Frozen food 2022: long-term behavioural shift paying dividends

Under normal circumstances, a £119.8m decline on volumes down 10.7% – the combined loss of the six frozen food sectors measured – would spark panic in supplier HQs. But things haven’t been normal for quite some time.

You have to go back to our 2019 report to find something resembling normality in retail. That’s when frozen food’s performance takes on a different complexion. Compared with 2019, this year’s sales are up £174.5m. And, for once, it’s not all down to inflation.

“We’re seeing a long-term shift in both shopper behaviour and perceptions towards the category, as more shoppers than ever are seeing the freezer as a credible and reliable option for quality meals,” says Birds Eye marketing director Jim Shearer.

“In-home frozen meal consumption is up 9% since 2018 – the equivalent of 80 million additional occasions – and, as we move into a period of economic uncertainty for many, it’ll continue to be a much sought-after category.”

There are several reasons why frozen is much sought after. The first is lockdowns, which led to Brits shopping less often and buying more. The longer shelf lives of frozen food suited this new behaviour, and it’s stuck.

That lots of people still spend time at home during the day is another factor, adds Shearer. “Frozen is being used in more meal occasions outside the traditional evening meal,” he says. “There’s been 19% growth of lunchtime occasions featuring frozen food in the past two years.”

Savvy NPD has also played a crucial role in Brits’ reappraisal of frozen. With budgets squeezed and fewer people eating out compared to before Covid, it’s significant that nascent restaurant-branded lines feature heavily among the year’s best sellers.

Iceland’s Harry Ramdsen’s range, one of several exclusive restaurant brands launched into the retailer in 2021, is the year’s fastest grower. Its frozen fish, chips, pastries and veg lines have put an extra £12.9m through the tills – a rise of 191.4% to £19.6m.

“One of the things we are aiming to do is build credibility into the market with innovation through our exclusive brand and luxury ranges,” Iceland trading director Andrew Staniland told The Grocer earlier this year.

“There’s been a big shift in recent months in meat and poultry to more value-added products. So, rather than buying plain chicken breasts, for example, people are buying hunter’s chicken and the like. Even with the return to casual dining, the innovation we have implemented in the past year is continuing to grow.”

Ramdsen’s isn’t the only Iceland exclusive climbing up the rankings. The retailer’s TGI Fridays frozen pizzas are the year’s second-fastest grower in absolute terms across all of frozen, having added £4.8m. Ed’s Easy Diner frozen potato products are the sixth-fastest grower, up £2.9m.

Still Iceland’s exclusives are not without competition. Take Crosta & Mollica’s posh pizzas listed by Tesco, Sainsbury’s, Morrisons and Waitrose. They’ve more than doubled their value, adding £4.4m to hit £8.1m. Another highlight has been restaurant brand Zizzi’s frozen pizzas, which rolled into Tesco in March and have since racked up £3.5m.

Then there’s Leon’s grocery versions of its most popular restaurant lines. They were bolstered by the March unveiling of Garlic Aioli & Rosemary Waffle Fries (see Top Launch). The brand’s frozen potato products are now worth nearly £1m, having grown 44.8%.

“Recreating restaurant dishes at home is a trend we expect to continue, as customers look to recreate their favourites in a more cost-effective way without compromising on taste,” says Ashley Davis, MD of Leon Grocery. The brand’s latest Waffle Fries variant “has driven incremental sales and helped to improve visibility for our Original Waffle Fries,” she adds.

Pukka Pies is another brand betting on greater demand for wallet-friendly products. Its frozen pastries have enjoyed growth of 14.5% to hit £5.2m, and it’s eyeing further gains following the September launch of frozen bakes and sausage rolls.

“Shoppers are finding ways to manage their expenditure,” says Pukka MD Isaac Fisher. “Part of this is reducing waste and freezing items, as well as shopping frozen categories more often to help manage the bigger challenges they now face.

“Indeed, given the challenges that inflation and energy bills bring, it’s no surprise 51% of people say they’re planning to spend more evenings at home to save money, while 53% are planning to cut down on eating out.”

Even big brands in decline after heightened sales during lockdowns seem optimistic about the future of frozen, despite significant cost of goods increases, from oil and fish to fuel and refrigeration.

“We mustn’t forget that sales of standalone freezers grew exponentially during lockdown,” says Mark Adams, senior category manager at Young’s Seafood. “That increased storage space at home still exists now.”

And with energy prices what they are, surely no one wants to be spending money powering a half-empty freezer.