The Grocer’s 2017 Top Products Survey, THE definitive guide to the current state of the UK’s grocery industry

At last, some good news! Much needed value is being driven into supermarket freezers. Sales of frozen food including ice cream and ready meals are up £91.2m (3.2%). That volumes are more or less flat (down just 0.1%) suggests retailers and suppliers are succeeding in convincing shoppers that frozen food is worth paying that little bit more for. So how are they doing this and who is to thank for frozen’s continuing success?

It’s a mixed bag. While pizza and fish are in value and volume growth, other areas, such as frozen desserts and pastries, are struggling to keep pace in a market that’s still battling the perception that fresh is best. The winners on these pages, however, are pizza and fish, up £10.2m and £28.4m respectively.

Own label is the fastest grower in pizza, having added £9m. “Own label has really stepped up in terms of quality and range breadth in the last year as the major retailers continue to fight the discounters,” says Claire Mitchell, head of category and marketing at 2 Sisters Food Group. “This poses a real threat to brands as consumers have increasing amounts of choice at competitive prices.”

The biggest casualty of own label’s growth, driven primarily by more premium lines such as stonebaked and thin ‘restaurant style’ lines, has been Dr Oetker’s Chicago Town, which has lost £2.8m (2.5%) as volumes slid 3.5%. 2 Sisters’ Goodfella’s brand only fared marginally better, with a 0.1% dip in value driven by higher prices; volumes have sunk 0.8%. Meanwhile, the group’s smaller, cheaper brand San Marco saw value and volume grow by 9.3% and 9.4% respectively.

Pricier pizzas are the real winners among the brands, however. Dr Oetker Ristorante, which sells for an average of 29.1% more than the market average, is the fastest growing frozen pizza brand this year, up £4m. Pizza Express’s first foray into the freezers, which began in late summer with an exclusive Iceland deal, is also proving fruitful. It’s racked up £700k in a matter of weeks.

Over in fish, brands are flying, their combined sales contributing £19.9m to the sector’s overall growth. Birds Eye has delivered most, with its core lines surging by £10.2m (8.5%) on volumes up 6.8% as the brand has trumpeted its quality and introduced value-added lines, such as the gluten-free frozen fish fillets it launched this autumn.

But the pricier Birds Eye Inspirations line is struggling, with volumes down 9.3%. The brand is looking to address this with a multimillion pound campaign. “One trend we’ve seen is that while consumers want to eat more fish, they’re not overly confident in preparing it,” says UK marketing director at Birds Eye Steve Challouma. “We have plans to turn this around by investing in the wider recipe fish category and introducing new core products to drive incremental growth.”

frozen food

“Stupid, middle-class people think chilled is better than frozen.” So said Iceland boss Malcolm Walker last year. In April, our research leant some credence to Walker’s words, with 36% of those in social grades A and B saying frozen food was inferior quality to fresh, versus 28% of C, D and Es [Harris Interactive]. So class does influence attitudes to frozen. Whether stupidity does too is yet to be proven…

Given the wider economic picture, premiumisation backed by big marketing investment makes sense. “Along with a weakened pound, there have been unprecedented levels of inflation particularly in raw materials,” says Jason Manley, head of frozen at Young’s, which has seen sales falter for its standard range, while the pricier Gastro and Chip Shop lines have turned in combined growth worth £7.7m. “Health and premiumisation will remain very important.”

The category’s standout NPD this year came from chilled stalwart The Saucy Fish Co, which branched into the frozen aisle in February. It achieved sales of almost £900k in the seven months to September. The brand said some 77% of its sales had been incremental to Sainsbury’s frozen fish category since launch, and it’s now widened distribution to Tesco and Amazon Fresh.

Frozen potatoes have also been the scene of plenty of premium innovations, which have helped drive slight (0.3%) value growth on volumes that slipped 2.7%. Market leader McCain has increased share, with its four biggest lines growing 0.4% on volumes down 0.5%, thanks in part to a steady stream of value-added NPD, such as ridged wedges aimed at evening sharing occasions.

But McCain category controller Naomi Tinkler suggests retailers could be doing more to drum up excitement about such offerings. “Consumers are often unaware of the variety available when it comes to frozen food and, when shown the whole range, they are pleasantly surprised,” she says. “Stores must be encouraged to point out the full breadth in-store to drive growth of the entire category.”

Frozen desserts might benefit from such a move. The sector has lost £8.3m, the greatest loss in frozen food. You don’t have to look far to find what’s replacing Viennetta and Aunt Bessie’s in the freezers and shoppers’ baskets: ice cream, which typically carries a much higher price per unit than traditional desserts. Such products are also suffering from the decline of larger households and traditional sit down meals and ice cream brands’ efforts to muscle in as a dessert option.

“Retailers have started to embrace frozen meal deals,” says Charlotte Hambling, UK marketing head at ice cream manufacturer Froneri. “They are dedicating more space to frozen meal deals as another way to offer shoppers value and drive footfall.”


weightwatchers balance

WeightWatchers Balance by Kraft Heinz

For once WeightWatchers wants to pile on the pounds, and given the success of rival Slimming World’s frozen food range, it’s in with a good chance. The range’s eight meals - including Mediterranean chicken pasta and chicken & chorizo paella - reflect the growing reliance of slimming brands on positive messaging that emphasises quality over the absence of calories, fat and other nasties. With a premium feel and mid-tier pricing, we reckon WeightWatchers is on to a winner.

The Grocer Top Products Survey 2017: Up!