Seven things you need to know about Frozen Food

1. Frozen foods are growing in sales and importance

2. Consumers are switching from fresh to frozen

3. Veg is the star of the freezer 

4. Frozen is benefitting from shoppers staying in more

5. Premium brands are stealing shelf space

6. Meals made with meat alternatives are rising

7. Retailers are giving more space to frozen

1. Frozen foods are growing in sales and importance

The frozen category is worth £344m in independent retail, according to data from TWC. Growing by 5.5% in value sales in the past year, the category is bigger than many other core convenience staples, such as bread & cakes, news & mags and food to go. 

Lumina Intelligence’s Convenience Tracking Programme shows that the category is also growing in importance as a footfall driver. The percentage of people who stated frozen food was the main reason they visited their local store has grown by 1.4ppts year on year, with the average frozen shopper spending £6.92 per visit (Lumina). 

Convenience stores are well placed to capitalise on this growth too. While supermarket sales of frozen food declined in the four weeks to 24 June, convenience stores saw their frozen market share grow by 1.1ppts, according to data from Circana. 

This is despite convenience stores being 32% more expensive than supermarkets in frozen food (Circana).

Joe Stamper, of Davidsons Garage & KeyStore More in Penrith, Cumbria, says: “Frozen is very important to our shop and we dedicate about a fifth of our store space to the category. We’re in a price-sensitive area, so we have to price very keenly, but because we’ve always done that, in the past year our sales have been steady.”  

Data from Circana shows that in the four weeks to 24 June, the average unit price change in frozen was 15.9% vs a year ago. In the 26 weeks to 24 June, that figure stood at 17.1%, indicating that inflation in the category may be slowing down.

In June, own label sales were down -1.2% as shoppers moved towards branded products (Circana). “We’re seeing private label share shrinking due to shoppers moving to branded products,” says Alex Lawrence, senior strategic insights director at Circana.

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2. Consumers are switching from fresh to frozen

One factor driving sales in frozen food is their comparatively cheaper prices than chilled food. “With the cost-of-living crisis, consumers are now getting accustomed to switching from buying fresh products to frozen meals as the cheaper option,” says Kenton Burchell, group trading director at Bestway.

“The uncertainty that has defined the global economy in recent years has led to significant changes to the behaviour and habits of consumers,” agrees Marcelli GN Ferreiri of chicken supplier Seara Meats. “They have started seeking alternative options for their grocery basket and are now rethinking their usual food choices, wanting to adapt their eating and purchasing habits to this evolving food market.” 

He claims that frozen chicken is becoming a consumer favourite, citing Kantar data showing a rise in volume sales, up 5.9% in the first quarter of 2023. 

The biggest increase in frozen sales has come from a type of consumer that Lumina Intelligence categorises as “busy providers”, with a growth of 3.2ppts buying from the category in the 12 weeks to 25 June (Lumina). These people are defined as working full time and living with their children.

“Frozen food is a footfall driver,” says Alan Kasch of Costcutter, Fernhill Heath in Worcestershire. “You have to get the balance between footfall drivers and profit drivers right and frozen is definitely a category where you have to price keenly. We’ve got a great own-label chilled range, but it can be a bit pricey, so our frozen products give shoppers a choice.”

Rupert Ashby, chief executive of the British Frozen Food Federation (BFFF) says there’s an opportunity to keep these customers coming back to frozen. “There is no doubt that the rising cost of living has squeezed household budgets and consumers are looking for better value during their weekly shop. As they purchase more frozen food, and some try frozen products for the first time, I am confident that the quality of frozen food will speak for itself to encourage consumers to make even more trips to the frozen aisle over the coming months.”

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3. Veg is the star of the freezer 

One of the main drivers of growth in the frozen category is vegetables, prompted by a shift in consumers eating healthier. According to Lumina, the biggest year-on-year growth in importance for product consideration for frozen is “health”, up by 3.4ppts from 2022. 

TWC data shows frozen veg is one of the fastest-growing sub-categories in convenience, outstripping meat, fish, and frozen desserts. 

“75% of frozen food purchases are vegetables, perceived as being healthy and better value [Acosta],” says Kenton Burchell, group trading director as Bestway. 

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4. Frozen is benefitting from shoppers staying in more

After veg, the other top-three best-performing categories according to TWC are frozen pizza, up by 10% in value sales, and ice cream, up by 8% [TWC].

Michelle Frost, general manager at Mars Chocolate Drinks & Treats, says: “We’ve seen an increase in Mars [ice cream] multipack sales, up by 39% year on year [IRI]. This suggests that consumers are increasingly looking to enjoy ice cream as an at-home treat, not just when the weather is warm.” 

Alan has seen an increase in big-night-in buying in his store. “Our frozen section has really picked up in the past few months due to its lower prices than chilled. Pizzas are our bestseller, and we’re always pushing big night in bundles.” Costcutter’s latest Feed The Family For £6 bundle includes Goodfellas and Ristorante pizzas, Birds Eye Chicken Nuggets, McCain Wedges and a Solero multipack. 

“For the past 12 months, the Big Night In has been successful when it comes to buying frozen foods,” says Bestway’s Burchell. “Meal solutions consisting of a main meal, a side dish and dessert for a promotional price are popular.”

Meanwhile, data from Lumina intelligence shows there’s been a 2.4ppt increase in those buying frozen ready meals in convenience. 

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5. Premium brands are stealing freezer space

It’s not just cheaper prices that shoppers are looking for. Even though consumers are cutting back on eating premium meals out, that doesn’t mean their taste for quality has changed altogether. “Where a few years ago frozen foods were seen as just standard kitchen staples, premium brands are driving value and shoppers are expecting more from frozen,” says Alan.

Brands are moving in on the freezer to fill the gap. “As people change the way they shop, the desire for premium convenience is growing,” says Matt Whelan, Fieldfare managing director. “The combination of innovation, focus on taste and quality, coupled with the convenience factor, makes premium frozen foods really appealing to the modern shopper.

“Additionally, the potential cost saving opportunity and added discoverability that it brings to the retailer, makes fine frozen the most desirable new-old kid on the block.”

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6. Meals made with frozen meat alternatives are rising

Consumers are continuing to cut down on the amount of meat they consume at home, with meat alternatives continuing to rise. The number of meals made with frozen meat alternatives has increased by 24 million a year since 2020 (Kantar), with bigger pack sizes driving growth as they provide more value. 

Gill Riley, marketing director at Quorn Foods, says: “Consumers want meat-free options to inspire and excite them even as they look to make the family food budget stretch a little further. Shoppers don’t want to compromise on the core values of taste, texture and health.”                                                                                       

Roughly three in 10 consumers now follow a vegetarian, vegan, pescatarian or flexitarian diet [YouGov], indicating a great opportunity for convenience stores who can become a destination for these shoppers. The Frozen Food Report 2022, compiled by the British Frozen Food Federation shows vegan and vegetarian products have grown by 16.8% since 2019.

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7. Retailers are giving more space to frozen

Research by KAM Media has found 43% of retailers have seen demand in frozen food increase. As a result of all this growth and activity, retailers are dedicating more space to the category in their stores. “Retailers are creating space to make way for the frozen destination for consumers in the store and investing in bigger freezers to accommodate new ranges of frozen products,” says Burchell. “Retailers are investing in closed cabinets with a high visibility of frozen meals.”

At Costcutter Fernhill Health, soaring frozen sales is prompting Alan to consider which categories he could reduce to add more freezers. “We could probably reduce the news & mags space to make more room for frozen,” he says.

“People are returning back to frozen and there’s so much good quality it’s well worth investing in.”

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