Why Retailers Should Get Fresh With Frozen

No category is an island. Sometimes, however, creating an island of products in another category can be a bridge to higher overall sales and greater intra-store integration.

When mulling over ways to cross-promote the frozen aisle with the fresh perimeter, for example, grocers might consider bringing some frozen products to the fresh department. “That can be a simplistic and advantageous way to cross-promote fresh and frozen,” remarks Jonathan Raduns, consulting partner at Merchandise-Food.com, in Cherry Hill, N.J. “The produce department is better situated to have a mobile freezer, and it’s a way to accentuate a frozen item by surrounding it with fresh components.”

When it comes to departmental interplay, merchandising fresh items in the frozen section is a harder go.

“Shoppers may think it’s weird that they are tripping over fresh food in the frozen aisle,” admits Terry Roberts, president of Merchandising by Design Inc., in Sarasota, Fla. “Seasonality is the most reasonable way to do it, and it can make sense to shoppers. For example, if you have bushels of peaches that come in, you can put a bushel by the ice cream, with recipes for peach cobbler a la mode. Or, during succotash season, you could place baskets of zucchini and squash in the frozen area near other ingredients, like frozen lima beans.”

Roberts adds a food safety caution: “You have to be careful with things that do and don’t need refrigeration or freezing.”

That care extends to other aspects of physically co-merchandising fresh and frozen items, Roberts adds. “It requires planning and management,” she advises. “You need to sit down with a seasonal calendar, planning what comes in and out — and that includes meat and seafood — and how to do promotional activity accordingly.”

Make it a Meal

Other grocery analysts agree that marrying frozen and fresh items warrants consideration due to logistics and food safety, given temperature requirements. “To actually do cross-merchandising — putting product where other product is — could be difficult,” notes Stockton, Calif.-based produce consultant Ed Odron. “But there are ways to increase sales in both departments.”

One way to do that, according to Odron, is through price promotions. “You can do cross-merchandising by price point — for example, if you buy a produce item, you get ‘X’ amount off a frozen food, or if you buy a frozen food, you get ‘X’ amount off a fresh food,” he says. “You can put signage by fresh strawberries and, in the frozen section, by the Cool Whip, with that kind of offer. Or you could do a similar price enticement with apples and frozen pie shells.”

Such offers allow consumers not only to save money, but also to fulfill their interest in making quick meals that they can have some ownership in serving. “Frozen pizza can be a great item, topped with fresh basil and fresh peppers that you can add on your own,” Odron notes.

Raduns agrees: “There is a trend of pulling different elements into one meal. Millennials are looking for the speed of being able to produce more flavor-focused entrées and menu items quickly, but with the capability to customize them.”

At a time when delivery services like Blue Apron and others are garnering interest among consumers, stores can provide real meal kits with ingredients that cut across frozen and fresh departments, as well as virtual meal kits, with suggestions and recipes for combining ingredients into a meal.

“We are seeing an uptick in retailers offering meal kits and solutions that resemble kits, and I think an opportunity exists for people to begin to include frozen along with fresh in combination in a meal kit that answers the question, ‘What’s for dinner?’ to make meal planning and execution easier and more convenient,” observes Bill Bishop, chief architect and co-founder of Brick Meets Click, a consulting firm in Barrington, Ill.

Embracing Innovation

Julie Henderson, VP of communications for the Harrisburg, Pa.-based National Frozen & Refrigerated Foods Association (NFRA), agrees that providing consumers with ideas on how to combine fresh and frozen ingredients can lift sales in both categories, and suggests employing such elements as signage, sampling and social media.

“There can be opportunities to cross-merchandise frozen foods with other departments in the store, including fresh produce, with a little creativity,” she says. “For example, encourage shoppers to up the wow factor of their salads any time of year by adding frozen edamame, frozen peas or frozen mango chunks, which are always available and at peak quality, no matter the season.”

Meanwhile, as part of NFRA’s Real Food. Frozen PR campaign, consumers are targeted with messages like how to assemble meals using frozen foods along with from-scratch fresh items.

Another way to leverage the strength of the fresh perimeter and the frozen section — and to provide solutions to busy shoppers looking for ideas — is to create a display that ties in both areas. “You could have a frozen end cap with ice cream, and put ice cream cones and sundae toppings around it, and merchandise that with fresh ingredients like berries or bananas, for an innovative merchandising approach,” Raduns recommends.

Other industry innovations may lead to a greater fusion between the fresh perimeter and frozen. Burt Flickinger, managing director of New York-based Strategic Resource Group, points to work that Cornell University is doing for a major food company on hydroponically grown produce.

“Retailers can cross-merchandise hydroponic produce and flash-frozen foods to stimulate sales,” he notes, adding that innovations in product development and merchandising are spurred by competition from many parts of the grocery and retail sector. “We are seeing from analyses of Lidl in the U.K. that they are aggressively and progressively working in this area,” he observes. “And … the talent that Amazon is hiring, along with Whole Foods, will make it a bigger player in that, too.”

Ultimately, leveraging seemingly different but potentially complementary categories provides shoppers with solutions for their meals, snacks, desserts and other need states, and tracks with grocers’ goals. Asserts Roberts, “The benefits can be enormous in customer satisfaction and basket ring.”