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Where Do We Go From Here?

Retailers have been operating in crisis mode for more than a year. Now that the pandemic is finally winding down, what’s next for frozen foods?

After a year spent scrambling to keep freezers full, employees safe, and online platforms humming, retailers finally see a light at the end of the pandemic tunnel. But will the long-awaited return to “normal” bring a reversal of fortune for a frozen food department that saw sales jump 21% last year? For some categories, particularly those that were already in decline pre-pandemic, the answer is probably yes. (Sorry, orange juice concentrate — it was nice while it lasted.) Numerator’s new Grocery Vulnerability Index, which measures the impact of increased out-of-home dining on supermarkets and other food retailers, says meat and dairy are also likely to see decreases.

HALF PLAN TO COOK MORE

But many experts think frozen foods have a good shot at retaining the gains made last year, with frozen breakfast foods and family-size meals topping the list of likely long-term gainers. For one thing, only 7% of consumers said they expected to cook less post-pandemic while almost half planned to cook more. The fact is, some of us developed mad skills during our time at home — sales of cookbooks were off the charts — and we’re eager to show them off. Plus, many consumers invested in countertop appliances like waffle irons, air fryers and single-serve coffee makers that make home cooking almost as convenient as hitting the drive-through on the way to work — and much less expensive. And now that we know we can have groceries delivered right to our doors for a nominal fee, well…who wouldn’t like that?

What can you do to keep the good times rolling? Experts say it may be time to ramp up promotional activity. While 2020 consumers were all about speed, for the first time since the pandemic began, Americans are once again prioritizing value, according to recent research by dunnhumby. Just having products in-stock will no longer be enough to get a sale. Retailers have to sell it.

Another key to continued success in the frozen department is encouraging consumers to buy across a greater number of categories. So try cross-merchandising pandemic favorites such as frozen snacks or frozen shrimp with other, less popular frozen foods. Industry observers also recommend meal solution displays or recipe ideas that mix fresh and frozen, so consumers begin to see frozen foods as staples that belong on the weekly shopping list, not just backups.

And go after Millennial shoppers who recently discovered their love for frozen food. In fact, a recent study by Nestlé found that 35% of all consumers — but 49% of Millennials — said they would bring a frozen meal to work for lunch when it’s time to return to the office. But Gen Y expects high quality, better-for-you options, so continue to add more plant-based alternatives, immunity boosters (bone broths, superfruits, etc.), and global fare to the frozen assortment.

HELP NEW HABITS STICK

While the end of the pandemic will certainly see some consumers return to restaurants, some of the at-home habits they adopted during the past year are likely to stick. But retailers and manufacturers need to do their part. If we play our cards right, the frozen food industry can turn the lemon that was 2020 into lemonade — or better yet, frozen lemonade concentrate.

Denise Leathers

Denise Leathers

Denise is the Editorial Director for Frozen & Refrigerated Buyer.

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