Schwan’s Consumer Brands president: ‘The frozen category is not in terminal decline, but we’ve got to be feel-driven, not deal-driven’

One man that has already spent an unhealthy amount of time pondering such questions is Bob Waldron - the president of Schwan’s Consumer Brands (SCB), the #2 player in the US retail pizza market behind Nestlé and the owner of three of the biggest brands in the business: Freschetta, Red Baron and Tony’s.

Now Waldron is the first to admit that if you’re thinking about the most dynamic categories in food and beverage, chances are that pizza and frozen pies/desserts (Schwan’s also owns Edwards and Mrs Smith’s) are probably some way down your list after Greek yogurt, hummus and energy drinks.

Indeed, according to many trend watchers, SCB (which generates more than $1bn in revenues) is operating in categories that are dull, ‘highly processed’, off-trend, and in a state of terminal decline.  

The value equation of frozen pizza is phenomenal ​

In reality, say Waldron - who took the helm at SCB in February 2012 intent on “revitalizing its iconic brands and building the internal capability to strengthen our retail partnerships”​  - his products couldn’t be more on-trend.

For a start, frozen food is zero waste, portion-controlled, convenient and great value for money, points out Waldron, who has 20 years’ experience in marketing and general management under his belt working on brands from Yoplait to Betty Crocker.

“So no, I am absolutely not willing to settle that the category is in terminal decline”, ​adds Waldron, who recently joined forces with some of his biggest rivals on a new frozen food round table dedicated to changing consumer perceptions of frozen foods. (Click here​.)

“We have fantastic products that are convenient, great tasting and great value, but we need to market them better as an industry. The value equation of frozen pizza is phenomenal, but it’s a heavily promoted category and I do not believe that it has to be as deal-driven in future.”​

We repositioned Freschetta to target more upscale consumers but consumer research showed that our brand really speaks to the mainstream ​

While frozen pizza category volumes have been flat or declining since around 2009, the latest quarterly data reveals a return to positive territory, says Waldron, who is on a mission to move the category “from being deal-driven to feel-driven​”.

Sounds like marketing speak? Not a bit of it, says Waldron, who points out that brand-building efforts on Freschetta driven by consumer insights have helped drive “high double-digit growth rates​” for the brand, which is now back in its ‘heritage’ green packaging.

“A few years ago we re-positioned Freschetta to target more upscale consumers but consumer research showed that our brand really speaks to the mainstream, and our packaging and our advertising is now speaking to that consumer. Now it’s the fastest turning product in the category.”​

Some Red Baron products had been over-engineered ​

Research also identified cost-saving opportunities for Red Baron, with consumer feedback showing that using seven different types of pepperoni wasn’t bringing any meaningful consumer benefit and adding unnecessary cost and complexity to the product, which is “growing very well because we’ve got the basics right​”, he said.

“It’s getting the product right, the pack right, the merchandizing right. The fundamentals.​

“Some products had been over-engineered and we were able to simplify things as part of our integrated margin management work.” ​

On Tony’s, he says: “We’ve still got some work to do.”​

Retailers, meanwhile, are maintaining space allocation for pizza, he says although there is growing pressure on some of the smaller brands as the space devoted to private label (store brands) increases in many chains.

Pizza and Hispanic consumers​

As for who’s buying frozen food, and how often, consumer research also shows that many shoppers are moving to a more ‘just-in-time’ shopping model rather than stocking up, while the rise of single person households, and the growing Hispanic population present new opportunities that Schwan’s consumer and category insight experts are trying to understand, he says.

“Around 11% of pizza volumes are bought by Hispanic shoppers but they make fewer trips to buy frozen pizza, so this presents an opportunity for us to create more pizza occasions that fit with Hispanic lifestyles.”​

So what else did the research reveal?

“That consumers love our brands and they miss our brands”, ​says Waldron, who says the company “was not advertising enough” ​when he joined and is now addressing this.

People still want to indulge   ​

And what about health & wellness - not two words that immediately come to mind when you think of pizzas and desserts - where SCB occupies a #2 and #1 market position respectively?

“We are very aware of health & wellness trends but people still want to indulge and they have different priorities, so on Freschetta it’s all about transparency, clean labels, fresh ingredients, natural cheese, olive oil, sea salt and ripe tomatoes",​ says Waldron.

“On Mrs Smith’s it’s about using real butter, on Edwards we’re looking at portion control, which also ties into the shrinking household trends. Our desserts singles are growing faster than whole pies, although off a much smaller base.”​