Variety is the slice of life

Still, 48 percent of U.S. consumers are interested in a wider variety of pizza styles, according to “Category Insight: Pizza & Pies,” a November 2013 report from global market research firm Mintel. The report suggests that product development centered on ethnic and fast-food-inspired pizza could help breathe new life into overall U.S. retail pizza sales, which declined by an estimated 1.1 percent in 2013 and are forecast to decline further into 2018.

The decrease in sales can be attributed, in part, to increased spending on restaurant pizza and other away-from-home fare, the report notes, adding that 66 percent of U.S. consumers agree that store-bought frozen and refrigerated pizza does not taste as good as restaurant pizza. In addition to offering more variety, therefore, retailers must continue to work to improve the taste and quality of their store brand pizzas. They also should provide more choice in terms of styles and sizes and/or offer side dishes to better compete with restaurant pizza.

Give it a premium touch

Frozen pizza accounts for the lion’s share of retail pizza sales. One way to add variety and interest to the freezer case is via premium offerings.

“Today, consumers want upscale, artisan, restaurant-quality pizza offerings when they shop in the frozen pizza aisle,” explains Don Czerwonka, vice president of sales, Little Lady Foods, Elk Grove Village, Ill.

He points to interest in flavor-infused crusts — in sweet or savory profiles — and ethnic or culturally inspired ingredients.

Mike Pytlinski, brand director for Milwaukee-Based Palermo Villa Inc., says the trend toward premium mirrors what is going on in other areas of the store such as in the craft beer section. It also meshes with what’s happening in fast-casual restaurants. In recent years, for example, the growth of more upscale-type burger joints such as Five Guys and Smashburger has been more impressive than that of Burger King and McDonald’s.

Data from New York-based Nielsen show that the total frozen pizza category eked out a dollar sales gain of less than 1 percent in 2013, Pytlinski says. The bottom end of the frozen pizza category, which encompasses products with a regular retail price of $1.00 to $2.00, has been flat to down for several years. But the upper end of the category, products that boast a regular retail price of roughly between $5.50 and $7.00, saw double-digit growth during the same timeframe. In addition to premium pizzas, flatbreads are among the higher-end items gaining steam here.

“People are willing to pay for quality,” he stresses.

Premium offerings hold appeal on the refrigerated take-and-bake side as well, notes George Sarandos, CEO of Alpha Foods Co., Waller, Texas. That’s why his company uses a high-quality rising crust brushed with garlic/olive oil, whole tomatoes in puree instead of tomato paste and water, and cheese sourced from Wisconsin for the pizzas it creates for retailers’ private brand programs.

“Cheap is not the answer,” Sarandos, who is celebrating his 54th year in business, stresses. “There are people out there who are trying to sell a 16-inch pizza for $3.99. You cannot make and sell a product for $3.99 that has quality — that a family sitting down to dinner will enjoy.”

Add healthful options

To meet consumers’ desire for variety, retailers also would be wise to invest in some better-for-you frozen pizza offerings.

“Tasteful, healthy options are also very important,” Czerwonka says. “All-natural, organic, GMO-free, gluten-free, low-calorie [and] low-sodium options allow the consumers to take charge of their health without feeling deprived.”

Daniel Gemeiner, director of retail sales for Russo’s Retail Group, says a major category trend is toward fresh and natural ingredients.

“Gluten-free is a hot topic,” he adds, “and [gluten-free pizza] is in the top-three selling items in the gluten-free category of products. At Russo’s, we have gone a step further and make specialty gluten-free pizzas such as Chicken Rustica and Mulberry.”

Cover the basics

In addition to premium and healthful items, retailers still need to offer the core items that are in high demand among consumers, Pytlinski says.

“You have to have a strong rising crust and a strong medium crust … and thin and crispy is still growing,” he explains, “and then I think you can augment those with some more premium things like a flatbread or flavor profile. … Make sure you have a good breadth of products.”

Package for success

Variety and quality are critical to getting a repeat sale, but packaging is paramount to getting that first sale. With so many pizza brands and varieties occupying today’s retail freezer cases, retailers have to find ways to make their store brand packaging stand out from the rest.

For starters, a great photo can draw the consumer in, Czerwonka says.

“Clearly emphasize attributes [such as] all-natural, non-GMO, low sodium, etc.,” he advises. “Create an ‘experience’ on the package — the overall look should convey what the product is about: upscale, artisan, original flavor, etc.”

Pytlinski recommends that retailers take a hard look at the frozen pizza category to see which brands stand out and to determine a strategy.

“Don’t be afraid to celebrate your brand in the process,” he says. “Color scheme, architecture — if everyone’s zigging, you can stand out if you zag. But do it in a way that’s consistent with your brand and generally with the category.”

On the refrigerated side, packaging not only needs to pop, but also needs to communicate freshness and quality, Gemeiner says. Because space is rather limited here, he advises retailers to consider removing slower-moving items/duplications to make room for new on-trend items, too.

A colorful, attractive box also is a plus when it comes to attracting consumers to own-brand refrigerated pizzas, Sarandos says. And a window on the box is a must.

“You have to have a window in order for the customer to visualize the product, to see what the toppings look like,” he says.

Sway them to buy

Once they optimize the own-brand pizza assortment in relation to variety and packaging, retailers could take some steps to boost trial. Pytlinski recommends a holistic approach to own brands instead of a category approach. Such an approach encompasses communications programs and other initiatives that go across the whole brand.

“That brand stands for something, so consumers can buy it in one category and have the same quality expectations for another,” he says.

That said, other efforts specific to the category can wield positive results. Cross-promotions are one idea.

“I always believe in cross-promoting with other products that will enhance the meal and make it more of a culinary experience,” Czerwonka says. “Wines, craft beers, salad and desserts will work well.”

Product placement within the freezer or refrigerated case also matters.

“Many retail stores merchandise the packages lying flat instead of upright,” Gemeiner says. “This does not [allow] the customer to see the message the packaging is meant to deliver.”

Clearly communicating a specific benefit to consumers can help to convince them to try a pizza, too. Sarandos says Alpha Foods works closely with the Wisconsin Milk Marketing Board and includes the board’s Real Wisconsin Cheese logo on advertising, in-store signage and more. And the company will work with its retail customers to provide such signage for their own-brand refrigerated pizzas.

“Also, we encourage sampling of the product once or twice a month,” he says.

Finally, retailers need to promote their own brands instead of ceding promotions to the national brands, Pytlinski says.

“But don’t go overboard on it,” he stresses. “If you have the right product spectrum — value, mainstream and premium — then you don’t have to overly discount.”