Are ready meals being frozen out? | Cover feature – chilled and frozen food

As if declining sales wasn’t bad enough, ready meals have had to contend with the horse meat scandal. With such uncertain market conditions, how does this market begin fighting back? Simon Creasey finds out more

Saucy Fish range

Who would want to be a ready meal manufacturer at the moment? After years of successive growth, figures released by Kantar Worldpanel show that over the 12-month period to August 2012, consumption occasions of chilled ready meals slumped by 4.2%, with frozen ready meal occasions down a whopping 21.1%.

The decline was caused by an 11.4% drop in ready meal consumption occasions as consumers – particularly children and young males – turned their back on ready meals and sought out alternative options instead.

If that weren’t bad enough the ‘Horsegate’ scandal that erupted earlier this year has seen shoppers lose faith in ready meal manufacturers and retailers, with the reverberations set to ripple throughout the industry for some time to come.

But this is not just a case of rebuilding consumer confidence in a scandal-hit category. As the sales figures for the period building up to the horse meat revelations show, ready meal sales were already declining before the news broke.

So why has the nation fallen out of love with ready meals and what role can packaging play in winning back consumers who have switched their purchasing allegiances elsewhere?
The reason ready meal sales have fallen off a cliff recently isn’t just down to one or two different factors, argues Stergios Bititsios, associate director packaging and design at MMR Research Worldwide. It’s due to a combination of conflicting issues.

“Convenience, good value for money, functional superiority and emotional reassurance is what consumers expect products and packaging to deliver,” says Bititsios. “These demands have been found to intensify during a financial downturn, a trend which could offer a possible explanation as to why the ready meals sector is currently seeing drops in sales. In many respects it fails to deliver well against consumers’ needs.”

Changing lifestyle trends are also likely to have played a significant part in the category’s decline, adds Bititsios. “From working closely with many of the world’s leading food manufacturers and grocery retailers we have been able to see a shift in attitude towards cooking, as consumers have come to favour the idea of preparing their own meals using more natural ingredients. This shift is driven mostly by the modern desire to lead a healthier lifestyle; a quality that in consumers’ minds is heavily compromised in the ready meals category.”

Although these consumer trends have clearly had an impact on the fortunes of ready meals it would be erroneous to say the category’s decline is solely due to changing consumer lifestyles. Another guilty party is poorly thought out packaging, according to Elmwood director of effectiveness ‘stuff’ Simon Preece, who says the category is guilty of accepting mediocrity when it comes to its packaging demands.
“It’s almost as if the industry has decided to settle for second best and is happy to continue to churn out what it can in the format it’s always used,” says Preece.

This problem is further magnified in the frozen aisle, which is one of the most neglected parts of the store when it comes to packaging, adds Preece. “People don’t like to browse frozen,” he explains. “It’s usually the last area in the store so your trolley is already full, the kids are swinging off the back of the trolley screaming and shouting and you just want to get out of there. For most people the frozen aisle is just bang, bang, bang – you get in and you get out.”

The way consumers shop the frozen aisle has, in turn, had a negative impact on the way that manufacturers of frozen goods package their products, according to Cathy Barnes, professor of retail innovation at Leeds Metropolitan University and a director of the Faraday Centre for Retail Excellence.

“I know from talking to ice cream manufacturers that until very recently there was a philosophy in the frozen food sector that said there’s no point doing anything with the packaging because the customers don’t feel it because it’s too cold and they don’t look at it because it’s in the freezer, so what’s the point of innovating?”

As a result of years of neglect, the ready meals category is crying out for innovation. That’s not to say that all brands are guilty of falling into this trap. There are a handful that have taken an innovative approach to packaging and in doing so proved that offering something slightly different can make a big difference to the bottom line.

Preece cites the example of The Saucy Fish Co as a classic example of a brand that decided to embrace a different packaging structure and graphics to existing products to create shelf standout in the chilled fish aisle.

Arresting a decline

The product, which consists of a piece of fresh fish and a sauce, was developed by Seachill – one of the UK’s largest providers of supermarket own label fish – after it was approached by Tesco to help arrest a decline in its share of chilled fish sales.

“At the time the category was all about anaemic looking white fish on white trays stacked on their side in white supermarket shelves with white writing. It all looked very white, very uninspiring and not very appetising,” recalls Preece. “If they just thought about it within the constraints of what they already had they would have failed. But they thought differently and created a brand and a proposition that really resonated with consumers.”

Elmwood helped Seachill to devise the graphically bold Saucy Fish logo and eye-catching packaging, which in the space of just over two years has become a £40m plus brand. The Saucy Fish Co is not the only firm to break away from category norms to create packaging with a real point of difference.

Premium ready meal supplier Charlie Bigham’s has always stood out from the crowd with its eye-catching wooden packaging and white card sleeve, which serves the dual function of protecting the food inside, but also conveys the company’s brand messaging to look great on shelf. While the rest of the ready meal market may be in decline, Bigham’s has enjoyed year-on-year sales growth of 80%, by striking the right balance between quality and convenience – values that are reflected in its packaging.

“In ready meals consumers look for convenience so any packaging needs to be really easy to use at home,” says Bigham’s founder Charlie Bigham. “However, when shopping for our ready meals we know that consumers like to know what they are buying – at the very least they like to look at our dishes inside the packaging and at a photograph of what they are going to look like when they are cooked up. We believe that in premium ready meals – like in many premium categories – your packaging has to inspire your shopper. However, if the packaging is inconvenient once they’ve got it home they are less likely to purchase. Packaging therefore has to inspire and be convenient if it’s going to do a good job for you.”

This is the balance that food manufacturer Hain Daniels was also looking to strike when it decided to launch a chilled range of Linda McCartney vegetarian ready meals last year.

“For Linda McCartney Food the quality, taste and look of the product is as important as the brand itself so for us graphics of the product are important,” says Rob Dixon, marketing controller at Hain Daniels. “The use and functionality of the packaging is key to the product and the enjoyment a consumer experiences when using a product, so yes the convenience of a pack is important and the functionality often dictates design. However, in most instances it is possible to marry both to come up with a really effective packaging option.”

How to stand out

Of course not every brand is going to have the financial clout of a group the size of Hain Daniels to invest in innovative packaging structures and design, but there are a number of things that brands can do relatively cheaply to create shelf stand out.

One approach is to use a different structure to that used by competitor brands, says Gerard Connolly, sales and marketing manager at packaging manufacturer IPS.

“In a competitive retail environment packaging can play a vital role in generating sales by attracting the attention of the consumer, communicating key messages and closing the sale,” explains Connolly. “The structure can provide an effective way for a brand to stand out on shelf. For example, if the norm is an oval shaped carton then something different, such as a rectangular shaped carton, will stand it apart.”

But changing the structure alone isn’t going to ensure a product is successful, he adds. “For great on-shelf appeal other factors need to be considered including the colour, graphic design and brand messages.”

And even if you decide to employ this multi-pronged approach it’s no guarantee of success as other factors are increasingly coming into play when consumers make their purchasing decisions, says Joanna Stephenson, vice president of marketing and innovation at Linpac Packaging.

“Graphics and branding will always be important to food packaging as it is this which tends to ‘draw’ shoppers in. However, consumers are increasingly taking other factors into consideration, for example ease of use and environmental issues,” explains Stephenson. “While branding and graphics may be the initial attraction for shoppers they are spending longer choosing their purchases and packaging manufacturers are recognising the need to offer something more to savvy shoppers to entice them to buy.”

To this end companies like Linpac are working on a number of different innovations that reflect changing consumer patterns, such as multi-portion or split pack and resealable products, which enable consumers to use the exact amount of food they need at any one time and are proving to be good value at the supermarket. “Furthermore they also help to reduce food waste – a crucial issue for retailers and consumers alike,” adds Stephenson.

It’s clear that further work is needed to help packaging suppliers, ready meal manufacturers and retailers better understand what consumers want from this sector and to better understand their purchasing motivations. This is particularly the case in the frozen aisle where brands seem to have lost their way, argues Elmwood’s Preece.

“At the moment all people are doing is looking at function,” he says. “They’re not looking for fresh consumer insight. What they should be asking is ‘how can I make my product more suitable and tell a story to a consumer that makes them want my product?’ You’ve got to figure out where and how frozen fits into a consumer’s life now.”

The answer to this conundrum, according to Preece, entails taking a holistic approach.

“You can’t just change the structure and the graphics and hope it works. You’re going to have to have some very focused and well thought through marketing to make it a success. People have got to start to think about changing the graphic language around these categories before it’s too late.”

Vox Pop

In the past packaging in the frozen food category has been regarded as purely functional. Is there room for innovation in the frozen food sector?

Shaun Jones

Realisation director, Pearlfisher

“Yes, but we need to start innovating for our digital as well as physical channels – to create brand and packaging design with impact on–shelf and online at 20 pixels. The frozen aisle can be perceived as rigid and sedentary and this is often reinforced online with static, cut and paste pack shots. But, there is licence to better represent the brand online – to create an even richer experience by dialling up food and brand cues or by fostering interaction and discovery. The opportunity is to create desirable, inspirational brand design for an integrated world.”

Simon Preece

Director of effectiveness ‘stuff’, Elmwood

“There’s room for innovation in every sector. If you don’t think that, then you might as well join the likes of HMV, Comet and Jessops. You need fresh consumer insight. It’s no longer just about flogging what you can make. How does frozen really fit into consumers’ lives? To cut through, you must tell a strong engaging brand and product story. Don’t limit your thoughts to frozen foods, learn from other sectors. Think like The Saucy Fish Co. High-value chilled protein products need to work hard to get into the shopping basket. Yet take the fear and fuss out of cooking fish and present the brand with a distinctive attitude in a contemporary way and you get a brand that has grown to become a £40m plus brand in just over two years.”

Stergios Bititsios

Associate director packaging and design, MMR Research Worldwide

“The frozen food category is getting a lot more crowded and cluttered. With own label brands rapidly expanding their range, competition becomes more fierce and standing out in the crowd becomes more of a challenge. Packaging is the most tangible vehicle for differentiation and innovation can’t be seen as a luxury any longer but as a must-have if brands wish to survive. Big players such as Birds Eye and McCain have made a good start as in the last few years they have gone beyond excellent graphics execution to achieve even greater appeal via their substrates’ visual and tactile texture.”

Jack van der Heiden

Sales and marketing manager, Flexoplast

“Absolutely. The big household brands tend to use better quality print and materials compared to the private labels, but creating distinctive packaging for frozen food is a challenge because of the display and space constraints in freezer departments. That’s why innovation is so important for this sector. The real success stories are the companies that invest in new machinery and innovate with packaging. At Flexoplast we’re seeing an increase in demand for more innovative packaging in the sector. Clients are using ‘paper-look-and-feel’ bags and stand up pouches and we’re seeing a rise in re-sealable bags to add value for the consumer and help differentiate products.”



One comment

  1. In response to your comments regarding the location of frozen goods in-store, I am no retail and store expert but I would have thought that the location of the freezer cabinets / chests are towards the end of the shopping experience to give the product minimum thaw time. On that basis, is there a statistic that explains the average time it takes for a full shop? If freezer cabinets are located at the start of the isles, it would mean a more rapid thaw of frozen product prior to leaving the store. Having cabinets located at the end, keeps product frozen longer for the post shop journey home.

    Regarding innovative and functional packaging, unfortunately we have heard many times that packaging suppliers seldom show new and innovative ideas. I think it is fair to say, these days are long gone but unfortunately, just the same as there is a price differential between a luxury car and a off-the-line family car, the same with packaging, if you want something that is quite different it costs more.