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Center of the Store - US - January 2016

Center of the Store - US - January 2016

Mintel has defined the center of the store in terms of two segments – shelf-stable grocery and frozen foods. Sales in the category as a whole have managed fairly strong growth – 10% since 2010, largely the result of the shelf-stable grocery segment, where introductions have succeeded by catering to consumer health and wellness demands. Those demands, however, are leading consumers to seek more freshly prepared foods, and the processed reputation surrounding most center-of-the-store foods is proving a challenge to manufacturers.

Shelf-stable grocery fueling center-store sales growth

Restaurant usage rising with increasing discretionary income

Food deserts point to potential for center-store foods


OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY
The issues
Shelf-stable grocery fueling center-store sales growth
Figure 1: Total US sales and fan chart forecast of center of the store, at current prices, 2010-20
Restaurant usage rising with increasing discretionary income
Figure 2: Real disposable personal income, updated March 10, 2015
Food deserts point to potential for center-store foods
Figure 3: Grocery purchase locations, by area, November 2015
The opportunities
Organic and local claims could revive shelf-stable grocery sections
Figure 4: Opinions of center of the store, by age, November 2015
Store center organization could influence shoppers
Figure 5: Opinions of center of the store, by grocery shopping responsibility, November 2015
Hispanic Millennials more likely to embrace center-of-the-store foods at mass merchandisers
Figure 6: Opinions of center of the store, by Hispanic origin and generation, November 2015
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Sales growing in center of the store
Shelf-stable grocery leading sales growth in the center of the store
Restaurants an increasing competitor to prepared meals found at the store center
Food desert dwellers find alternatives to traditional supermarkets
MARKET SIZE AND FORECAST
Sales of center-of-the-store categories growing, largely due to shelf-stable grocery
Figure 7: MULO sales and fan chart forecast of center of the store, at current prices, 2010-20
Figure 8: Total US MULO sales and forecast of center of the store, at current prices, 2010-20
MARKET BREAKDOWN
Shelf-stable grocery growth outweighs frozen’s demise
Figure 9: MULO sales and forecast of center of store, by segment, at current prices, 2010-20
Shelf-stable grocery meeting wellness expectations
Figure 10: MULO sales and forecast of shelf-stable grocery, at current prices, 2010-20
Frozen food sales chill
Figure 11: MULO sales and forecast of frozen food, at current prices, 2010-20
Grab-and-go provides a quicker, fresher option for time-crunched consumers
Figure 12: Agreement with attitudes toward snacking, by household income, January 2015
MARKET PERSPECTIVE
Perimeter perception impacting center-store sales
Figure 13: Attitudes toward shopping at grocery specialty counters – Any agree, by presence of children in household, April 2014
Kroger’s simple approach to a natural center
Figure 14: Kroger’s Simple Truth Organic Pomegranate Blueberry Chia Granola Clusters
Figure 15: Kroger’s Simple Truth Organic White Cheddar Macaroni & Cheese
Definition of a snack evolves to include fresh foods
Figure 16: Snacks eaten in past six months – Any consumption, top five, November 2013
MARKET FACTORS
Food deserts point to potential for center-store foods
Consumers finding meals in foodservice
Figure 17: Real disposable personal income, updated March 10, 2015
Figure 18: Barriers to restaurant usage, by region, April 2015
KEY PLAYERS – WHAT YOU NEED TO KNOW
Processed products hard-pressed to resonate with health-oriented consumers
Frozen snacks decline, as major players struggle
Healthy options boost sales of snacks
Cereal options expand healthy attributes
Boon for breakfast items
GMO no-go
MANUFACTURER SALES OF CENTER OF THE STORE
Processed perception negatively impacting prepared meal/side sales
Manufacturer sales of prepared meals and sides
Figure 19: MULO sales of prepared meals/sides, by leading companies, rolling 52-weeks 2014 and 2015
Leading frozen snack brands struggle
Manufacturer sales of frozen snacks
Figure 20: MULO sales of frozen snacks, by leading companies, rolling 52-weeks 2013 and 2014
Snacks grow sales as healthier options emerge
Figure 21: MULO sales of salty snacks, by leading companies, rolling 52-weeks 2013 and 2014
Cereals add protein to boost health profile
Figure 22: MULO sales of cold cereal, by leading companies and brands, rolling 52-weeks 2014 and 2015
WHAT’S WORKING?
Breakfast options ease morning mealtime
Figure 23: MULO sales of Marie Callender's, 52-weeks ending July 12, 2015
Figure 24: Hormel Compleats Good Mornings Ham Breakfast Scramble
Figure 25: Jimmy Dean Breakfast Bowl Chorizo Breakfast
Sides take center stage
Figure 26: MULO sales of Nestle’s Stouffer’s Side Dish Collection and Pinnacle Foods Group’s Birds Eye Steamfresh, 52-weeks ending July 12, 2015
Portability compels handheld options
Figure 27: MULO sales of Smucker’s Uncrustables, 52-weeks ending Dec. 28, 2014
Snacks diversify offerings
Figure 28: Simply Cheetos White Cheddar Puffed Corn
Figure 29: Pop Secret Homestyle Butter Popcorn
WHAT’S STRUGGLING?
Frozen meals falling
Figure 30: Total US retail sales and forecast of frozen meals, by segment, at current prices, 2010-20
Weight management not managing well in frozen meals
Figure 31: MULO sales of Lean Cuisine and HJ Heinz Weight Watchers Smart Ones, 52-weeks ending July 12, 2015
Frozen snacks need focus
Figure 32: MULO sales of TGI Friday’s frozen appetizers, rolling 52-weeks 2012-14, in millions
WHAT’S NEXT?
Bringing snacks to breakfast
Figure 33: Hot Pockets Breakfast Bites Sausage, Egg & Cheese Biscuit Crust Bites
Avoiding GMOs
Figure 34: Lucky Kale with Cranberries Spring Rolls
Figure 35: Amy's Cheese Pizza Bites
Boasting biodynamic
Figure 36: Amy's Bowls Biodynamic Vegetable Penne & Marinara
Figure 37: Lundberg Biodynamic Organic Short Grain Brown Rice
THE CONSUMER – WHAT YOU NEED TO KNOW
Consumers looking beyond grocery for foods
Indulgence could propel consumers to the store center
Opportunity for center-store foods to reach Millennial Hispanics
Fathers shop the store center
Stigma surrounds the center
SHOPPING RESPONSIBILITY AND CENTER-OF-THE-STORE FOODS
Primary shoppers turning to mass retailers for center-of-the-store foods
Figure 38: Grocery purchase locations, any rank, by grocery shopping responsibility, November 2015
Potential for local brands in drug store food aisles
Figure 39: Opinions of center of the store, any agree, by drug store purchases of foods and beverages, November 2015
PURCHASE LOCATIONS
Online could be the next center versus perimeter battleground
Figure 40: Grocery purchase locations, November 2015
Consumers expanding notions of where they purchase center-of-the-store foods
Figure 41: Grocery purchase locations, by age, November 2015
Black consumers more apt to turn to dollar/discount, drug stores for center-store foods
Figure 42: Grocery purchase locations, by race, November 2015
Lower incomes looking to dollar stores for food options
Figure 43: Grocery purchase locations – Any rank 1-5, by income, November 2015
Hispanics shopping wide variety of store types for groceries
Figure 44: Grocery purchase locations, by Hispanic origin, by generation, November 2015
CENTER-OF-THE-STORE CATEGORIES PURCHASED
Frozen, cereals top the store-center categories purchased
Figure 45: Grocery department use, November 2015
Fresh options cutting into packaged/processed goods
Figure 46: Grocery department use, by age, November 2015
Frozen produce resonates with black consumers
Figure 47: Grocery department use, by race, November 2015
Hispanic non-Millennials opt for canned
Figure 48: Grocery department use, by Hispanic origin, by generation, November 2015
PERCEPTIONS IMPACTING STORE CENTER
Customization could lead consumers to the store center
Figure 49: Opinions of center of the store, November 2015
Fresh perspective on center-store
Figure 50: Opinions of center of the store, Any agree, by age, November 2015
Store center organization could influence shoppers
Figure 51: Opinions of center of the store, by grocery shopping responsibility, Any agree, November 2015
CONSUMER OPINIONS OF CENTER-OF-THE-STORE FOODS
Nutrition could key center’s rebound
Figure 52: Center-of-the-store attributes, November 2015
Processed perception proves problematic
Figure 53: Center-of-the-store attributes, by age, November 2015
Healthy center options could embrace ethnic flavors
Figure 54: Center-of-the-store attributes, by race, November 2015
Foods for fathers could cater to tradition
Figure 55: Center-of-the-store attributes, by parental status, November 2015
Center-store foods resonating more with Hispanic Millennials than non-Millennials
Figure 56: Center-of-the-store attributes, by Hispanic origin, by generation, November 2015
HEALTH DEMANDS ON CENTER-OF-THE-STORE ITEMS
Locally sourced items could boost center of the store with young consumers
Figure 57: Opinions of center of the store, by age, November 2015
Indulgence claims could resonate in certain center-store categories
Figure 58: Opinions of center of the store, by age, November 2015
Shopping responsibility relates to center-store perception
Figure 59: Opinions of center of the store, by grocery shopping responsibility, November 2015
USAGE OF THE CENTER OF THE STORE
Consumers suggest potential for revamped store center
Figure 60: Opinions of center of the store, by age, November 2015
Higher-income households looking beyond traditional supermarkets
Figure 61: Opinions of center of the store, by income, November 2015
Households with children seek to ease grocery shopping
Figure 62: Opinions of center of the store, by presence and age of children in the household, November 2015
Demanding dads looking to the center of the store
Figure 63: Opinions of center of the store, by parental status, November 2015
Hispanic Millennials more likely to embrace center-of-the-store foods
Figure 64: Opinions of center of the store, by Hispanic origin, by generation, November 2015
CONSUMER SEGMENTATION
Figure 65: Center-of-the-store clusters, November 2015
Group one: Fresh Finders
Figure 66: Opinions of center of the store, by fresh-minded consumers, November 2015
Group two: Loyals
Figure 67: Opinions of center of the store, by center-loyal consumers, November 2015
Group three: Center Shoppers
Figure 68: Opinions of center of the store, by demographics, November 2015
APPENDIX – DATA SOURCES AND ABBREVIATIONS

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