Habits Developed During Pandemic Bolster Frozen Category For The Long-Term

Namnews, 18th February 2022

Retail frozen food sales have grown by 13.5% compared to pre-pandemic levels, with recent data suggesting the sector will benefit from longer-term changes in shopper habits.

A new market report from British Frozen Food Federation (BFFF) reveals that despite restaurants, cafes and pubs opening back up in April 2021 following over 12 months of restrictions, frozen sales have maintained their momentum.

However, the return to eating out has led to less frequent shops and smaller shopping baskets which has resulted in year-on-year value growth of the frozen food market slowing to 1.2%.

BFFF chief executive, Richard Harrow, commented: “After two years of disruption, the retail market is returning to pre-pandemic normal, but frozen has attracted over 400,000 more shoppers in the last two years. The retail frozen food market is now worth £7.1bn and has added nearly £850m worth of sales since 2019 that’s value growth of +13.5% and volume growth of +9.2%. With the total grocery market broadly flat, frozen sales have significantly outperformed the market.”

He added: “Last year was another turbulent year for everyone in FMCG. With foodservice outlets opening back up in April, it would have been overly optimistic to assume the same success that we saw in 2020. However, when you look at the market compared to 2019, we have seen incredible growth. While consumers may have looked to frozen out of necessity in 2020, they have come back through choice in 2021.”

Kantar figures quoted in the report show ice cream is the largest single category in frozen, worth £1.3bn to retailers and accounting for 18.6% of their overall frozen food sales, up from 17.3% in 2019. Frozen fish broke through the £1bn barrier in 2020 and 2021’s sales represent a 16.4% (£141.2m) gain in just two years.

Meanwhile, lifestyle changes are driving meat-free innovation. Vegan and vegetarian products have achieved 16.8% growth since 2019, contributing to a £237.4m (19.8%) growth in sales of savoury foods in the same period.

Harrow said: “There has been incredible innovation in the frozen plant-based category. From developments in the texture and mouthfeel of meat alternatives to new recipes that make vegetables the star of the show, it’s no surprise that consumers with all kinds of dietary needs and preferences are adding these types of products to their baskets. The plant-based category is growing at four times the rate of meat analogue products and we expect this trend to continue.

“Another factor that will drive frozen sales is food waste. The majority of shoppers (62%) are now influenced in their food and drink purchases by sustainability issues and frozen food, with its proven ability to cut food waste, is perfectly positioned to help.”

In terms of pricing, the frozen category has returned to a form of normality with promotional participation trending back to levels of 2019 in most categories.

Harrow commented: “Continued price matching with Aldi is impacting some categories. This is good news for consumers as frozen vegetable prices are down 3.7% in the past year and down 6% since 2019. However, it does put producers under even more pressure at a time of increasing inflation.”