Having enjoyed solid annual growth over previous years, value sales of chilled pizza in France fell by 1% between 2013 and 2014, marking the worst annual performance for the sector since before 2010.
By Alex Beckett Global Food and Drink analyst, Mintel
As French supermarkets upgrade their private label frozen pizzas, Sodebo focuses NPD efforts on premium innovation. Moreover, one in four French consumers claim to be actively reducing their consumption of, or avoiding, dairy.
Frozen pizza sector outpaces chilled
Chilled pizza is more widely eaten than frozen formats in France, but sales are struggling. Chilled pizza has traditionally been the most popular format in the French retail market, unlike much of mainland Europe. And, whereas usage of frozen pizza declines as consumers in France get older, chilled pizza appears to have a more universal appreciation, with usage fairly balanced across the age groups, at around two-thirds of consumers. Frozen pizzas are generally lower in price than chilled pizzas, which may boost their appeal to young consumers. Certainly, affordability is a key purchase driver for young French consumers, as 38% of pizza users aged 16-24 consider low price to be an important factor when choosing pizza, which is high compared with the 20% average.
Yet the French chilled pizza market has suddenly found itself in trouble.
In 2014, the value of France’s frozen pizza sector exceeded that of the chilled pizza sector for the first time, according to Mintel estimates. Having enjoyed solid growth over the previous years, value sales of chilled pizza fell between 2013 and 2014, marking the worst annual performance for the sector since before 2010.
An over reliance on price promotions has dented category growth, according to leading chilled brand Sodebo. A spokesperson told trade press that four out of 10 Sodebo pizzas were sold on discount. The declinein chilled is in stark contrast with the frozen pizza sector, which enjoyed its strongest annual growth in 2014.
Private label goes upscale
The strong sales performance of frozen pizza in 2014 comes at a time when launch activity in the frozen sector is booming. For example, in the 12 months to August 2015, over two-thirds (68%) of all pizza launches in France were frozen, with the remainder chilled. This is a huge increase compared with the previous year, when chilled formats accounted for 52% of launches. The majority of these frozen launches were private label, and were relaunches as opposed to new products, illustrating how France’s supermarkets are attempting to boost the quality image of their frozen pizzas. Various private label frozen pizza brands have revamped their packaging to project a more upmarket image, to entice consumers away from chilled. Upscale chain Monoprix revamped packaging across selected lines with more rustic yet stylish packaging, while Carrefour has made the imagery of topping ingredients more prominent to help convey a fresher quality. Meanwhile, the discounters Lidl and Aldi have seemingly devoted the bulk of their activity around new products and have sought to convey a better value for money image by launching XXXL-sized lines and having two pizzas in the same box.
As for chilled, Sodebo, told the French food trade press in September 2015 that it was hopeful to rejuvenate growth in the chilled sector with its recently launched La Pizz range and also the upmarket Crust range which launches in October 2015. The Crust pizzas feature a gratin style crust with cheese and breadcrumbs baked on the crust, and a larger amount of filling than its other variants. It’s a premium range for which Sodebo anticipates consumers will pay full price to remedy the over-reliance on promotions.
Frozen lactose-free pizza from Dr. Schär
For both the chilled and frozen pizza sectors, there remain untapped opportunities to provide lactose-free options. Innovation in this area has been all but absent in recent years in France, which is fairly representative of the limited lactose-free activity in other European pizza markets. However, in summer 2015, the leading European player in gluten-free bakery, Dr. Schär, reformulated its gluten free Margherita pizza offering in France with a new lactose-free Italian mozzarella topping. This launch presents the frozen sector with a new advantage over the chilled sector – especially in light of recent developments in the French free-from market. Although the French are among the highest consumers of cheese in the world, one in four (24%) consumers claim to be actively reducing their consumption of, or avoiding, dairy. Older consumers are much more likely than younger ones to be monitoring their cheese intake for health reasons. This suggests particular lactose free opportunities for France’s chilled pizza sector, considering how much more likely over-45s are to eat chilled pizza rather than frozen.
Perspectives
The French chilled pizza sector can potentially reignite value sales growth by providing high-quality offerings that supermarkets could charge more for, and consumers could be prepared to pay full price for. The private label frozen pizza sector appears to be enjoying the rewards of conveying a more upmarket and value-for-money image. Also, as more French consumers cut dairy out of their diets, pizza brands can innovate around lactose-free cheese toppings to establish a point of difference against competitors. Finally, the gratin-style crust of Sodebo’s forthcoming Crust range may inspire premium innovation in other pizza markets.
