Not your father’s frozens
Young shoppers have shown a proclivity for fresh and premium fare, but many are also responding to frozen foods touting global flavors, gourmet ingredients and clean labels, retailers said.
“Millennials have been a tricky audience for frozen due to a penchant for fresh, less- processed foods, even more so than previous generations who had a kinder association with frozen foods and grew up using them more,” said Jennifer Goodrich, senior analyst with The Hartman Group, Bellevue, Wash.
“The brands within the categories have taken notice and are doing a lot to try to recapture their lost consumer base. We’re seeing cleaner ingredients, more interesting cuisines and new brands that don’t have this legacy of processing associated with them, and Millennials are starting to take notice.”
Such is the case with Ahold Fresh Formats’ bfresh banner, which caters to Millennials with fresh, affordable groceries in an urban, small-store setting.
The three-store banner emphasizes its prepared foods selections, but recently pivoted in response to consumers’ desire for value by bringing in private labels and dedicating more space to frozen foods.
“When we first developed our offering we thought that Millennials would shy away from frozen, but now we’ve seen after a year that they’re much more interested in the space, so we’ve adjusted our offering as well as the space that we allocate to frozen foods,” said Crickett Blauch, category manager of non-perishables for bfresh, when speaking of its year-and-a-half old Allston, Mass., location.
During the year ending September 2016, the frozen food category at the store kept pace with sales in other departments, but certain frozen categories outpaced sales across the store. Among the standouts were frozen produce, ice cream and pizza, according to Blauch.
“Frozen vegetables like peas, frozen fruit such as the mixed berries and strawberries, the higher end ice creams such as Ben & Jerry’s and private label pizza are doing very well,” she said.
Americans tend to be more open to frozen foods than in the past. A consumer survey by Packaged Facts shows that 90% of consumers buy packaged frozen hot meal items for heating or microwaving at home, up 15 percentage points in just two years.
Half of frozen food consumers are buying more frozen vegetables/side dishes, 40% are buying more packaged frozen pizzas and frozen meals and one-third are buying more packaged frozen snacks/appetizers.
Innovations are helping to move the needle. They include new forms of frozen vegetables like Green Giant’s Veggie Tots, Riced Veggies, Mashed Cauliflower and Roasted Veggies. Manufacturers are also stepping up their game with exotic flavors. Lean Cuisine has limited edition entrées that draw inspiration from its chefs’ global travels, for instance.
Certain retailers have also helped buck the category’s freezer-burn image. “Trader Joes has always been a leader in the frozen aisle, creating new and different products that consumers enjoy not only eating but taking part in the search,” Goodrich said. “They’ve made their frozen aisle really user-friendly with the open cases and have laid it out to glance at all at once rather than use the tall, long aisles that are in a grocery store.”
James Osborne, Jr., category manager of frozen foods for Naperville, Ill.-based Kehe Distributors, noted that shoppers are seeking clean labels with “easily traceable raw goods” when shopping for natural and organic frozen foods, and that handheld, snacks are appealing to young consumers, in particular.
“A frozen food trend geared to Millennials are quick ‘hand-to-mouth’ options for immediate consumption,” he said. “We are also seeing more innovative taste profiles for vegan, vegetarian and gluten-free diets, especially for Millennials concerned about their health. This includes various line extensions using different ingredients — pineapple, chorizo, roasted cauliflower, quinoa, masala — in a mixed/mashup bowl or wrap for on-the-run consumers.”
The frozen food selection at Fletcher, N.C.-based Earth Fare keeps with the company’s stringent food philosophy and vetting criteria, which prohibits foods containing artificial preservatives, sweeteners, colors, bleached or bromated flour, high-fructose corn syrup, antibiotics, trans fats or artificial fats. Despite the restrictions, there is plenty of frozen food from which the retailer’s buyers may choose.
“Frozen food in natural has grown in leaps and bounds in the past decade, and we’re not wanting for selections in frozen,” said Justin Jackson, chief merchandising officer for the 31-store chain. “In fact, some of the larger CPGs are moving into this space where they see that growth occurring, so it’s not a challenge despite our food philosophy.”
Earth Fare’s 20- and 30-something shoppers opt for frozen fruit over fresh when looking for a simple and economical way to make smoothies at home, said Jackson.
For those looking to consume more vegetables, the retailer just launched a Riced Cauliflower product under its Earth Fare private label line, which earlier this year became GMO-free.
It behooves retailers to market products like these to young parents. “Millennials with kids definitely rely on frozen fruit and vegetables ingredients since they are even more time-pressed than their counterparts, and looking for quick easy fixings,” she said. “We also see a desire for Millennials to participate in the cooking process a bit, so maybe they’ll outsourcing the vegetable [to frozen] but prepare a protein.”
Handheld breakfasts and globally inspired snacks such as Tandoori Seasoned Chicken Nuggets, which are sold under the Saffron Road line, are among Earth Fare’s top frozen sellers. Amy’s Pizza and EVOL burritos are also standouts at the chain.
The retailer rounds out its selection of national brands with smaller, local selections in categories like craft ice cream. Jackson noted that these small batch purveyors tend to vary by store.
“Our geography is such that we have stores from Michigan all the way down to Tampa, Fla., but we localize and bring in smaller producers where we can,” explained Jackson. “We have a new vendor fair before every new store opening, where we meet with 40 to 60 local suppliers and we’re driven to get these products in to help distinguish those stores.”
St. Louis-based Straub’s, which caters to Millennial shoppers and others living in small households, touts a localized selection of frozen foods along with some national brand mainstays. Since it stores are prepared food destinations it doesn’t merchandise a ton of frozen entrées but does dedicate a disproportionate amount of space to craft ice cream and frozen pizza.
“I have the finest selection of specialty pint ice cream and flavors of anyone in St. Louis,” said Bill Hussey, Straub’s director of specialty foods and center store. “We try to stay on the leading edge of these craft, small-batch ice creams that in the beginning may be too small to supply a [large] chain so that we’re the first ones to get it. We work hard at that since we don’t have a lot of [frozen shelf] space.”
The four-store retailer dedicates six to eight doors or about one-third of its frozen food space to varieties such as Jeni’s Roasted Red Cherry Goat Cheese, The Comfy Cow’s Southern Jam Cake and Graeter’s Bourban Pecan Chocolate Chip Ice Cream.
McConnell’s, Ciao Bella, Ted Drewes, Anna Marie’s, Steves and the Straub’s store brand of ice cream are also represented at Straub’s.
Given the unique offerings and experimental nature of its shoppers, the retailer does a year-round business with these sweet treats that range from $7.99 to $9.99 per pint.
“Our demographic is not your typical family of four, it’s Millennials, singles, retired couples, people with disposable income who are buying a treat,” said Hussey. “People say that ice cream season is summer, but our better ice cream sales are in December, due to the holidays.”
Local brands of St. Louis-style frozen pizza, known for its thin crust and Provel cheese, which blends provolone, Swiss and white cheddar cheeses, are also highlighted at the chain. The selection includes Dog Town Pizza, Gallagher Bros., Shakespeare Pizza and Columbia Pizza.
“We carry three or four big brands, and I’m always trying to find a local pizza that the bigger chains can’t carry because the supplier is too small for a 100-store chain,” said Hussey, who is so passionate about pizza that he’d choose it as his last meal. This type of enthusiasm is helping frozen foods regain their place at the table.