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What Americans want in the frozen breakfast category is the same thing they want in every other category — everything.
The question is, can manufacturers and retailers continue giving it to them?
It is not much of a secret that consumers shopping the frozen aisles make their buying decisions based on a complex combination of factors like convenience, variety, quality, health, value, premium choices, portability, speed of preparation, meal solutions and smaller portions.
But while breakfast is a key daypart—as restaurants and hotels are rediscovering—innovation is frankly a bit more difficult in a daypart so strongly linked with a limited menu mix consisting of pancakes, eggs, bacon, waffles and juice. Product innovation that can generate trial and drive incremental business is an enduring challenge.
The frozen breakfast food category is growing. For 2007, sales of more than $1.3 billion represented nearly 3.3% growth. The pancake segment posted 5.1% dollar sales growth. Private Label has been a driving force for growth in the "syrup-carriers" segment.
Chicago-based consultancy Technomic Inc. came up with some good insights into the breakfast consumer with its nearly 400-page Breakfast Category Report released in June. Among its findings: Consumers see weekday and weekend breakfast occasions as very different. During the week, convenience and portability are what count. But on weekends, Americans look first for quality and variety. Roughly 44% of respondents indicated they would consume breakfast items throughout the day.
This element — time — may prove an interesting consideration as executives conceive marketing plans involving breakfast products.
"A lot is happening," says Tim Smith, senior brand manager for Jimmy Dean, a brand of Sara Lee Food & Beverage, Downers Grove, Ill. "It is a big, growing category for the retailers. There is a portion of it that's driving the majority of the growth—protein-based products."
"Certainly breakfast has always been something that we have focused on because we have such heritage, from restaurants as well as grocery products," says Nancy Cowen, director of marketing, Bob Evans Farms Inc., Columbus, Ohio. "It's certainly an area we see as a growing consumer trend."
Here's a look at how consumer interest is manifesting itself on frozen food shelves:
Health: According to a report last year by the International Food Information Council (IFIC), most Americans decide to change their diet because they want to lose weight. In fact, 70% of Americans surveyed said they had altered their diets in order to lose weight. Seventy-five percent of respondents said they were concerned about their weight, and 56% said they were actively "trying to lose weight." More than half the respondents — 58% — admitted to having reduced their portion sizes. And according to a study by the US Department of Agriculture, fewer than 10% of Americans get their recommended daily servings of whole grains each day.
Breakfast marketers got still more good news from the UK in January, where the Institute of Metabolic Science, Addenbrooke's Hospital announced that shifting a greater proportion of a day's total calorie intake to breakfast time "is potentially beneficial for lower weight gain among middle-aged men and women." A study of 6,764 men and women ages 40 to 75 found that those who ate a greater proportion of their calories at breakfast gained less weight.
"Certainly trans fats have played a key role," Cowen reports. Shoppers are looking at the nutritional components, as well as portion size. "'Super-size me' is gone. They're looking at smaller portions."
Beyond that, nutritionally enhanced products are "certainly an area of growth," she adds. There are "a lot of people out there now with products like the Vitamin Water that Coca-Cola has recently brought up (after purchasing maker Energy Brands Inc., known as Glaceau, in May 2007)."
"We've seen the trend toward healthier eating reflected in Kellogg's Eggo sales," says Jim Poppens, vice president marketing, frozen foods, Kellogg Co., Battle Creek, Mich. "The segment showing the most growth is our Eggo Nutri-Grain platform because consumers are looking to incorporate the USDA Food Pyramid, emphasizing whole grains and fiber in their diets."
Additionally, the company's Morningstar Farms breakfast line is showing strong double-digit growth driven by its core breakfast offerings and items such as Morningstar Farms Veggie Sausage Patties and Country Scramble Veggie Bites.
"As consumers are living lives that continue to be busy, they are searching for convenient, healthy and tasty food options," Poppens says. The company has responded: Eggo waffles, for example, have zero grams trans fat per serving. Each of the items in the Eggo portfolio, including mini pancakes and mini waffles, serves as a source of eight vitamins and minerals. Each waffle contains about 100 calories. Morningstar Farms' Veggie Sausage patties and links provide consumers with a meatless breakfast option that is lower in fat than traditional meat counterparts.
According to Poppens, consumers are increasingly looking at nutrition when making their purchase decisions. "For example, in 2006, 40% of shoppers choose foods because they do not contain undesirable nutritional qualities" such as sugar, fat, carbohydrates, salt or additives. "This is one of the factors driving consumers to items like Morningstar Farms Veggie Sausage patties, which contain 75% less fat than pork sausage patties, and Eggo waffles, which contain zero grams trans fat per serving."
At the same time, Poppens continues, 44% of consumers choose foods and beverages "because they contain desirable nutritional qualities, such as fiber, protein and whole grains."
Jimmy Dean plans to leverage consumers' desire for more healthful food with introductions like its new reduced-fast/calorie sandwiches, marketed under a sub-brand called D-lights. Says Smith, "We will continue to push that platform into the future."
Americans "are always going to be looking at multiple elements," Cowen concludes. "There seems to be an increasing trend toward naturals and organics, although the organics are a different animal. But people want more consumer-friendly, and also environmentally-friendly products." In October, Bob Evans introduced a line of Oatmeal Bowls with four varieties: Hearty Blueberry, Apple Cinnamon, Cranberry Pecan, and Cinnamon Raisin. The 9-oz. packages retail for $2.99 to $3.49.
Convenience: "Convenience is king, and people are willing to pay more for it," Cowen says. "But it has to have great taste. People are so busy that they really need a good solution for all meals, and breakfast is such an important deal—'the most important meal of the day.'"
It's been two and a half years since Jimmy Dean introduced its breakfast skillets line, which Smith says has proven "very incremental to the category." That line, which targets families, gives consumers sausage, vegetables and potatoes, to which they add eggs and cook in a skillet.
In addition to skillets, Jimmy Dean launched a
line of 8-oz. Breakfast Bowls that includes egg about a year and a half ago. "It's basically a scramble that contains the sausage, potatoes, eggs and cheese." It is ready after three minutes in a microwave oven.
"Consumers typically are willing to pay more for convenience because we've really done the work for them," says Cowen. "It has to be a real simple solution. Whether its dashboard dining or take to work/take to school and prepare there, they are willing to pay a little bit more for that."
Family Dining: "I think the biggest thing is that consumers always say that breakfast is the most important meal of the day," Smith points out. They also have what he calls an "amazing nostalgia for the breakfasts that they had in the past, when they all gathered around the table as a family to a big breakfast that had multiple sides, was protein-based, had bread, eggs the whole nine yards. They still want to do those with their new families but aren't really finding the time."
Once they open the cooler door, consumers are choosing products that include protein. They also want brands they already know. "Consumers are interested in purchasing a brand they trust and know and have used for years and years," says Smith. "Our equity is based on our heritage of producing fresh sausage sold through the refrigerator case. Consumers remember that from when their moms and dads were making it. It's what we've built our success on over the past couple of years, and will continue to in the future."
Smaller Portions: Jimmy Dean executives are reacting to the much-written-about trend toward smaller households with both the bowls and new platforms that it will launch in the next couple of months. "We're seeing a lot of young couples, a lot of singles," Smith says. "While families are still our bread and butter, we are seeing a lot of adults who are either living on their own or with a partner."
Value: When it comes to pricing, "a couple of things are going on," says Smith. "I think consumers continue to want an entry-level price point that is below $3 or $2, depending on what category they are in. We are seeing $3 as a nice threshold so that they can try products at a nice risk-free price." Breakfast bowls, for instance, sell at retail for $2.99 but commonly sell for $2.50 to $2.65 every day.
Value-conscious consumers have also responded to Jimmy Dean's value packs. For instance, the company markets trial-size packs of breakfast sandwiches for $2.99, as well as six-count and, at club, 12-count sizes. Smith says he expects to see a value pack for the bowls line "in the near future."
author: By Howard Riell