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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

The center of the store, as defined for this report, includes food categories typically found along the interior aisles of supermarkets, grocery stores, and most supercenters. All retail sales of the specified items are included even though differences in store layout may mean that not all stores (particularly food retailers that are not traditional grocers) position these items in the store center. The following segments are used in this report:

  • Shelf-stable grocery: including processed meats, meat products, and meats included in processed food; packaged loaf breads, rolls, refrigerated bread dough, and cakes/pies/desserts; canned produce; shelf-stable snacks; and cereal
  • Frozen foods: including produce, frozen/prepared meals, and frozen snacks

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Table of contents

  1. 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

                                                                        • Data sources
                                                                          • Sales data
                                                                            • Fan chart forecast
                                                                              • Consumer survey data
                                                                                • Consumer qualitative research
                                                                                  • Abbreviations and terms
                                                                                    • Abbreviations
                                                                                    • Appendix – Market

                                                                                        • Figure 69: MULO sales and forecast of center of store, at current prices, 2010-20
                                                                                        • Figure 70: MULO sales and forecast of center of store, at inflation-adjusted prices, 2010-20
                                                                                        • Figure 71: MULO sales and forecast of shelf-stable grocery, at inflation-adjusted prices, 2010-20
                                                                                        • Figure 72: MULO sales and forecast of frozen food, at inflation-adjusted prices, 2010-20

                                                                                    Companies Covered

                                                                                    • Facebook, Inc.
                                                                                    • Twitter, Inc.
                                                                                    • Walmart Stores (USA)

                                                                                    Center of the Store - US - January 2016

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