Tree of life - CHFA Virtual Tradeshow Document - Frozen Section

Fu F nd

s l n a t e z n e o r am

Frozen 1

Seafood 2

Second to natural and quality ingredients, of consumers are seeking restaurant branded items. Food service plays an important role in Canadian food culture, so this desire for restaurant branding assists in instilling consumer trust and permissibility to try new items. Gone are the days of bland frozen tv dinners and pizza!

30%

0%

3

2%

26%

25%

30%

27%

24% LARGER SERVING SIZES

+3%

Natural ingredients remain a priority in the frozen food category, which is historically known as being overly processed. In terms of specific health-related considerations, consumers continue to look to sodium levels and caloric content when making purchase decisions. However, protein content and the inclusion of full vegetable servings is becoming and of just as important with consumers, respectively, voicing the importance of these attributes.

”

INTERNATIONALLYINSPIRED FLAVOURS

$1.8B

58%

“

RESTAURANTBRANDED

+7%

$6.3B +4%

64%

Which of the following would encourage you to purchase frozen/refrigerated pre-packaged meals or sides more often?

GOURMET ITEMS

99%

As with most food categories, an increased desire for quality ingredients, sophisticated and international flavours have descended into frozen foods. As such, product and brand innovation are answering these demands. of This shift has not gone un-noticed: Canadians claim they would eat more frozen entrees if it was less processed, meanwhile, feel that frozen entrees have already gotten healthier in recent years.

INNOVATION THAT WOULD ENCOURAGE CONSUMERS TO PURCHASE PRE-PACKAGE MEALS OR SIDE DISHES MORE OFTEN, MAY 2019

42%

predominantly leans towards fresh foods, the reality is that convenience is king. When considering commuting times, lengthening workdays, and ever-changing school schedules, meal prep tends to move down the priority lineup. Consumers continue to recognize the importance of sitting down to break bread and replenish; the ease of preparation frozen food provides allows the category to continue playing a major role in almost all households. In fact, the category household penetration rate holds a and is continuing to grow – meaning that additional growth is coming from increased frequency and additional occasions. Currently, and growing Frozen Foods is worth dollars, and in unit volume.

One of the larger segments, Frozen Entrees and and Dinners represent in unit volume over the prior year, with modest and growth ranging between forecasted into 2024.

NATURAL INGREDIENTS

While consumers’ aspirational preference

Natural Ingredients and Taste are #1

24%

Source: Mintel Canada, PREPARED MEALS – FROZEN AND REFRIGERATED CANADA, AUGUST 2019

4

Second to natural and quality ingredients, of consumers are seeking restaurant branded items. Food service plays an important role in Canadian food culture, so this desire for restaurant branding assists in instilling consumer trust and permissibility to try new items. Gone are the days of bland frozen tv dinners and pizza!

30%

0%

3

2%

26%

25%

30%

27%

24% LARGER SERVING SIZES

+3%

Natural ingredients remain a priority in the frozen food category, which is historically known as being overly processed. In terms of specific health-related considerations, consumers continue to look to sodium levels and caloric content when making purchase decisions. However, protein content and the inclusion of full vegetable servings is becoming and of just as important with consumers, respectively, voicing the importance of these attributes.

”

INTERNATIONALLYINSPIRED FLAVOURS

$1.8B

58%

“

RESTAURANTBRANDED

+7%

$6.3B +4%

64%

Which of the following would encourage you to purchase frozen/refrigerated pre-packaged meals or sides more often?

GOURMET ITEMS

99%

As with most food categories, an increased desire for quality ingredients, sophisticated and international flavours have descended into frozen foods. As such, product and brand innovation are answering these demands. of This shift has not gone un-noticed: Canadians claim they would eat more frozen entrees if it was less processed, meanwhile, feel that frozen entrees have already gotten healthier in recent years.

INNOVATION THAT WOULD ENCOURAGE CONSUMERS TO PURCHASE PRE-PACKAGE MEALS OR SIDE DISHES MORE OFTEN, MAY 2019

42%

predominantly leans towards fresh foods, the reality is that convenience is king. When considering commuting times, lengthening workdays, and ever-changing school schedules, meal prep tends to move down the priority lineup. Consumers continue to recognize the importance of sitting down to break bread and replenish; the ease of preparation frozen food provides allows the category to continue playing a major role in almost all households. In fact, the category household penetration rate holds a and is continuing to grow – meaning that additional growth is coming from increased frequency and additional occasions. Currently, and growing Frozen Foods is worth dollars, and in unit volume.

One of the larger segments, Frozen Entrees and and Dinners represent in unit volume over the prior year, with modest and growth ranging between forecasted into 2024.

NATURAL INGREDIENTS

While consumers’ aspirational preference

Natural Ingredients and Taste are #1

24%

Source: Mintel Canada, PREPARED MEALS – FROZEN AND REFRIGERATED CANADA, AUGUST 2019

4

Plant Based in the Frozen Aisle In early 2019, Canada’s new food guide was released, indicating a shift away from traditional food groups, and instead recommending that half of one’s diet include vegetables and fruit, a quarter whole grains and a quarter protein – with no preference to protein source, whether animal or plant based. Moving almost 18 months forward, plant-based attributes continue to be top of mind.

An extension of more natural, and less processed foods, Plant Power has touched all categories and segments, including those in the frozen aisle. Possibly two of the largest frozen segments where plant-based is playing a role, is in Dairy Free Ice Cream and Meat Alternatives. Despite the significant proliferation in these two segments, the highest rate of purchase tends to lie within Vegetarian/Vegan households. While the percentage of Vegetarian/Vegan households remains of the population, growth in these small at only segments is coming from consumers investigating new brands and the novelty that surrounds them. It is a strong assumption that consumers are purchasing both plant and meat/dairy items.

5%

SHOPPER GROUPS:

Meal Convenience Is Available in Many Ways Despite the proliferation of next-level meals and dinners in the frozen category, there are still headwinds to overcome. As mentioned previously, food service plays an important part of Canadian food culture, however new food channels are coming to the forefront in the form of meal kits, HMR and mobile ordering such as Skip The Dishes and Uber Eats. Half of quick-service restaurant users either have used or cite interest in using “mobile pre-order and pick-up” ( %) and/or third-party delivery ( %).

More choice equals more competition.

49

53

As grocery retail continues to evolve, ensure that the frozen aisle isn’t left behind.

Consumers will continue to demand health and wellness considerations, upscale flavours and a variety of innovative brands. All of this can be done, without compromising the convenience that frozen foods provide.

• Vegetarian/Vegan – 5% of the population, plant-based diet, significant proportion of current volumes • Flexitarians – 35% of the population, shifting from meat-based eating, source of volume growth • Animal-Based Protein Eaters – 60% of the population, traditional meat diet, huge future potential

To encourage consumers to continue buying into both categories, aside from taste and price, merchandising is the key to success. One of the best practices is to merchandise vegan or plant-based items within their category sets (ie. frozen dairy and non-dairy desserts together or side by side).

Within these top-level categories, keep vegan items grouped together. The use of signage or shelf talkers indicating the vegan/plant-based attribute is ideal.

Source: Mintel Canada, PREPARED MEALS – FROZEN AND REFRIGERATED CANADA, AUGUST 2019 Plant Based Foods of Canada, Retail Location Study, Sept 2019

5

Nielsen Canada, topline review, all channels, L52 weeks ending March 2020