Report Says Frozen Food Sales Flat at $44 Billion

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ROCKVILLE, Md.—Sales of frozen food in the United States were flat in 2012, reaching $44 billion, with nearly all dollar sales gains attributable to inflation or new products—not to increased consumer demand, according to new market data from Packaged Facts.

According to the “Frozen Foods in the U.S., 4th Edition" report, contributing to this stagnation are the nation’s slow economic recovery; changing consumer eating patterns, shopping patterns and demographics; lack of excitement in frozen foods categories and merchandising; retailers’ increased focus on the fresh foods perimeter to the detriment of center store categories; and competition from fresh foods (including prepared fresh foods), shelf-stable foods, and restaurants.

The situation presents huge challenges and opportunities for marketers and retailers. In fact, major marketers, including ConAgra, Heinz and Unilever, already are slimming down and refocusing their brand portfolios. David Sprinkle, publisher of Packaged Facts, said frozen food marketers are stepping up to the plate is by emphasizing freshness.

The emphasis on freshness responds to shifting consumer priorities. An August 2012 Packaged Facts survey found a preference for fresh foods is the top reason (57%) shoppers cite for not buying frozen foods in the last three months, followed by a preference for home-cooked foods (35%). In comparison, fewer than 1 in 5 shoppers say they have not bought frozen foods because they don’t like the taste, don’t have enough freezer space at home, are not confident in frozen foods’ nutrition, or are not confident in frozen foods’ quality.

The report examines frozen foods across four classifications: Center Plate (frozen dinners/entrees, frozen hand-held non-breakfast entrees; frozen poultry, seafood and meat; frozen pizza; frozen pot pies; and frozen baby food); Vegetables, Appetizers/Snacks, and Sides (plain and prepared frozen vegetables; products positioned as appetizers/snacks or frozen side dishes; and other meal components such as frozen bread/dough, frozen pasta, frozen tortillas, and frozen sauces, gravies and seasonings); Breakfast Foods (waffles/pancakes/French toast; frozen breakfast hand-held entrees; frozen breakfast entrees; and other frozen breakfast foods, such as bagels, muffins and frozen egg substitutes); and Frozen Desserts (including frozen whipped toppings, frozen sweet baked goods, and frozen cheesecakes; frozen pies; frozen fruit; and frozen cookie dough and cookies—ice cream and frozen desserts are excluded).

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