Frozen Food: Who is Eating It and Why?
The convenience of the freezer section shocks no one in a first world country. We have good whole food at our fingertips as well as food that is not so whole and very processed in the frozen food section, and it is flying off the freezer shelves and into our basket at lightning speed.
I blame millennials.
Related - Frozen Veggies Worse Than Fresh?
Millennials. No, I am not saying this with disgust. I am talking about younger people without a family unit and very little time for cooking.
Frozen foods are an option for those on the go and those who are single. It is convenient and gives a variety of food options - both good and bad.
Guess what brands are rising?
Leggo of my Eggo. If you're a millennial, you may not remember this phrase, but it was popular when I was growing up. Now, its popular with younger people because of the Netflix series “Stranger Things” in which a girl named eleven has named “Eggos” as her favorite food.
Stouffer's entrees are being eaten at an alarming rate, and I have to say, their French Bread Pizza is on point...
Banquet Foods is as delicious as it is pretty - by pretty it has a new look as well as higher quality food that it is touting in that large freezer case you are looking at in the frozen food section of the grocery store.
These are just some of the brands that are increasing their profitability. Per a Bloomberg report on the frozen food resurgence, Conagra may be thinking of buying Pinnacle Foods Inc. Pinnacle Foods Inc’s revenue comes from brands like Birds Eye and Vegetarian Garden.
This could be a lucrative deal, as Conagra has $7.8 billion in annual sales (one-third is from the frozen food division), and trails only to Tyson Foods Inc and Pinnacle.
The biggest food and beverage giant, however, is Nestle SA. They are the top seller of frozen foods in the US, with brands like DiGiorno Pizza, Lean Cuisine and the like.
These companies are bouncing back after years of decline.
The Frozen Food Era
OK, it's not really an “era” but honestly, there is so much variety that even Amazon is feeling the heat to get in on the frozen food action. You gotta figure, they bought Whole Foods Market Inc and those clients are discerning not only in the contents of the food but the packaging. The problem with online groceries, though, is that it may be harder to deliver than first thought.
Guess who else likes frozen food? Vegans. Yup, they are willing to pay a premium for meatless burgers and tofurkey, and did I mention all the frozen veggies they consume?
Per a Bloomberg report, “Sales of frozen vegetables have been particularly strong, jumping up 4.5 percent in the last year to 3.03 billion.” Birds Eye drives sales for Pinnacle, their parent company-like 7.5 percent in the most recent quarter.
B&G Foods Inc bought Green Giant from General Mills for a colossal 765 million in 2015 and that Green Giant division is making them a lot of green-they were up 13 percent in this recent quarter.
Frozen food is easy, quick and can be an alternative to fresh produce and cooking meals over a stove for hours. In the past five years, there has been a resurgence in the frozen food division and companies are growing at a fast rate - faster than they did five years ago.
Businesses are merging and there is an increase in revenue from frozen foods. It is unknown what sparked this resurgence of frozen foods; however, it is here and it seems like it is here to stay.
Shall we go get some frozen pizza and some Tofurky for dinner? I say absolutely yes to the pizza; not so much to the Tofurkey...