Analysis by Peter Robinson and Sarah Hardcastle - Tackling the might of chilled - Feeling Great! rivals Enjoy! - More store flamboyance needed There's nothing like a flat market to galvanise manufacturers into action. Faced with a second consecutive lacklustre year in which the £3.3bn frozen food market grew less than 2%, virtually all the main brand players have responded with a flood of innovations and new concepts. The enemy that is limiting its growth is chilled food, rising inexorably. Birds Eye Wall's estimates chilled grew 14% last year, driven by increased average weight of purchase, lots of innovation and the consumers' persistent perception that chilled is better than frozen. BEW trading director Neil Jones says this is the biggest hurdle, despite numerous campaigns. "Chilled is still perceived as fresher, better quality and containing fewer preservatives than frozen ­ which is, of course, wrong. We have a big message to get over." Part of BEW's strategy to change perceptions was its mega launch earlier this year of Enjoy!, a premium convenience range of 13 meal solutions in bright foil packaging, merchandised in a branded standalone cabinet away from the freezer aisles. Designed to reposition frozen food as an alternative to chilled for immediate consumption rather than as a stored-in-the-freezer item, Enjoy! has brought a completely new look to the category. It has also helped boost frozen ready meals, one of the few frozen sectors doing well. Goaded by such flamboyant NPD, Findus is now moving into the Enjoy! territory with Feeling Great!, a range of frozen recipe dishes pitched as healthy convenient meals for busy people. Findus is putting £7m behind the new brand in the first six months ­ its highest spend ever, including £4m on TV ads screening from July. The six products, which take seven minutes to cook in the microwave, have already been launched in Sweden, where they have been a "runaway success" according to Findus UK general manager Mohan Mohan. He believes manufacturers alone cannot recapture the high ground occupied by chilled. "The unique selling conditions of frozen food make it imperative that retailers assist in creating better shopping environments. Clinical and boring frozen food sections simply cannot compete with the interesting shopping environments created at point of sale for other categories. Our experience in Sweden, shows what can be achieved to create a theatre' for frozen food through the effective use of space and design." His view is echoed by Dalepak md Jon Eagle. "The problem is the staid perception of the market from many who have been in it for a long time," he says. "But retailers are working hard on that, changing cabinets through merchandising and innovation. Most importantly, the quality perception of frozen food is gradually being changed. Our premium and flame grilled burgers are leading growth at the expense of economy burgers." Improving quality has become a big issue and is seen as one of the most important ways of bringing consumers back to frozen. BEW has a programme of product renovation under way, says Jones, which includes a relaunch of its traditional pies with a higher meat and sauce content in August, plus an increase in the pack content of its Chicken Os kids product to provide better value. "Lots of small product renovations are being done which we will bring together under a quality umbrella that we'll be communicating to consumers from January onwards," says Jones. The company also believes more theatre' will attract consumers. It sees promotions as one route and has a Legoland promotion on its children's products scheduled for August, plus another on its red meat ranges. Heinz business director Robin Walker feels a way forward is to focus on products that meet specific requirements. The company has been particularly successful with its Weight Watchers from Heinz brand which targets the growing healthy eating market. The brand was relaunched last autumn with more emphasis on taste and has since achieved 20% growth. Similarly its Linda McCartney meat-free brand has found a growing audience among meat reducers. The brand is about to see a major programme of activity to promote "relevance and performance", says Walker. Bernard Matthews Foods reckons the frozen market should offer premium or unusual products that can't normally be found in chilled. Marketing services co-ordinator Lorna Marshall-Sully says: "Our new frozen chicken in a batter range offers a plump battered chicken portion whereas the chilled sector usually only has escalopes and flat poultry products." RHM has stepped up its npd activity across its portfolio. Consumer research for Sharwood's highlighted that most frozen consumers base ethnic meal purchases on favourites from local takeaways so it has introduced the House Specials range of Indian and Chinese meals based on popular recipes. RHM says it provides safe experimentation', the key to success in ethnic frozen. In the same vein, it has launched chicken tikka masala and chicken korma in a meal for two' format, and on the snack side it has taken its successful balti bowl concept into two new microwaveable Chinese dishes. In desserts, its Mr Kipling frozen brand has been relaunched to coincide with the massive relaunch of the parent brand with two Summer Slice variants introduced. Cadbury's has new Flake and Caramel desserts based on the countlines. Just how important innovation and investment are in re-energising the market can be seen in fish, a sector that's languished for years but has now shot into growth. This is largely due to the efforts of Young's which has invested heavily in the sector since the brand's major relaunch last November. As well as overhauling its range, it has launched 12 seafood products, ranging from Bantry Bay mussels in garlic butter and battered calamari to whole, fully prepared, rainbow trout, plus a number of salmon meals. This has been backed by £5m media and marketing support which has included a massive instore promotional programme to encourage trial. Group commercial director Jim Cane says this is the first major spend on seafood in years and the results have been dramatic. "Our sales are up 28% year on year, January to May, taking the brand through the £100m barrier, contributing significantly to the fish sector's overall growth. We've been very aggressive, with lots of half-price promotions to provide extra value. "We've also been able to hold our prices, despite EU fish stock difficulties, because we source worldwide." A large amount of the sales growth has come from Young's core products such as Ocean Pie, Scampi and Chip Shop but the new products are now starting to make an impact, says Cane. "People like fish and want to eat more of it but have been held back in the past by having to prepare it. We're making it more accessible, as well as offering them exciting new products." A further six launches are planned for this year, backed by a support package in excess of £5m. Pizza has weathered the challenge of chilled, with volume growth of 11% but a small value growth of 2% caused by discounting. Schwan's marketing controller Ben Johnson says this route to growth is ultimately unsatisfactory. "Reducing prices lower the band for entry at trial," he says. "To excite the market we have taken the route of limited edition pizzas at £1.29." With snacking on the increase, the frozen snack arena offers lots of opportunity. Glendale Frozen Foods md John Mortimer says sales are growing for its microwaveable snacks but believes the level of NPD the sector really requires is being held back by pressure on prices of frozen snacks. "Microwave ownership is high, so the potential for snack development is high, but it's being held back by low price points," he says. On the ethnic snack side, Patak's has achieved success with its new filled naan bread which can be cooked from frozen in 90 seconds. Marketing manager Lucie Morran says products like this appeal to young people because they prefer not to cook. "They have high expectations, but less time" RVP Foods says its Oriental Express Chinese microwaveable meals (rsp: 99p) are doing "phenomenally well", driving the 17% growth in the frozen Chinese meals sector. Doing less well is frozen vegetables, now virtually relegated to a commodity item. Potatoes buck the trend because of the continuing popularity of chips, led by McCain and product innovation. McCain marketing manager Rob Waddel says the company's Wedges have performed well because they offer a convenient solution to the hassle of cooking roast potatoes. "It's also provided the opportunity to address healthy eating by using Maris Piper potatoes with sunflower oil." Another success is Kitchen Range's Golden Wonder Wotsits Mealtime Potato Shapes which the company says have achieved one of the highest rates of sale in the children's frozen potato sector since launch last year. {{FOCUS SPECIALS }}