Dive Brief:
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Frozen food sales fell by 0.1% in 2016, and the overall category is expected to have a CAGR of -1.2% from 2016-2021, according to a Packaged Facts report.
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According to the report cited by Food Navigator, "a leading factor in slowing the decline will be marketers' continued robust investment in product innovation" in the frozen aisle and "cleaner labels and healthier nutrition profiles."
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Much of the recent drop is the result of increased competition from other convenience items, such as shelf-stable or refrigerated products, as well as an uptick in consumers choosing to snack rather than eat a meal.
Dive Insight:
As the U.S. moves from spring into early harvest seasons and fruit and vegetable supplies become more plentiful, the appeal of fresh produce items will increase. That's an unavoidable issue for the frozen food seller, but it shouldn't discourage product innovations.
Unfortunately, thanks to innovations in refrigerated fresh offerings, many consumers see frozen foods as less nutritional by comparison. Waning interest in traditional meal formats also has hurt frozen items that were once household staples, like frozen pizzas and TV-style dinners.
Frozen food manufacturers should look for opportunities to improve the nutrition profiles of their products by further cutting sodium, sugar and other preservatives. This can be tricky. Natural preservatives don't often yield the same shelf life as traditional methods. At the same time, today's health-conscious consumer is interested in both convenience and health. While shoppers of the past weren't concerned with a product's sodium labels, consumers now want their convenience foods to deliver the nutrition of a fresh meal.
Producers also should use their packaging to educate consumers about the benefits of frozen products, especially fruit and vegetable mixes. Because frozen produce items are flash-frozen and packaged often immediately after harvest, it retains its peak nutrients and avoids the bumps and bruises that traditional produce suffers throughout the supply chain. According to a recent study, some frozen fruits and vegetables have greater amounts of vitamins A and C than fresh-store produce.