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The frozen and refrigerated breakfast market.

European visitors have been known to wince or stare in astonishment at the sheer size of a good old fashioned American breakfast. But if European food marketers are wide-eyed, it's simply pure envy at the sales of the category that has restored hearty eating to America's morning meals. Retail sales of frozen and refrigerated breakfasts -- including Waffles, Specialty Breakfasts, and French Toast/Pancakes -- grew 7.5% in 1992, to hit the $1 billion level. This amounts to a zesty 63.1% increase since 1988, when the market had sales of approximately $660 million.

Surprisingly, those huge gains have come despite a steady decline in the rate of annual growth. It has fallen from 24.6% in 1988, to 7.5% in 1992. And Packaged Facts is projecting another decline in '93, albeit a slight one, with growth pegged to slip to 7.0%. After that, annual gains will stabilize at a rate of 6% through 1997, when sales will reach almost $1.5 billion.

Over that period, the three different categories in the market will maintain annual growth of between 5% and 7%. And that will have the following effect on sales -- the Frozen And Refrigerated Waffles category will grow from $535 million in 1992, to $715 million in 1997; the Specialty Breakfast Foods category's sales will increase from $417 million in 1992, to $585 million in 1997; and the French Toast/Pancakes category will rise from sales of $127 million in 1992, to $166 million in 1997.

Ironically, it's a modern invention, the microwave, that has restored the hearty breakfast to the American table. It's estimated that approximately 90% of all homes, and 75% of all offices, contain those fast-working foodwarmers. And it's safe to say that without the proliferation of microwaves the Frozen And Refrigerated Breakfast Market would simply not exist. But another modern contrivance, the two worker-family, is certainly responsible for its continued growth.

David A. Weiss, president of Packaged Facts, explains the impact of two-worker families on The Frozen And Refrigerated Breakfast market this way, "With two spouses working frantically, it's a wonder if anyone has time to prepare a hot meal from scratch for dinner, much less breakfast. But with microwave ovens, even the kids are cooking away."

This fact has not gone unnoticed by marketers such as Campbell and ConAgra who have targeted youngsters with their Breakfast Blast and Banquet Kids Cuisine lines, respectively. Kids are also given part of the credit for the increasing popularity of breakfast sandwiches, accounting for 29% of the Specialty Breakfast Food category's sales.

These meals have become extremely TABULAR DATA OMITTED popular items at home, much to the detriment of the fastfood restauranteurs that had so successfully used Egg McMuffin's, and the like, to expand their sales base into breakfast. Mr. Weiss feels that the fast food chains have little chance of recouping their losses. Says he, "During the week, breakfast is a meal of convenience, not relaxation. For many consumers it was more convenient to pop into a Mcdonald's or Burger King on the way to work than it was to make something at home. But now, with frozen breakfasts, that's no longer the case."

Convenience isn't the only weapon in The Frozen And Refrigerated Breakfast market's arsenal, however. When microwaving at home, consumers have access to a greater variety of products than they do in restaurants. This allows for greater choice and, perhaps more importantly, a greater degree of dietary control. And that has great appeal for those wishing to lower levels of fat and cholesterol, always a bete noire of breakfast products.

Since up to one-third of cholesterol intake comes from eggs, it is probably no surprise that egg substitutes are the most popular of the healthy oriented products, accounting for over 18% of the Specialty Breakfast category's sales. But health pitches with whole grained and reduced calorie items, etc., are also being made in order to appeal to both seniors and aging baby boomers. Other efforts to appeal to the mature set have included meals based on Mexican, Middle Eastern, Italian, and French foods. But Mr. Weiss is somewhat skeptical about the potential success of some of these more exotic items.

"It's a good thing to create a little variety," he believes, "but there's a limit to the gourmet angle. Consumers have enjoyed the hot microwaveable meals in great part because memories are evoked of when people had time to sit around and eat the proverbial family breakfast. But gourmet treats -- they're more likely to trigger memories of airline tray tables.

Nonetheless, the zealousness of marketers to explore different avenues has allowed the market to upscale, and that upscaling has been one of the driving forces in increasing retail sales. In fact, over the past five years, retail dollar sales gains have been roughly two and a half times pound growth.

The marketers who have divided those spoils are some of the best known in the food industry.

In the Specialty Breakfast category, Campbells (Swanson) leads with approximately one-quarter of sales. Second is RJR Nabisco, based on the strength of its Egg Beaters brand of egg substitutes. Sara Lee is third, with strong showings in breakfast sandwiches and baked goods.

In both the Waffles category and the French Toast/Pancakes category, Kelloggs holds sway with its powerful Eggo brand, accounting for over 50% of combined sales. Pet (Downyflake) and Quaker Oats (Aunt Jemima) run second and third, respectively.

A plethora of other producers are involved in the market, ranging from tiny startup companies to major marketers such as Heinz and ConAgra. But, according to Mr. Weiss, the days of the little guys are numbered, at least at the supermarket level. "The fight for shelf space has become really intense," he concludes, "and without marketing muscle, it's going to be very hard to find room in the freezer."
COPYRIGHT 1993 Frozen Food Digest, Inc.
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Copyright 1993 Gale, Cengage Learning. All rights reserved.

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Publication:Frozen Food Digest
Date:Oct 1, 1993
Previous Article:Frozen sweet corn and mixed vegetables.
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