Sponsor (Oct-Dec 1964)

FROZEN FOODS' TREND TOWARDS TELEVISION* No. of brands General Farm News News Net Spot Year advertised mags mags papers sects, tv tv 1962 85 $4371 $8158 $1719 $1049 $5823 1963 100 4026 5813 1699 4328 6880 *Dollar figures given in thousands. Source: Food Field Reporter. How it ail began First introduced commercially shortly after World War II, frozen foods were immediately heralded as the century's great new industry, a reputation that, after an initial spurt, they failed to fulfill wholly. In fact, after 1946 the industry went into a seven-year slump before, in 1953, annual results once again matched earlier records. Since then, however, the industry has been expanding almost as predicted. Today's typical distributor is much better established than he was seven or eight years ago. And he now appears to be on the threshold of stiJl further notable gains — providing he uses advertising adroitly enough to catch a ride on the expected surge. STRUCTURE ON WHICH ADVERTISING RESTS The usual range of frozen food prices begins at 5 or 10 cents (the cost of some punches, junior pizzas, popsicles and the like) and reaches a high of between $1.75-$2.15 (for complete dinners, specialties like prepared seafood in special sauces, etc.). The average price is about 33.6 cents. A Nielsen study of the frozen food market indicates that nearly half (46.4 percent) of the million and a half transactions studied ranged between 22-39 cents. E. W. Williams, publisher of Quick Frozen Foods, and other spokesmen for the industry, have noted these main developments that "should accelerate" within the next five years: (1) Frozen foods will continually account for a greater percentage of total food-store sales. The longstanding target that now looms as a real possibility: 10 percent. (2) As a corollary, per-capita consumption will continue its upswing. Today, the average family of four spends some $5.24 per month on frozen goods, obtaining about 10 pounds of food. For the industry to realize its 10-percent goal, that family's spending will just about double. (3) Advertised brands will consolidate into fewer — and stronger — brand names. Leaders right now in general order of precedence are Birds Eye, Green Giant, Sara Lee, Swanson, Libby, Minute Maid, Stouffer, Morton, Banquet, Chun King, Wakefield, Gorton's and Sea Pack. (The top 20 of 270 frozen-food packers accounted for more than 65 percent of total sales, and 18 of those 20 sold more than $10 million.) And, according to Supermarket Merchandising, the five largest chain purchasers of frozen foods last year bought more than 50 percent of the total under their own labels. (4) Improved and, in part, revolutionary freezing and distribution methods are on the way. For example, mobile freezing plants in giant trailer trucks do a "magic freeze" (with liquid nitrogen at -320° F.) at harvest sites in the fields. Expected results: the successful freezing of such hitherto reluctant commodities as avocados, cabbage, lettuce, mushrooms, onions, tomatoes and the like. (5) Conversion of more industries to freezing, much as already has been happening in bakery goods. For example, many bakers now freeze most of their bread, even though they don't sell it frozen. Similarly, it's now standard to freeze meat and poultry at packing plants, a matter that requires "just one more step" to deliver them frozen to the consumer. Freezing will allow many producers to level the peaks and valleys in their demand-charts, which is about what happened with frozen juices to revolutionize — and stabilize — the Florida citrus industry. More recently, the successful marketing of frozen french fries has wrought comparable wonders with the potato economy of Maine and — to a lesser degree — Idaho and Washington. (6) Food retailers will continue to encourage the trend towards freezing. Main reason: Even in small stores, frozen food profits run as high as 8 percent (a considerably greater profit than their sales volume would indicate, when compared to the norm for dry groceries). In a high-volume supermarket the profits may climb to 15 percent. (7) Distributors will continue to lend a hand — most notably an advertising hand — because frozen foods have lower direct product costs than other groceries. Thus, the distributor can afford to spend more of his sales dollar on advertising — in short, to spend more in order to make more. Altogether, these trends should set up a momentum for notable advertising increases, especially on tv. Food and grocery advertisers, already tv's most active, should boost their no. 2 product group, frozen foods, into major billing prominence. Quick Frozen Foods' Williams puts it in a nutshell when he considers the "specialty" foods that, so far, have been too special to achieve mass volume. How can they attain the big-time? he wonders. And he supplies an industry's answer: "Not by cheap price, certainly, but by advertising . . ." ♦ December 28, 1964 35