The stunning rise of frozen fruit: ‘Usage occasions have completely changed,’ says Dole

23-Feb-2015 - Last updated on 23-Feb-2015 at 15:48 GMT

While sales in much of the US frozen food category are pretty lackluster, sales of frozen fruit have surged in the past three years, with the category now worth more than $1bn vs just $300m a decade ago, says Dole Packaged Foods.

Paul Panza, senior director of marketing for Frozen at Dole Packaged Food, said that frozen fruit is the #1 fastest growing category within the frozen aisle in grocery and fourth within the overall food/beverage category, with dollar sales growing 13.4% in 2014 compared with just 0.7% for the frozen food category as a whole

He told FoodNavigator-USA: “Sales have been growing steadily since we entered the market in 2005 but in the past three years things have really taken off. That’s when we started to see the double-digit growth.

“Not only were people buying more, but when we started looking at the numbers in 2013 we saw that household penetration was up 3.5 points vs 2012 and new people were coming into the category, which was really undergoing a metamorphosis, and smoothies are a key part of that.

“We’re also seeing younger consumers come into the category. But the main thing that’s changed is the mentality. Usage has completely changed into everyday healthier products, like smoothies, toppings for oatmeal, salads, yogurt, and snacking instead of for desserts and baking – something that you’d buy once or twice a year in a holiday recipe.”

Retailers are dedicating significantly more space to frozen fruit now

And retailers are taking notice, he said.

“Some of the more progressive retailers have really started paying attention to this growth and they are dedicating significantly more space to frozen fruit now. I remember not so long ago it was difficult to even find the frozen fruit section in many stores.”

While private label still dominates the category in volume terms, its share has come down as Dole has built its business, and more regional brands have sprung up, said Panza. Organic fruit is also growing, but is a fairly small part of the category, he said.

“About 6-8% of sales in the category are organic and we’ve seen that increase a bit, but not a lot. I think that it’s already perceived as an extremely healthy product.”

We’re constantly thinking of ways to make this category relevant to consumers

Growth is coming from an increase in buyers, buy rates and household penetration, while a consumer survey of 1,800 category shoppers conducted by Dole last fall revealed that 16% have increased their consumption of frozen fruit compared to a year ago, with 63% citing ‘trying to eat healthier’ as a reason and 54% noting that they are ‘making more smoothies’.

dole shakers — Just add juice and shake: Dole's smoothie shakers, which contain yogurt and protein, are part of a plan to "make the category more relevant" for today's consumers, says Dole Packaged Foods

He added: “We’ve also developed new products such as dippers and smoothie shakers, and we’re constantly thinking of ways to make this category relevant to consumers.”

The berries and more exotic fruits tend to do well

Drilling down to the SKU level, volume growth (in pounds) is coming from mixed berries (+23%), mixed fruit (+22%), tropical fruit (+37%), mango (+43%),and pineapple (+44%), whereas more traditional fruits such as strawberries grew at a more modest 5% in 2014, he said.

“The berries and more exotic fruits tend to do well as mangoes and pineapples are hard to chop up and prepare. The blends are also doing really well as instead of having to purchase three or four different varieties of fresh fruit you can get them all at once with no waste and no mess, it’s just really convenient.”

While some fruits freeze better than others, advances in freezing technology also mean that the texture and appearance of frozen fruit has improved considerably in recent years, said Panza, who is introducing mandarin oranges to the portfolio this year.

“Citrus is difficult, but we’ve found ways to deliver a good eating experience from a textural and flavor standpoint, mainly by freezing at exactly the right time in the ripening process, and using fruit that has a certain BRIX level and so on, and also varying the length of the freezing process.”