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Multiple retail food categories perpetually jockey for position with foodservice, striving to communicate the merits of providing a restaurant-style experience at home while saving money. Few products face this proposition as acutely as frozen pizza.
Eye on the National Brands
Front-of-package (FOP) foodservice claims are on the rise with the national brands. Nestlé’s DiGiorno in particular has taken this marketing and formulation tactic to heart, with the “pizzeria style crust” boldly proclaimed on all products in the new Pizzeria! line (Primo Pepperoni, Supreme Speciale, Quattro Formaggi/Four Cheese Pizza, Italian Style Meat Trio). Other FOP claims on the products include “preservative free crust” and “no artificial flavors.” Also, at first glance, the crusts in the line appear slightly irregular, a key factor in creating the look of a handcrafted product.
And while select retailer brands have made some strides in quality of late, private label cannot stagnate in the face of continued pressure from branded competition—and from the rise of fast-casual pizzeria chains like Pie Five Pizza and Blaze Pizza that turn out custom pies in minutes.
The greatest opportunities in retail grocery today exist at the value-driven and premium-product tiers—but with price-acceptable quality evident throughout. And these lines require targeted approaches that position the products as viable—and enjoyable—alternatives to delivery or carry-out from the local pizzeria.
The Retail Pizza Market
According to SymphonyIRI, the retail frozen pizza market took in over $4.3 billion for the 52 weeks ending October 6, 2013. But private label accounts for only about 10 percent of that business in both dollar and unit share. Clearly, retailers have ample room for further penetration into this category.
One emerging bright spot is private label frozen pizza crusts/dough, which skyrocketed over the last year, up 86 percent in dollar sales and 79 percent in unit sales, per IRI. This indicates a consumer desire for value-driven alternatives to speed-scratch home pizza preparation—and likely points to a quality gap in frozen private label pizzas. If people cannot find what they are looking for in a fully prepared private label pizza—embodiments of commingled value and quality—they’ll make the extra effort to build their own pie at home using some time-saving shortcuts.
After all, scratch-made pizza crust can prove tricky. And as Alessio Lucchese, sales director USA for Roncadin SpA, noted, “The crust is the secret for a pizza.”
Take-and-bake refrigerated pizza is another category that’s performing well—one that’s dominated by store brands, largely due to the products’ perishable nature, with private label accounting for over 55 percent of dollar share over the past 52 weeks, per IRI.
Upping the Culinary Ante
Authentic pizzeria pizzas, from traditional and contemporary Italian versions to artisan regional craft pizzas, are driving the growth in the category, noted Brad Rostowfske, director of innovation & new business development, Palermo’s Pizza. “Progressive brands and retailers are launching new pizzas,” he said, “platforms that build off consumer’s experiences at the next generation of pizzerias.”
Retailers who maintain a strong presence in a regional market—particularly a strong pizza market, such as Chicago—will find inspiration in foodservice, as well as in the frozen products foodservice companies bring to retail grocery channels. Consider the strong showing Chicago-style pizzeria brands like Uno, Gino’s East, Connie’s, Home Run Inn (the top frozen pizza in the Chicago market), and Vito & Nick’s (a longtime South Side staple but a newcomer to retail) have made in the freezer case in Chicago, some of which have national distribution. As select segments of pizza move more upscale, these foodservice brands—in addition to the strictly retail products formulated by Nestlé (DiGiorno, Tombstone), Schwan’s (Freschetta, Red Baron), Kellogg’s (Kashi), etc.—require analysis.
But while the private label industry needs to keep tabs on the national brands, we can’t neglect the impact of foodservice pizzeria brands, which often have an upper hand in terms of culinary quality. And the leading edge in this market, noted Rostowfske, is in “true pizzeria quality, phenomenal artisan crusts, phenomenal sauces crafted to work with the crust and toppings, and—last but not least—phenomenal quality and quantity of toppings, delivering a super-premium eating occasion.” He suggested that these are products “where the quality is so great, it can demand a premium retail price like $8 to $10.”
Regional can also apply to products inspired by international destinations, as we have seen in the progressive regionalization of Italian products in general. Lucchese tapped “specific recipes and dishes of specific area” as a leading trend in pizza today. “Americans like to travel through taste,” he said. “A pizza or an Italian dish must be able to carry people away directly to Naples, Rome or Florence, to enjoy colors and flavors of a particular region of Italy. Italians like to offer products and recipes that reflect the traditions and culture of a specific territory. This trend will grow for a long time.”
Neapolitan-style pizzas have risen in popularity of late in foodservice, and a store brand that can effectively replicate that “Naples pizza experience” in a frozen product will likely find a willing audience. Neapolitan crusts traditionally feature an ultra-thin center with a more-pronounced outer edge that balances crispy and tender characteristics—and must be fired in a high-temperature wood-fired stone oven, with visible char and blistering to prove it.
With artisan and regional expectations come those for quality, as well. “Pizza manufacturers should focus on total quality,” said Lucchese. “Pizza can be frozen, but it has to be delicious like a pizza eaten at the best pizzeria. Manufacturers should be also dynamic to catch trends and new tastes.”
According to recent research from Mintel, more than half of U.S. consumers say they usually prefer pepperoni (65%), sausage (54%) or mushroom (51%) on their pizzas. This is followed by extra cheese (45%), onion (39%), green pepper (37%), olive (34%), bacon (31%), ham (29%) and pineapple (21%).
But new ingredient combinations are starting to catch shoppers’ eyes. Rostowfske cited the following combinations as trending-forward:
• Spinach and goat cheese
• Pesto and fresh mozzarella
• Loaded potato, with roasted potatoes, bacon, Cheddar cheese and sour cream
Rostowfske also pointed toward sauces like crème fraîche and olive oil as interesting alternatives to a tomato sauce base, “culinary crafted sauces that deliver something special to the pizza,” he said.
A base of olive oil works particularly well on something like a barbecue chicken pizza, when the shredded chicken topping is accented with barbecue sauce that’s released by the topping during cooking—an approach to formulation that can also help the chicken maintain its juiciness and tenderness while frozen.
“Another area that is hot is flatbreads,” said Rostowfske. “Once again, consumers have been conditioned to seeing flatbreads on almost every restaurant menu. Flatbreads open up a whole new consumer usage occasion for the category. Now they can have them at home as a light meal or appetizer. This flexibility also opens up many new flavor varieties to the category.”
Rostowfske also noted the emergence of other niches in pizza. “We continue to see more interest in gluten-free, organic and all-natural pizzas,” he said. “More and more consumers are looking for ‘better-for-you’ ways to enjoy pizza.”
Building Your Brands
“For a store brand to be successful in these unique trend areas, they need to have a solid core private brand program,” Rostowfske. “Once consumers believe that the store brand will deliver, they are more likely to believe that the brand is capable of delivering in these new product areas. Those that have focused on building their brand have set themselves up to enter into these areas. The best regional and national retailers are poised to leverage, or are already leveraging, many of these consumer trends.”
The key here is to build a range of store brand pizzas that all communicate price-proportional degrees of foodservice-inspired culinary quality, from value-driven products through higher-end options.
“In order to attract customers, I think that retailers should create and offer very special private label ranges of frozen pizzas,” said Lucchese. This is achieved, he suggested, by creating a balance between recipes, price and range.
“Consumers are looking for higher quality, for a pizza with unique ingredients,” said Lucchese. “They want to try a food experience coming from Italy, through the freezer, baked in 10 minutes and ready to eat. Is that possible today? Yes it is.”