Forty-three percent of Millennial shoppers said they have purchased more frozen foods this year than last year, according to a new report from Acosta.
The Jacksonville, Fla.-based sales and marketing firm said Millennials with children are leading the increase, and are attracted by the convenience and health aspects of products in the frozen-food section.
"Competition in the category is heating up as fast-paced Millennials, who often take greater interest in the health benefits of food than older generations, look to frozen as a way to eat well in a convenient and hassle-free manner," said Colin Stewart, senior VP at Acosta.
Millennials see frozen foods most valuable as quick dinner solutions (89%), convenient breakfasts for kids (81%), side dishes (78 percent) and convenient lunches (72%).
The increase in purchases among Millennials comes as the frozen-food department has experienced a five-year compound annual growth rate of only 0.2%, according to the Acosta report, citing data from Nielsen. Since 2013, unit sales in frozen have declined 6.7%, trips per year are down 5.3%, and units per household are down 13%.
Dollar sales have basically been flat, with a 0.9% increase, buoyed by an 8.2% increase in average unit price.
The report noted that the four largest frozen-food categories have all seen unit sales decline, including prepared foods, which accounted for 41.7% of the unit sales decline, and desserts, vegetables and pizza.
Among survey respondents who anticipate buying more frozen foods in the coming year, 41% cited convenience as the reason why, and 32% said they plan to purchase more frozen foods because they don’t spoil as quickly as fresh foods.
However, 68% of respondents said they feel fresh foods are healthier.
Acosta’s survey found that for shoppers purchasing more frozen foods this year, the following factors are most important in making purchasing decisions:
• No antibiotics: 76%
• Hormone free: 76
• All natural: 73%
• Sustainable: 71%
• Low sodium: 69%
“Retailers and brands should keep in mind that a majority of consumers are looking for quick and easy options, while continuing to search for products that provide variety and health benefits to their households,” said Stewart. “However, frozen foods are one of the few categories that are still more frequently purchased in store than online, so these items just might be the key to drawing shoppers from the perimeter into center store, as shoppers can check many items off their grocery lists at once.”
He suggested that retailers should ensure that the frozen section is easily navigable, and should keep endcap freezers stocked with teaser items to showcase products available in the freezer aisles.
Acosta’s Future of Frozen report was compiled via an online survey of the company’s custom shopper community panel.