Health Issues in Frozen Foods

From 1999-2004, increasing concerns with obesity and nutrition have changed the dynamics of the frozen meals market. Low-carb diets, including Atkins, South Beach, as well as other high-protein diets, have cut demand for frozen meals containing potatoes, pasta, or other starches. Consumers are demanding more information, and becoming more selective, about their meal choices. As consumers prepare fewer meals at home, and the profitability of servicing these consumers is rising, increased competition for their dollars is being seen from in-store delis, restaurants, and take-out.

Low-carb craze cooling

Frozen meal manufacturers have introduced new products addressing the demand for low-carb products. For example, in May 2004, Unilever Bestfoods expanded its Carb Options line, offering products across multiple categories such as sauces, soups and side dishes. ConAgra introduced Life Choice low-carb frozen meals in February 2004, which feature fewer carbohydrates than its popular Healthy Choice line. The line includes three breakfast meal options, and 11 entrées for lunch or dinner, each with an average of 15g of carbohydrates and 35g of protein.

However, although there is definite demand for low-carb products, Mintel sees recent evidence that the low-carb craze is cooling. The market for low-carb products is expected to decline gradually over the coming year. About 12% of U.S. adults were on a low-carb diet in the first quarter of 2004, while this number dropped to 10% in the second quarter. Today there are more former Atkins dieters than current ones.

Mintel estimates that over the next two to three years, it is likely that low-carb products will continue to be offered; however, they may become one part of the general weight loss market. The positive residual from the popularity of this diet is expected to be similar to the low-fat diet in the 1990s. The U.S. witnessed an overall increase in awareness about fat, which resulted in behavior modification to consume lower-fat products, in general. In a parallel fashion, Mintel expects that awareness of low-carb diets will cause Americans to increase their consumption of whole grains and nutrient-rich vegetables.

Healthy eating and dieting

As concerns with obesity are brought to the forefront, and publicized by popular diets, TV talk shows, and numerous published articles, the demand for healthier new products continues to grow. Americans are looking for eating alternatives that will make them healthier, skinnier, and happier.

There is significant reason for concern. In the U.S., 127 million adults are defined as overweight, 60 million are obese, and 9 million are severely obese. In the years since the 2000 awareness effort, Americans have indeed become increasingly aware and concerned about these alarming statistics and are taking steps to increase the healthfulness of their meals. The major focus is being put on making lifestyle changes like increasing physical activity, eating less but more nutritious diets, and better stress management. But making lifestyle changes is a slow and difficult process.

Frozen meals have a distance to go before they are generally perceived as healthy. Manufacturers have been successfully introducing healthier frozen meals; the success of Lean Cuisine and Healthy Choice shows that introducing healthful meals may motivate new users to try out the category, and also allow current frozen meal consumers to switch to more healthful selections.

In order to meet the needs of health-concerned Americans, frozen meals will need to address, and promote, dietary and weight loss concerns. Growth opportunities exist for targeting specific health conditions like heart disease and diabetes in addition to weight loss. Frozen meal manufacturers will have to be diligent in segmenting the marketplace in multiple sub-segments, and consequently fine-tuning the brands and products in each segment. Outside the weight loss segments, greater opportunity will exist for products offering better taste and general wellness benefits.

For more information on the frozen meals market or other frozen foods markets, consult Mintel, an independent market research firm based in Chicago. Mintel publishes market research reports on dozens of food categories. Further information is available on Mintel's new report on the frozen meals market and NFRA members are entitled to a 10% discount on this report. Contact Caroline Sack at 312.943.5250 or email info@mintel.com for further details. Please quote NFRA as reference.

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