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    Thinking Outside the ICEBOX

    Demographics, demands for added value driving design of packaging for refrigerated and frozen foods.

    By Jim Dudlicek, EnsembleIQ
    Eggo Bites Pancakes, in single-serve microwaveable pouches, reflect an ongoing demand for convenience.

    Overall food trends are being reflected in their packaging, from specific characteristics shoppers are seeking to that all-important demographic that promises to dominate the retail scene in the not-too-distant future, and products in the refrigerated and frozen sections of the grocery store are no exception.

    ?The characteristics of Millennials will help guide trends in packaging,? says Andy Anderson, dairy category manager for Tyler, Texas-based supermarket chain Brookshire Grocery Co. ?Products and packaging will do a great job in telling a story that creates loyalty, but it must be different and innovative. This is in part why a retro package with a modern design or graphic and a healthy offering will have broad appeal.?

    For brands to matter to Millennials, ?average? is no longer enough, asserts Julie Henderson, VP of communications for the Harrisburg, Pa.-based National Frozen & Refrigerated Foods Association (NFRA). ?A whole new level of engagement, authenticity and purpose is necessary.?

    Citing a July 2014 Mintel food packaging trends report, Henderson notes that Millennials are looking for information about sustainability in manufacturing and packaging, as well as recycling information on the package. ?Younger consumers, specifically those 18 to 34, are more likely to look for functional packaging, including packaging that you can cook food in. This type of packaging reduces preparation time, as well as the amount of equipment required to prepare food.?

    The report continues: ?Future growth of the frozen and refrigerated categories will be dictated by innovation efforts and connecting with consumers who matter the most, along with the ability to create demand across diverse population segments.?

    Clean Labeling

    Consumers are more educated than ever regarding labeling and nutritional facts, ?and if they?re not, the information is at their fingertips,? notes Dave Marcus, Brookshire?s frozen category manager. ?Because of this, we are seeing reductions in ingredient statements, reducing the amount of additives and ingredients consumers are not familiar with. We are also seeing more callouts on the front of the package for protein content, lower salt, gluten-free and other health-related attributes.?

    Anderson notes that the continued development of added benefits in conventional items is a current trend. ?We see some of this in dairy with added protein, all-natural stabilizers and even which sweeteners are used,? he says. ?Although health is a concern of the consumer, indulgence is also a purchase motivator.

    According to Henderson, food has become a ?badge of values,? and consumers want to know where their food comes from and how it was processed. ?Product claims related to fat content and natural ingredients make up the largest dollar sales for products with health claims,? she says. According to Nielsen LabelTrends, this includes claims that are called out on the product packaging, but doesn?t include any claims listed in the Nutrition Facts panel.

    Examples cited by the NFRA: Pinnacle Foods? sustainable farming process for its Van de Kamp?s and Mrs. Paul?s brands? 100 percent whole-fish filets, and Smart Balance Purely Better spread, free of trans fats, artificial preservatives and GMOs.

    ?Clean-label claims are tracked on nearly a quarter of all food and beverage launches, with manufacturers increasingly highlighting the naturalness and origin of their products,? Henderson notes. ?With growing concerns over the lack of a definition of ?natural,? however, there is a need for more clarity and specific details. Frozen and refrigerated foods perfectly fit this trend. Frozen foods are made from real ingredients picked at the peak of ripeness and flash-frozen. Refrigerated foods are made from real, simple, fresh, farm-grown ingredients.?

    Retailers are stressing health-and-wellness messaging in their store layouts, product assortment and advertising, Henderson adds. ?As consumers become more discerning about what they eat, manufacturers, retailers and distributors all have to address issues like quality, taste and nutrition, as well as take responsibility for proper handling to keep frozen and refrigerated foods at their peak of quality,? she says.

    Convenience

    A continued demand for more convenient sizes and other physical qualities also is impacting refrigerated and frozen food packaging.

    ?As household size declines, consumers are asking for smaller, convenient sizes; longer shelf life; and even aseptic qualities pertaining to dairy products,? Anderson says. ?Single-serve can range from a 4-ounce to a 24-ounce package, while convenience can mean a bundle of individual serving-sized packages for families with children. In addition, seniors are needing easy-open or resealable packaging.?

    Convenience factors significantly into consumers? purchasing decisions, affirms Sean Brady, marketing director of ready meals for Duncan, S.C.-based Sealed Air?s Food Care Division. Brady notes that the ?2014 Power of Meat Report,? an annual Sealed Air-sponsored consumer survey commissioned by the American Meat Institute (AMI) and Food Marketing Institute (FMI), found that retailers sold more heat-and-eat and ready-to-eat items in 2013 than in each of the five previous years. ?With this growth in demand comes added pressure to deliver packaging features and formats that accommodate consumers? busy lifestyles,? Brady says.

    But despite the addition of convenience-friendly features, Brady admits that expanded flavor profiling ? and not the packages themselves ? is responsible for the greatest shift in the refrigerated and frozen food segment. ?Retailers can now offer a broader range of regional and international meals to accommodate consumers? broadening tastes,? he observes. ?Additionally, these formats enable retailers to capitalize on seasonal, limited-time-offer and specialty diet options.?

    Tom Domaracki, senior dairy category manager at Sunbury, Pa.-based Weis Markets, notes that home storage is a factor. ?Manufacturers are designing more space-efficient packages that allow us to offer more variety to our customers in the same amount of space. These new packages also make it easier for customers to save space in their own refrigerators and freezers. Resealable, stand-up packaging is also a new trend that not only allows for space savings, but also allows customers to only use what they need, while the rest can remain fresh for future meals.?

    Busy lifestyles have led Americans to snack more than ever before, and manufacturers are making it easier for consumers to decide if a given food product constitutes a meal or snack, Henderson observes, whether identified from the packaging, portion size or type of ingredients. For example, breakfast items are packaged in single servings and stand-up pouches to influence ?anytime, anywhere consumption.?

    Convenience categories lead the list of top-selling frozen food products, with $14.1 billion spent on frozen prepared foods, $5.2 billion spent on frozen vegetables and $2.1 billion spent on frozen baked goods, according to NFRA. ?With a variety of foods and beverages, the refrigerated dairy aisle is home to endless snacking possibilities,? Henderson adds. ?Connecting with the strong growth in consumer snacking demand, snacks, spreads and dips found in the dairy case have seen back-to-back years of sales growth with higher prices and increased promotional support.?

    Some examples in this area: Eggo Bites Waffles, in a single-serving microwaveable pouch, ready in 30 seconds and maple-flavored so they can be enjoyed without syrup; Crystal Farms Nibblers, a line of flavored cheese snacks in single-serve, 1.5-ounce, stand-up bags; Bob Evans Breakfast Bakes, individually wrapped for a convenient breakfast on the go or a hearty snack that?s ready after less than four minutes in the microwave; Stouffer?s Mac Cups, macaroni and cheese in three flavors and microwaveable in three minutes; and Drumstick Minis frozen novelties.

    Such products reflect a trend toward miniaturization, according to Roz O?Hearn, communications and brand affairs director for Solon, Ohio-based Nestlé USA. The demand for snacks and mini-size products is ?driven by Millennial shoppers who value natural/organic and sustainability, and do not eat the traditional three square meals a day, but instead graze throughout the day,? O?Hearn explains. ?Miniaturization is also driven by the move away from low-fat, low-cal dieting towards eating smaller portions of the real thing.?

    New and Reinvented

    Packaging has become a popular way to launch ?new products.? According to the NFRA, new food product packaging has increased 89 percent since 2009, while the percentage of new products has declined 37 percent. ?Rather than introduce completely new products, manufacturers opted for repackaging their existing products to attract new audiences,? Mintel reports. Some examples: Ore-Ida Tater Tots? 60th-anniversary packaging, available between July and November this year; Mrs. T?s Pierogies? Pittsburgh Steelers on-package promotion; and Unilever North America?s recent relaunch of its I Can?t Believe It?s Not Butter! spread in a redesigned recyclable rectangular tub that?s not only more space-efficient in the refrigerator, but also top-rack dishwasher-safe so the container can be reused.

    Ian Speck, frozen category manager at Weis Markets, says the greatest concern for retailers is more efficient packaging. ?Customer demand for variety grows daily, and no retailer can afford to expand every store in a chain to keep up,? Speck says. ?Thus, the best alternative lies with the manufacturers to create space-saver packaging.? For the retailer?s part, Speck says Weis Markets is trying to reduce case packs to get better turns. Meanwhile, he adds, ?We?re seeing more stand-up gusseted bags with tighter footprints and more multidirectional boxes to help with pack-out on shelves.?

    Packaging innovation represents a significant growth opportunity for retailers ?willing to view it as more than a cost of doing business,? says Sealed Air?s Brady. ?While breaking away from traditional formats may require time, equipment and resource investment, retailers benefit when operational efficiencies throughout the supply chain enable smoother delivery of convenience, cost efficiency and quality to consumers.?

    Brady says vacuum packaging can address freshness and quality concerns; it?s ideal for meat and poultry, as consumers are likely to store these items in the refrigerator or freezer before they prepare them. Used for case-ready red meat and poultry, the Cryovac Darfresh on Tray package features a leak-proof vacuum seal that preserves freshness in a refrigerator or freezer; its 3D vertical product display enhances merchandising by granting consumers a clearer view of the product inside.

    ?While some U.S. retailers have been hesitant to fully embrace new packaging innovations for frozen foods, there is still a significant opportunity to leverage them for growth in a challenging segment,? Brady says. ?The next big thing for the refrigerated and frozen foods segment may not be a new package itself, but rather a better understanding of how to utilize the innovative technologies that are already available on the market.?

    ?Products and packaging will do a great job in telling a story that creates loyalty, but it must be different and innovative.?
    ?Andy Anderson, Brookshire Grocery Co.

    ?While some U.S. retailers have been hesitant to fully embrace new packaging innovations for frozen foods, there is still a significant opportunity to leverage them for growth in a challenging segment.?
    ?Sean Brady, Sealed Air

    By Jim Dudlicek, EnsembleIQ
    • About Jim Dudlicek As editor-in-chief of Progressive Grocer, Jim Dudlicek oversees daily operations of the magazine, spearheads its signature features, produces PG’s monthly Trend Alert newsletter on center store issues, moderates its regular webcast series, and writes and comments about a wide range of grocery issues. A food industry journalist since 2002, Jim came to PG in June 2010 after covering the dairy industry for 7½ years, during which time he served as chief editor of Dairy Field and Dairy Foods magazines. A graduate of Marquette University, Jim is fascinated by how truly progressive grocers inspire consumers to enjoy food, transforming the industry from mere merchants into educators that can take the most basic of all necessities and turn it into something profound and life-enhancing.

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