Fresh Convenience Foods in the U.S.

Aug 1, 2010
214 Pages - Pub ID: LA2511642
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During 2008 and 2009, as the “Great Recession” took hold, many consumer product marketers and retailers acted as if the walls were closing in on them, in many cases resorting to rampant price-slashing. But not fresh convenience food marketers and retailers, who instead saw an opening. Wisely gauging their main competition as coming from the restaurant industry instead of less costly unprepared food, they continued the innovations in quality and convenience that had been underway in the market for several years, and simultaneously began aggressively competing on price with the foodservice industry in an effort to woo customers away.

According to Packaged Facts, these efforts proved successful, spurring a shift by many consumers from restaurant meals to prepared food purchased at retail outlets. As a result, the market for fresh convenience foods grew by 5.1% in 2009 to reach sales of $22.3 billion. Packaged Facts expects these marketing and merchandising efforts to continue to prove successful over the short term, driving sales of fresh convenience foods up another 28% by 2014 to $28.5 billion.

Fully updated from the December 2007 edition, Fresh Convenience Foods in the U.S. offers a comprehensive look at this complex market. It examines the both myriad types of fresh convenience foods and the myriad retail channels through which they are obtained—from traditional outlets such supermarkets and supercenters/mass merchandisers to such increasingly dynamic segments as convenience stores, delis and local food outlets, drugstores, the Internet, and even food carts.

This full updated report details the complex changes that have taken place in the market since the previous edition, with new attention to competition by retail sector. Using Symphony/IRI mass-market sales tracking data, it offers detailed accounts of sales and marketer/brand activity across 17 refrigerated product segments, from lunch kits and dinners/entrees to fresh soup and side dishes, while diving into selected segments using SPINSscan data for natural supermarket channel. The report projects sales, market growth drivers, and competitive opportunities, including an extensive account of the battle with the foodservice industry for consumer dollars that details the staggering—and still growing—assortment of menu and marketing trends shaping the industry.

A special feature of this report is custom survey data by Packaged Facts specifically addressing consumer purchasing of fresh prepared foods, including vis-à-vis the down economy. Additional demographic analysis derives from data compiled by Experian Simmons, New York, NY, including demographic indexing of consumers most or least likely to often eat store-made, pre-cooked meals.

Chapter 1: Executive Summary
Introduction
Scope of Report
Two Classifications
Unpackaged Foods
Packaged Foods
Exclusions
Report Methodology
Market Trends
Myriad Modalities of Fresh Prepared Food
Retail Channels Compete with Each Other and with Foodservice
Mega Brands Play Less of a Role in Fresh Convenience Food
Private Label/Store Brands Are Disproportionately Important
U.S. Retail Sales Top $22 Billion in 2009
Unpackaged Food Accounts for Lion’s Share of Market
Figure 1-1: Share of U.S. Retail Sales of Fresh Convenience Foods by Classification, 2005 vs. 2009 (percent)
Supermarkets the Primary Retail Channel
Marketers and Retailers Turn Recession to Advantage
Retail Trends
Take-and-Bake Is Taking Off
Illustration 1-1: Papa Murphy’s Website Banner for Take ‘N’ Bake Pizza
Going Head-to-Head with Restaurants
Supermarkets: The Top Retail Channel for Fresh Prepared Foods
Small Marts: Tesco Sets the Pace
New Product, Menu & Food Trends
Rate of Introductions
Ready Meals and Salads Are the Most Active Classifications
NRA’s “What’s Hot In 2010” Survey IDs Top Menu Trends
Local Food Holds Broad Appeal
World Cuisine: Ethnic Food as American as Apple Pie
Mediterranean Food
Packaged Food Trends
Fresh Prepared Food Retail Segments
Refrigerated Lunch Kits
Refrigerated Prepared Salad/Fruit/Coleslaw
Refrigerated Dinner/Entrees
Consumer Trends
Though Time-Pressed, Most Americans Are Trying to Eat Healthier
Recessionary Decline in Restaurant Traffic a Plus for Fresh Convenience Foods
Figure 1-2: Impact of Recession on Consumer Cooking and Restaurant Habits, May/June 2010 percent of U.S. adults)
18% of U.S. Consumers Are Buying More Fresh Prepared Foods
Prime Targets: Young Singles Living on Their Own
Chapter 2: Market Trends
Introduction
Market Definition: Fresh Prepared Convenience Foods
Two Classifications
Unpackaged Foods
Packaged Foods
Exclusions
Report Methodology
Market Fundamentals
Myriad Modalities of Fresh Prepared Food
The Lunch Kit Lesson: Freshness and Nutrition Sometimes in Eye of Beholder
Mommy Bloggers Give Meal Kits a Big Thumbs Up
Divergence of Views Underscores Complexity of Competition
HACCP (Hazard Analysis and Critical Control Point) = Prevention
State of the Market
Retail Channels Compete with Each Other and with Foodservice
Legal Sea Foods Covers Supermarket, Restaurant, and Online Bases
Illustration 2-1: Kroger In-store Bistro Columbus Ohio (2009)
Illustration 2-2: Carrabba’s Italian Grill in a Publix supermarket in Sarasota Florida
Mega Brands Play Less of a Role in Fresh Convenience Food
Private Label/Store Brands Are Disproportionately Important
Table 2-1: Private-Label Ranking in 17 Packaged Fresh/Refrigerated Convenience Food Segments (in millions of dollars)
More Retailers Manufacturing Their Own Brands
Some Retailers Manufacturing Other Stores Brands
Market Size and Growth
U.S. Retail Sales Top $22 Billion in 2009
Table 2-2: U.S. Retail Sales of Fresh Convenience Foods, 2005-2009 (in millions of dollars)
Unpackaged Food Accounts for Lion’s Share of Market
Figure 2-1: Share of U.S. Retail Sales of Fresh Convenience Foods by Type, 2005 vs. 2009 (percent)
Entrees Top Unpackaged Foods Chart
Figure 2-2: Prepared Deli Foods: Share of Total U.S. Retail Dollar Sales by Type, 2009 (percent)
Lunch Kits the Top Mass-Market Packaged Segment
Table 2-3: Percent Share of SymphonyIRI-Tracked Dollar Sales of Packaged Refrigerated Fresh Convenience Food by Segment, 2009
Supermarkets the Primary Retail Channel
Figure 2-3: Share of U.S. Retail Sales of Fresh Convenience Foods by Channel, 2009 (percent)
Looking Ahead
Marketers and Retailers Turn Recession to Advantage
On The Food Front
On The Packaging Front
On the Merchandising Front
Targeted Pricing Plus Innovation Equals Profit
Prepared Foods Gain at Convenience Stores
Restaurant Industry Takes It on the Chin
The I Hate to Cook Book: Lessons and Opportunities
Sandra Lee Combines Fresh Ingredients and Prepared Food on the Food Network
Illustration 2-3: Recipe for Sandra Lee’s Creamy Chicken Noodle Soup
Prepared Foods Are a Time-Saving Meal Component
Can Sales of Fresh Convenience Food Continue to Grow?
Will Jobless Recovery Be Enough to Trigger New Product Turnaround?
Projected Market Growth
Table 2-4: Projected U.S. Retail Sales of Fresh Convenience Foods, 2009-2014 (in millions of dollars)
Chapter 3: Retail Trends
Introduction
Retail Distribution Methods
Direct Delivery Advantages
The Cost of Face-to-Face Business
Advantages of Warehouse Delivery
Smaller Marketers Work Through Brokers
Fresh Prepared Foods Can Involve Unique Distribution
Trade Shows Introduce New Products to Market
Types of Retail Channels
Retail Trend Overview
Take-and-Bake Is Taking Off
Illustration 3-1: Papa Murphy’s Website Banner for Take ‘N’ Bake Pizza
Kroger Is an Early Adapter of Take-and-Bake
Overall Deli Pizza Sales Up 15% in 2009
Incentives in Retail Pizza
Going Head-to-Head with Restaurants
In-Store Full-Services Restaurants: Focus on Wegmans’ Pub
Store Brands Dominate 2009 Product Launches
Table 3-1: Leading Marketers of Fresh Convenience Foods by Number of New Product SKUs, 2009-2010 (percent)
Fresh & Easy Focusing on Eatwell Line
Illustration 3-2: Fresh & Easy Website Banner for Eatwell Fresh Prepared Foods
Retail Channel Spotlight
Channel Blurring
Supermarkets: The Top Retail Channel for Fresh Prepared Foods
Bloom: Wave of the Future?
Illustration 3-3: Website Description of Bloom Stores from Shopbloom.com
Small Marts: Tesco Sets the Pace
Health & Natural Food Stores: Retailers Moving Mainstream
Delis and Other Local Food Outlets: Urban Cannibals Bodega and Bites Applies New Spin
Illustration 3-4: Interior of Urban Cannibal Bites and Bodega
Social Media Work Well for Small Food Shops
Illustration 3-5: Sparrow Market Facebook Wall Page
Supercenters, Mass Merchandisers and Warehouse Clubs
Prepared Foods Leads BJ’s Comeback
Convenience Stores: Prepared Foods Becoming Increasingly Sophisticated
C-Store Strategies
7-Eleven Going Strong
Gourmet/Specialty Food Stores: A Tough Competitor in Affluent Urban Areas
Drugstores: Prepared Food Redux
Illustration 3-6: Lunch Counter and Soda Fountain at Hewitt’s Drugstore (Anchorage, Alaska) 1940s
Illustration 3-7: Duane Reade Convenience Food Section, 2009
Illustration 3-8: Sushi Duane Reade Drugstore Style
Walgreens Moves Forward with Chilled Prepared Foods Tests
Dollar Stores: Prepared Food One of Three Top Gainers
E-tailers and Mail Order
Illustration 3-9: Fresh Direct prepared Food webpage
Illustration 3-10: Susan’s Healthy Gourmet Homepage
Illustration 3-11: Google Search Shopping Results for “Fresh Crab Cakes”
Gourmet Food Trucks & Carts: A Great Test Kitchen
Table 3-2: Percent of Adults Who Have Bought Food from Street Stands, Food Trucks or Mobile Food Carts in Past Month: Overall and by Key Demographic, February 2010
Chapter 4: New Product, Menu & Food Trends
New Product Trends: Fresh Packaged Products
Rate of Introductions
Figure 4-1: Number of Fresh Prepared Food Reports and SKUs, 2005-2010
Ready Meals and Salads Are the Most Active Classifications
Figure 4-2: Number of Fresh Prepared Food SKUs by Classification, 2005-2009
New Product Themes
Fresh and Convenient
Illustration 4-1: Olivia’s Organics Single Salad to Go! and Walmart’s Marketside Hoagie
Small Mart and Other Private-Label Brands Going Strong
Value Appeals
Illustration 4-2: Wegmans Alternatives to Eating Out Pulled BBQ Pork, and Fresh & Easy’s Family Size Fully Cooked Big Lasagna with Meat Sauce
Gourmet and Ethnic
Natural/Organic
Kids Foods
Illustration 4-3: Oscar Mayer Lunchables Beef Taco Wrapz, and Natural Foods Corp.’s Better’n Peanut Butter Sandwiches
Table 4-1: Examples of Fresh Prepared Food New Product Introductions: By Type, Marketer and Brand, 2009-2010
Selected Menu & FoodTrends
NRA’s “What’s Hot In 2010” Survey IDs Top Menu Trends
Local Food Holds Broad Appeal
7 Different Aspects of Local Food Trend
Taste
Value
Nutrition
Global Ecology
Freshness
Local Economic Development
Local Vegetables Could Add Green to Local Economies
Food Safety
Informal Focus Group Reflects Packaged Facts’ 7 Aspects of Local Food Appeal
Local Fresh Prepared Foods
Illustration 4-4: Dinners to You Web Page Featuring Dinners with Fresh, Local and Seasonal Ingredients
World Cuisine: Ethnic Food as American as Apple Pie
Mediterranean Food
An Increasingly Diverse Segment
Regional Mediterranean Cuisine
But Mediterranean Often Painted with Broad Brush
Sushi
Sam’s Sushi
Gluten-Free Foods
Why a Gluten-Free Diet?
Gluten-Free Takes on Healthy Halo
Gluten-Free Fresh Prepared Food
Illustration 4-5: Jason’s Deli Gluten-Free Sandwiches Online Survey, 2010
Chapter 5: Packaged Food Trends
Introduction
Fresh Prepared Food Retail Segments
Table 5-1: Selected Segments of Packaged Refrigerated Fresh Convenience Foods: 2009 SymphonyIRI-Tracked Dollar Sales and Percentage Change, 2009 vs. 2008 (in millions of dollars)
Refrigerated Lunch Kits
The Largest Segment, at $771 Million
Top Three Marketers Account for 98% of Sales
Most Top 10 Marketers Show Impressive Growth
Spotlight on Kraft Foods
Focus on Lunch Kits
Table 5-2: Leading Refrigerated Lunch Kit Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Refrigerated Prepared Salad/Fruit/Coleslaw
Sales Up 7.3% in 2009
Lower Tier of Top 10 Marketers Tightly Bunched
Eight of Top 10 Marketers Register Strong Growth
Spotlight on Del Monte Foods
Table 5-3: Leading Refrigerated Prepared Salad/Fruit/Coleslaw Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Refrigerated Dinner/Entrees
Sales Slip a Bit in 2009
Curly’s & Jack Daniels Are Only Top 10 Gainers
Spotlight on Hormel
Table 5-4: Leading Refrigerated Dinners/Entrees Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Refrigerated Appetizers/Snack Rolls
Sales Up 12% to $385 Million
Advanced Fresh Concepts Controls Over Half of Sales
Japanese Food Express Leads Growth Among Top 10
Smaller Marketers Show Explosive Growth
Spotlight on Segment Leader AFC
Table 5-5: Leading Refrigerated Appetizers/Snack Rolls Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Refrigerated Flavored Spreads
Sales up 16% to $312 Million
Mediterranean Dip Specialist Sabra Leads
Sabra Also the Growth Leader Among Top 10
Spotlight on Segment Leader Sabra
Joint Agreement with PepsiCo
Table 5-6: Leading Refrigerated Flavored Spreads Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Refrigerated Potato Side Dishes
Segment Sales Stagnate
Spotlight on Segment Leader Northern Star
Table 5-7: Leading Refrigerated Potato Side Dish Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Refrigerated Pizza/Pizza Kits
Sizzling 18% Growth in 2009
Plaza Belmont Controls a Third of Sales
Vicolo Scores 90% Retail Sales Gain
Spotlight on Segment Leader Plaza Belmont
Table 5-8: Leading Pizza/Pizza Kit Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Refrigerated Hand-held Non-Breakfast Entrees
Sales Slip 2%
Top 10 Marketers Had Tough Sledding In 2009, But Lower Tier Marketers Excel
Spotlight on Segment Leader Stefano Foods
Table 5-9: Leading Hand-held Non-Breakfast Entrees Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Refrigerated Fresh Soup
No Growth Despite Dazzling Performance by Legal Sea Foods
Spotlight on Third-Place Legal Sea Foods
Table 5-10: Leading Fresh Soup Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Other Fresh Convenience Food Segments
Refrigerated Side Dish Growth Stagnant, Competition Hectic
Spotlight on Refrigerated Side Dish Segment Leader Bob Evans Farms
Reser’s Leads Refrigerated Meat Spread/Salad Segment
Bob Evans Leads Moderately Gaining Refrigerated Breakfast Entrees Segment
Great Lakes Kraut Bests Kraft, ConAgra and Birdseye in Sauerkraut Segment
All Top Marketers See Sales Decline in 2009
Spotlight on Sauerkraut Segment Leader Great Lakes Kraut
Refrigerated Chili Segment Cools Despite Some Strong Showings
$3 Million Potato Segment Dominated by Bob Evans
Stuffed Potatoes and Sweet Potatoes
Table 5-11: Leading Refrigerated Side Dish Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Table 5-12: Leading Refrigerated Meat Spread/Salad Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Table 5-13: Leading Refrigerated Breakfast Entrees Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Table 5-14: Leading Refrigerated Sauerkraut Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Table 5-15: Leading Refrigerated Chili Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Table 5-16: Refrigerated Potato Marketers and Brands: by SymphonyIRI-Tracked Sales and Share, 2009 vs. 2008 (in millions of dollars)
Natural Supermarket Channel Top Picks
Introduction
Refrigerated Entrees & Sushi & Grab N Go Meals
Table 5-17: Top 5 Marketers/Brands in the Natural Supermarket Channel: Refrigerated Entrees & Sushi & Grab N Go Meals, 52 Weeks Ending February 10 vs. Year-Ago (in dollars)
Salsas & Dips
Table 5-18: Top 5 Marketers/Brands in the Natural Supermarket Channel: Salsas & Dips, 52 Weeks Ending February 10 vs. Year-Ago (in dollars)
Chapter 6: Consumer Trends
Introduction
Methodology
Though Time-Pressed, Most Americans Are Trying to Eat Healthier
Figure 6-1: Consumer Attitudes About Healthy Foods and Time Constraints, 2009/10 (percent of U.S. adults)
Recessionary Decline in Restaurant Traffic a Plus for Fresh Convenience Foods
Table 6-1: Level of Agreement with Statement, “I Am Spending Less on Groceries These Days Because of the Economy,” May/June 2010 (percent of U.S. adults)
Figure 6-2: Impact of Recession on Consumer Cooking and Restaurant Habits, May/June 2010 percent of U.S. adults)
NGA Survey Supports Shift from Restaurants to Retail/At- Home Meal Prep
Packaged Facts Survey Indicates Trend Will Continue
Table 6-2: “In Comparison to Right Now, How Much Money Do You Plan to Spend on Meals Eaten at Full-Service Restaurants During the Following 3 Months?”, May/June 2010 (percent of adults)
Table 6-3: “In Comparison to Right Now, How Much Money Do You Plan to Spend on Meals Eaten at Fast-Food Restaurants During the Following 3 Months?”, May/June 2010 (percent of adults)
Table 6-4: “In Comparison to Right Now, How Much Money Do You Plan to Spend on Takeout/Delivery/Drive-Thru Meals Eaten at Full-Service Restaurants During the Following 3 Months?”, May/June 2010 (percent of adults)
18% of U.S. Consumers Are Buying More Fresh Prepared Foods
Table 6-5: “Have You Eaten More Store-Bought Fresh Prepared Foods Since the Recession Began?”, May/June 2010 (percent of adults)
Room for Growth
Table 6-6: Percent of Adults Who Have Purchased or Eaten Any Store-Bought Fresh Prepared Foods in the Last 3 Months, May/June 2010
Reasons for Buying Ready-to-Eat and/or Heat-and-Eat Food from Grocery Stores or Convenience Stores
Table 6-7: Reasons for Getting Ready-to-Eat and/or Heat-and-Eat Food from a Grocery Store/Supermarket, 2009 (percent)
Table 6-8: Reasons for Getting Ready-to-Eat and/or Heat-and-Eat Food from a Convenience Store/Gas Station, 2009 (percent)
Walmart Tops List of Outlets for Fresh Convenience Foods
Table 6-9: Percent of Adults Who Have Purchased Fresh Convenience Food from Outlets Other Than Conventional Supermarkets in the Last 3 Months: By Type of Outlet, May/June 2010
45% of Consumers Have Dinner Composed Solely of Fresh Convenience Food
55% of Consumers Have Dinner Partially Composed of Fresh Convenience Food
Table 6-10: Percent of Adults Who Have Eaten a Meal Composed Solely of Store-Bought Fresh Prepared Food Items in the Last 3 Months: By Daypart, May/June 2010
Table 6-11: Percent of Consumers Who Have Eaten a Meal Composed Partially of Store-Bought Fresh Prepared Food Items in the Last 3 Months: By Daypart, May/June 2010
The Experian Simmons Survey System
Relatively Flat indexes Among Frequent Consumers of Store- Made, Pre-Cooked Meals
Prime Targets: Young Singles Living on Their Own
Table 6-12: Above-Average Demographics for Agreement with Statement: “I Often Eat Store-Made, Pre-Cooked Meals” (index of U.S. adults)
Large Households Make for Less Frequent Consumers
Table 6-13: Below-Average Demographics for Agreement with Statement: “I Often Eat Store-Made, Pre-Cooked Meals” (index of U.S. adults)
Customers Who Disagree That They Frequently Eat Fresh Prepared Meals
Table 6-14: Above- and Below-Average Demographics for Disagreement with Statement: “I Often Eat Store-Made, Pre-Cooked Meals” (index of U.S. adults)
Summing Up: Good News for Fresh Convenience Food Marketers
Store-by-Store Analysis: Thumbs Up for Meijer, Down for Sam’s Club
Table 6-15: Above Average Consumer Demographics for Agreement with Statement “I Often Eat Store-Made, Pre-Cooked Meals” by Outlet (index of U.S. adults)
Table 6-16: Below Average Consumer Demographics for Agreement with Statement “I Often Eat Store-Made, Pre-Cooked Meals” by Outlet (index of U.S. adults)
Table 6-17: Above Average Consumer Demographics for Disagreement with Statement “I Often Eat Store-Made, Pre-Cooked Meals” by Outlet (index of U.S. adults)
Table 6-18: Below Average Consumer Demographics for Disagreement with Statement “I Often Eat Store-Made, Pre-Cooked Meals” by Outlet (index of U.S. adults)
Wegmans Survey Shows that 22% of Americans Eat Fresh Prepared Foods Weekly
Customers Want Their Meals to Be Easy, Healthy and Affordable
Appendix: Addresses of Selected Marketers and Retailers

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