Retail Frozen Food Market in Denmark Marked by Several Contradictory Trends
By CHARLES FERRO, QFFI Correspondent

This new Thai Soup offering, distributed frozen under Dansk Supermarked’s Den Grønne Slagter private label, contains no more than 3% fat per serving.

Weekly flyers from Føtex (Dansk Supermarked), distributed to households as well as in-store, feature a myriad of frozen food specials. This one offers deals ranging from value added potato and bread products to mixed fruit.

Ready meals are on the rise, while poultry is in decline. Danes look for healthy eating options, yet consume relatively little seafood, and spend less time shopping and cooking.

Frozen food sales in Denmark remain quite healthy, but a look at the market and research surrounding it suggests a lot of contradictions. Although official statistics from domestic sources do not exist, Geneva, Switzerland-based Food for Thought ranks the country third in Europe in terms of per capita consumption at 46.5 kilograms per annum.

Scandinavian neighbors Sweden and Norway are first and second, respectively, with per capita consumption of 48.5 and 47.7 kilograms.

Like other segments of the grocery business, price remains a factor in supermarkets; Danes are spending more in up-market specialty shops, but pinching pennies in supermarkets. In terms of trends, convenience, ecology and health – the last spurred especially by obesity awareness campaigns – are becoming more prevalent.

Healthy foods may get a boost now that EU regulations allowing packaging to proclaim health benefits have gone into effect. The new rules, which were introduced last July 1, have been met with some criticism in Denmark – and probably other countries – despite rather strict guidelines.

One health-oriented range from Dansk Supermarked (DS) spotted by this reporter was the Minimum private label, which proclaimed fat content of just 2.5%. The products are basically ready meals with ethnic themes such as Indian Rice, Thai Red Curry and Pasta Bolognese. The soup mentioned above also fits in here.

Deluxe vegetables or mixes sold under DS’ Luxus Grønt store brand are products at the high end. Most of them are vegetables from the region, such as carrots, peas and corn.

DS also features soups under the Den Grønne Slagter label, telling the consumer they contain just three percent fat. The soups come in Thai-seasoned, Cheese and Ethnic Tomato varieties.

An apparent driving force – arguably the only one – behind frozen food promotions is price. Retailers regularly feature frozen items in their weekly flyers, distributed to households and picked up as point of sale material in outlets. Shoppers also see specials advertised for products in freezer aisles.

Much of this plays into consumer habits, as Danes tend to do a lot of spot shopping – that is, many of them shop several times a week as opposed making one weekly shopping trip. This is especially true for urban dwellers, whereas a greater proportion of rural residents will drive to a supermarket and buy big.
Reports from the Danish Agriculture Council indicate that Danes are spending less time shopping and cooking than ever before. Food retailers have responded by changing interiors to stimulate speed shopping, and by offering more convenience foods. However, as the Council points out, convenience food does not have a good image among consumers, either they do not recognize convenience foods as such or they turn their noses up at it.

Market Contradictions

Coop Danmark, part of the pan-Nordic Coop Norden group, reports that sales of ready meals and frozen pizzas are on the rise, while turnover of chicken and other poultry products continues to decline.
Poultry has been hit by a double whammy, first fears of Salmonella bacteria – though the prevalence has been cut dramatically in the past five years – and then the Avian flu scare. Consumers apparently found alternatives to poultry and have stuck to newer eating habits, although poultry remains the top frozen seller nationally in terms of total weight.

In one Copenhagen Føtex, the hypermarket outlets of the Dansk Supermarked group, Quick Frozen Foods International took notice of a whole aisle of frozen chicken/poultry products. The Oliver label alone had chicken Kiev, nuggets, wings, kebab pieces, and similar turkey products. All grocery outlets generally have low-priced whole chickens.

Seafood has benefited from consumers shying away from poultry and from moves to eat healthier foods. At the same time, Danes statistically eat the least amount of fish and seafood among consumers of all European countries. This, surprisingly, is despite the fact that the country is made up of several hundred islands in two seas.

Small dumplings for making soup are popular with Danes, and this beef-filled offering comes in 1,000-gram bag.

Raspberries in 275-gram bags are among the organic fruits and vegetables sold at Irma supermarkets under its Økologisk Balance range of products.

Recent reports on so-called “fresh” seafood – which was shown to be up to 15 days old – may have helped sales of frozen fish. What’s oddly missing are promotional campaigns from frozen producers about the benefits of frozen seafood (and the same holds true for vegetables). The position of so-called fresh product was weakened, creating a gap for frozen seafood to step into.

Private label products account for around 30% of all frozen food sales, and they are particularly visible in the areas of seafood and vegetables. Generic products, shrimp, breaded or regular fillets of saith, cod or sole, and a few other species have been gaining more space in freezers. Price is the attraction.

At Coop they sell a fair volume of own label breaded fillet of sole with filling, as well as cod fillets, but very few branded packs containing such value-added fish.

Dansk Supermarked (DS), with its Bilka, Føtex and deep-discount Netto outlets, reports an increase in sales of frozen seafood. DS’s store brand in the seafood department is Seven Seas, which features almost two dozen stock keeping units. Seven Seas carries whole fish, fillets and value-added items including breaded and filled fillets.

DS reports that it is somewhat difficult to win consumers over to newer species, as most prefer familiar products such as cod, sole, herring and salmon. Still, they do expect to see sales of exotic species rise, especially imports from Asia. Oddly enough, the Danish Agriculture Council reported that Danes are more likely to try new things than their Nordic brethren, but this probably does not apply to the freezer section of markets.

One item that has boosted seafood sales is imported farmed jumbo prawns, a selection that has been on the rise since its introduction around 15 years ago. Many of them are sold in what looks like generic packaging, though there may be a “label” stating source or the importer. Irma, Coop’s top-end outlets, carry a private label jumbo prawn product with the store name on the label.

Smaller in size, North Sea or Atlantic shrimp remain a staple in frozen food sections and are sold in a variety of package presentations. Hypermarkets and some supermarkets will sell family packs weighing up to 1,750 grams.

Ready Meals

Another seeming contradiction is the ready meal. A survey done by pollster ACNielsen indicates that shellfish and ready meal sales are climbing. But the same source also found that Danes are the least receptive population in the world when it comes to ready meals: nearly half of those surveyed said they most likely would not purchase ready meals, while 19% said they never purchase them.

Reports from the Danish Agriculture Council confirm consumer reluctance. But ready meals are the next-best selling frozen item in Denmark, after chicken, and followed by vegetables, desserts including ice cream, baked goods and soups, which could be called ready meals.

Danes have traditionally bought a lot of soup, as well as packages containing broth and a separate pack with dumplings and/or tiny meatballs. A meal for three persons would then weigh in at almost one kilogram.

Spicier ethnic varieties of soups have also made inroads. DS recently launched a new line, Minimum, which features a low-fat Thai soup and other selections which have been solid sellers.

There could, however, be some margin of confusion regarding the definition of a ready meal. Sales of pour-and-heat products have soared in the past few years, usually vegetable and rice/pasta mixes to which meat or seafood can be added. All markets carry them, usually in an assortment of ethnic mixes.
But a lot of consumers would say a ready meal is a product that one puts into an oven and then serves, not recognizing the pour-and-heat products as ready meals. On top of it, some consumers may be stuck in the notion that a ready meal contains a traditional entreé with potatoes, something like a TV dinner.

Growing Health Trend

Sales of healthy frozen products have risen in the past few years, and their presence in freezer cabinets has increased dramatically in just the past year. The National Bureau of Statistics reports that sales of vegetables on the whole rose by more than 10% in the three-year period to the end of 2006.

This general trend was pushed along by a national campaign urging citizens to eat at least 600 grams of fruit or vegetables daily. For the record, the average Dane still consumes approximately 250 grams of meat per day, and half of this is pork.

The second aspect of the health trend is ecological or organic foods. With the exception of just a few baked goods, nearly all so-called “ecological” products are fruits or vegetables. In some stores, especially at Irma, such items may take up 10% of freezer space allotted to fruit/vegetables.

Irma’s ecological vegetables are under the Økologisk Balance private label. The outlet’s organic fruits, generally berries or berry mixes, are gaining in popularity. Several times in the past year, the items have been on sale, with three bags going for a favorable price. The goods are advertised in weekly flyers and in-store.

At a Copenhagen Føtex, this reporter eyed a whole aisle of frozen vegetables, potatoes, and some baked goods. Vegetables have always had their place, but the spuds and baked goods have expanded freezer sections. Many of the breads are inspired by Mediterranean recipes. Value-added potato products, with the exception of basic french fries, have gained footholds in the past 10 years.

Meanwhile, a lot of new products in novel shapes or with innovative flavors are produced with kids in mind. They often come and go – though some aimed at kids win space – but slices and “boats” have earned permanent spots in freezers.

Promotion Campaign Needed

While a fair number of consumers understand the benefits of frozens, mostly through positive articles in newspaper or consumer publications, what’s sadly lacking is a campaign from the industry to bring the message home. It may be a broad generalization, but frozen fish is fresher, the vegetables are more nutritious, and all frozen food is certainly convenient.

Each element of food trends and retailing seems to pose some contradiction, and frozens would certainly get a boost from a national communications campaign. Still, frozen foods are holding their position in Denmark.