Retail Industry
Industry: Email Alert RSS FeedOverabundance of meal kits flattens category sales: meat-inclusive versions leading the trend to bolster packaged meal segment - Grocery - Brief Article - Statistical Data Included
DSN Retailing Today, July 29, 2002 by Debbie Howell
Just about every aisle of a food store now offers quick-meal solutions, from frozen skillet dinner kits to pre-marinated meats, but saturation may be at hand.
There's no doubt consumers want such options, but perhaps too much choice isn't good. Because other than blaming the recession, it's difficult to pinpoint a reason why dry meal kits lost some steam this past year, with unit sales flat.
One reason could be too many new products overwhelmed demand for packaged meal kits. A host of new brands have come on the scene in recent years, including Banquet Homestyle Bakes, Campbell's Supper Bakes, Stove Top Oven Classics and Lipton Sizzle and Stir. These kits come with the spices, pasta and vegetables needed to make a complete meal. In most cases, the consumer need only add meat.
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With consumers shopping so many different retail outlets today sales data typically available for food categories may only approximate true demand. At any rate, sales at food, drug store and mass outlets, excluding Wal-Mart, for a recent 52-week period showed unit sales of dry dinner mixes down almost 1%; other numbers provided by Information Resources Inc. revealed such kits with meat--a new category--tripling in size.
So while many brands suffered unit sales declines, ConAgra stole the show with its meat-inclusive kit called Homestyle Bakes. The new line generated $113 million in IRI-measured sales, growing to nearly half the size of Hamburger Helper, the top seller in the $495 million non-meat boxed dinner category.
"It has been a phenomenal business for us. It became a $100 million brand in a little over eight months. That's pretty unusual for a new product," said Kay Carpenter, director of communications for ConAgra's grocery and food group. She said the kit, which includes a can of meat, fulfills the need for a home-baked casserole dish, along with ease of preparation. The line includes 11 flavors.
Copycat products already are in the making. General Mills' Betty Crocker, the brand that started Hamburger Helper 31 years ago, this fall will launch Betty Crocker Complete Meals. These dry dinner kits include meat tied to its Progresso soup label, along with vegetables, sauce and either biscuits or potatoes. The initial product will come in six varieties and sell for about $4.69.
Though it doesn't include meat, Betty Crocker also wants to expand Hamburger Helper to its Oven Favorites brand. One of the new products on tap has the ingredients needed to make home-style meatloaf.
Campbell's, meanwhile, is meeting sales targets for its inaugural meal kit, Supper Bakes. This kit that debuted last year doesn't include meat either, but ties in with the equity of Campbell's soup, which spokesman John Faulkner said consumers have been using in recipes for years. IRI data showed the brand generated $33.4 million this past year, slightly behind more established brands in the $50 million range, such as Oven Classics and Tuna Helper.
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