the shopper of the future – value, convenience, trust and technology. Technology has the potential to transform how shopper needs are met. In the future, this will develop alongside the technologies that become mainstream. “Brands are using technology to link shoppers to content that offers support at the point of use, such as understanding how to cook a product, offering personalized deals, or to assist in pre and post purchase research,” said Paula Donoghue, brand and insight manger, Bord Bia. “According to Gartner, 50% of all internet sales globally will take place via social media by 2015”.
The Click and Collect schemes, which are popular in France, enable the shopper to order online and go to the supermarket or hypermarket to collect the order and if desired to top up with impulse buys. A variation on this is the “direct to consumer” schemes where the shopper orders on line and takes delivery of the food. Home delivery is particularly popular in Germany, where the direct-to-home market caters for more than 4 million households and worth more than EUR 1 billion at retail sales value. In the UK, nearly one in seven online grocery orders involve the use of a smart phone – such as an iPhone or Android device. Looking ahead, virtual stores that allow purchases by scanning an image of a product or a QR code will make it possible for consumers to shop wherever they are. Tesco is trialling the UK’s first virtual grocery store at Gatwick airport.
Travellers awaiting planes can scan virtual product shelves with their mobile phone, place an order, and have their shopping delivered at home on the day they return from their trip or holiday. While the airport shopper has yet to establish itself, one trend which has firmly taken hold it the shift from larger to smaller retail formats. This reflects shoppers’ desire for improved access to grocery, because of growing time pressures, changing working patterns, and more time spent on-the-go. The number of small format stores such as Tesco Express and others from Sainsbury, Asda and Morrisons, are up 10% in last 2 years and due to grow by 12% by 2015.
Discounters are also entering the convenience battle, with Aldi opening its first small format in North London in April 2013. Carrefour and Casino in France; Zabka in Poland and the Czech Republic; Condis and DiaMarket in Spain; and Dogn Netto in Denmark, are just some of the many retailers with convenience stores. The space allocated to frozen foods has also been shrinking, in particular in the express outlets. “There has been growth of express formats where frozen is very under represented. So that is not really good news for frozen in terms of how stores and shopping is evolving,” said Stephanie Moe, sector manager Frozen Foods, Bord Bia.
Industry report
Stephanie Moe has co-authored The Future of Frozen Food report, which looks at this and other trends in the market and illustrates how such challenges might be met. The limited freezers currently tend to be stocked with high volume staples such as chips, pizza, popular ready meals, and similar products and ice creams for a treat. “It is a risk and an opportunity in terms of remaining relevant (with less space),” said Stephanie Moe. “It is about looking forward and seeing what they (food manufacturers) can develop for the convenience shopper and introducing products that are going to tap into that ‘grab and go’ trend for example,”
The Future of Frozen Food report looks at key European, Asian and American markets and states that global frozen prepared-food industry is experiencing strong growth and is expected to reach sales of EUR142 bn by 2015, with significant opportunities in emerging markets in Asia, Latin America and Eastern Europe. The report, and workshops which introduced it to frozen food producers who supply European markets, emphasised the need to reframe the role of frozen as a convenient meal solution. “The frozen category needs to tap into the consumer trends in order to be relevant,” explained Stephanie Moe. “It is about knocking the old idea of frozen TV dinners and ready meals on the head and looking at what frozen can be and how it can fit into consumer life.”
For example frozen foods can offer shortcuts like the meal kit with various components of a meal, catering for the consumer demand for ‘cook from scratch’. Frozen food can facilitate the consumer demand for more exotic food with key exotic ingredients available to be used in the quantity required without waste. “It gives you that flexibility that you can dip in an out of the packet,” said Stephanie Moe. “There is certainly an opportunity for the freezer to be a source of ingredients that can be added in to the cooking from scratch trend.” Another trend highlighted is portable frozen food solutions for increasingly hectic lifestyles, more fluid meal patterns and greater ‘on the go’ consumption. For example the Tillman’s Toast Me snack, which can be toasted straight from the freezer, is available in the UK and Germany. Frozen can facilitate convenience in healthy eating and special diets with products like cubes of smoothie drinks, or healthy foods such as spinach, or gluten free meals or ingredients.
The demand for wholesome food for children can also be catered for with items like a US product broccoli chips. In the UK McCain’s ‘Jacket Smiles’ specifically for children up to 10 years old, featuring smiley faces stamped into the potato skin. Frozen foods are also known for safeguarding nutrition, as many companies have emphasised the concept of ‘fresh frozen’. For a consumer who wants nutritious food and ‘super foods’ without too much work, and readily available, there are products like Aojiru health drink, made from Kale, and now available in frozen liquid concentrates to better preserve its nutritional benefits from Japan. A Kinsale Gourmet frozen pie includes the sea vegetable dillisk (a type of algae), rich in vitamins, minerals and antioxidants not found in land-grown plants, from Ireland.
Today’s trends and products
PERIscope 2013 report launched at the end of October covers the current consumer trends. For example, it states that in France consumers are about buying local and often. In Germany, pack size and reducing waste are vital, and the environment is a big concern in the consumer choice. In Ireland and the UK, there is an emergence of less focus on convenience and more on home cooking, as a catalyst to bring people together. Consumers are looking for solutions to help make cooking easier and their use of convenience foods as a whole has declined from 62% to 48% since 2005. “People want foods that are quick to cook, and easy to prepare, in all of the markets (in 9 countries) But there is a greater interest in doing a lot more,” said Paula Donoghue, brand and insight manger, Bord Bia. “So we have seen a slight decline in traditional prepared meals as people want involvement in the cooking.
That is not to say that they want to do it all.” The frozen food industry has been addressing the trend of more home cooking with products such as vegetables, meat or fish pieces as ingredients conveniently accessible in the freezer. Retailers have had special ranges for ‘cooks’. Chopped herbs, onions and garlic are also convenient products for the home cook. Many of these are not new in many European markets but are re-emerging in UK and to some extent in Ireland. Likewise other products popular in mainland Europe such as stir fry and pasta which are available in the bag may address this issue and become more popular in Ireland and the UK. In Scandinavia, there are ‘pick and mix aisles’, where the consumer can pick the exact number of prawns or mussels or other fish out of a frozen cabinet – ideal for a seafood chowder which requires small quantities of several fish. There is increasing interest in ethnic foods and while this trend has been seen in the UK market and Ireland for some time it is gaining pace in mainland European markets where the more traditional cuisines such as Italian are popular.
In France, Germany and Scandinavia there has been growth in sales of Asian and Indonesian foods including curries. Certain products stood out during the year for example the frozen baked potato saw sales in the UK retail market grow by 9.9% in value. While the idea of microwaving potatoes has been around for some time the combination of choosing the size and variety of potato for baking and the careful microwave instruction give a consistent product which can go from freezer to table in just three minutes – the ultimate convenience. McCain has a variety of products in this area including McCain Ready Baked Jackets. Bannister’s launched baked potatoes with fillings recently. There is continued interest in food ‘in a bag’ but in particular fish which can be baked the oven and accompanied by a good quality prepared sauce. Both Birds Eye and Youngs have products in this area.