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Popularity of Smoothies Drives Frozen Fruit Sales

The popularity of smoothies is skyrocketing – and with it, sales of frozen fruit. Read more in this recent Wall Street Journal article below.

 

Frozen Fruit Sales Soar As Smoothies Get Popular

Moving Out of the Frozen Dessert Case; Shinier, Resealable Bags

Frozen blueberries are a top frozen fruit choice for consumers when they blend smoothies.

WALL STREET JOURNAL

By Sarah Nassauer

Feb. 3, 2015 6:57 p.m. ET

Finally, after decades of sitting in a small corner of the freezer case, frozen fruit has landed its breakthrough role: smoothie ingredient.

We add frozen blueberries, strawberries and mango to our morning oatmeal, yogurt parfaits and our children’s lunches, drawn to frozen fruit’s year-round availability, value and health credentials (it is usually just fruit, frozen). We like that it is already cleaned, cut and that it never rots like fresh fruit forgotten in the back of the refrigerator.

Mostly we love making smoothies. Our appetite for smoothies as a healthy-yet-sweet snack for sipping on the go has thrust frozen fruit into the spotlight.

Dole Packaged Foods, the largest seller of frozen fruit in the U.S., estimates that in 2014 about 60% of frozen fruit purchased went into smoothies, up from about 21% in 2006. In both years the company studied at least 1,000 people’s frozen fruit eating and buying habits.

Frozen fruit sales have topped $1 billion annually, up 67% since 2010, according to Nielsen. This comes as sales of frozen vegetables and meals are flat, and shoppers feel general disdain for frozen food compared with fresh.

In part, frozen fruit got lucky. People are looking for easy ways to eat more fruits and vegetables. Fruit is sweet, making it easier for adults and children to gulp down than kale or broccoli. Frozen fruit also stays firmer and tastes riper than it did in past decades as food freezing technology has advanced. And interest in making smoothies at home is growing. U.S. blender sales have risen in tandem with frozen fruit sales, hitting more than $1.16 billion in 2014, more than double the $571.9 million sold in 2009, according to market-research firm Euromonitor International.

Dole was looking to build its business beyond fresh produce and employees saw potential to grow its paltry sales of frozen fruit, then primarily considered a dessert ingredient.

Most frozen fruit was sold in flimsy store-brand white bags, stacked flat on top of each other, says Paul Panza, senior director of marketing at Dole Packaged Food. Freezer burn was common, fruit quality was low and shoppers often breezed past the bags hidden near frozen whipped toppings, says Mr. Panza. But frozen fruit had “potential because the product itself is healthy,” and convenient, he says.

Dole developed shiny bags that stand up. It covered them in colorful photos of fruit and berries, making it easier to spot them in the grocery store. It printed healthy recipes for smoothies and salad on the bags. A resealable closure was designed to help customers fight freezer burn at home. The bags went on sale in 2005.

(Dole Packaged Food, which sells frozen food under the Dole brand, is now owned by Japan’s Itochu Corp. Dole Food Co. sold the unit in 2013.)

Dole hopes to persuade more retailers to put frozen fruit near vegetables, not whipped topping, to boost its healthful image, Mr. Panza says.

Kelsey Keag, a 32-year-old marketing and communication manager at Indiana University who lives in Bloomington, Ind., began making smoothies often when she was pregnant with her now 2 1/2-year-old son. She prefers frozen fruit to fresh because it creates a smooth, icy texture in smoothies more easily than adding ice cubes and it is less expensive.

Most mornings she digs into a 6-pound bag of frozen pineapple, strawberries, peaches and mango purchased at Sam’s Club, and mixes in fresh spinach, chia seeds and a splash of orange juice and water. While her husband doesn’t partake, her toddler son asks for “the green drink,” every morning, she says.

The smoothies are “an easy way for me to get in a couple of servings of fruit and vegetables without really eating it,” Ms. Keag says.

Frozen fruit buyers are gravitating to large bags, organic versions and berry blends, says Michelle La Berge, marketing manager for Cascadian Farm, a line of organic foods from cereal to frozen produce owned by General Mills Inc. This summer the company will start selling 28- and 32-ounce bags of frozen strawberries and blueberries.

It has designed new packages that will be made of thicker plastic covered in shiny graphics, some that sit upright on shelves and have resealable zippers, says Ms. La Berge. The new packaging “pops and looks better on shelves,” she says.

Sales of organic frozen fruit are growing faster than nonorganic versions and now make up about 12% of sales, Ms. La Berge says.

Costco Wholesale Corp. is searching for more organic frozen fruit to keep up with demand, especially cherries and strawberries, says Scott O’Brien, assistant general merchandise manager at Costco. The club store chain is stocking stores where organic food sells best and is working to find more suppliers, he says.

Smoothies are eaten at home regularly by only about 1% of people, but the number is growing, according to NPD Group Inc., a market-research company. Like juicing—another trendy way to drink your fruits and vegetables—the idea of what constitutes a smoothie is moving beyond adding a banana to ice cream in a blender.

Last spring Target Corp. started putting “smoothie additives,” near frozen fruit aisles in some stores— the company’s term for dry smoothie ingredients like hemp seeds, chia seeds, and goji berries.

Dole is packaging more fruit blends, often including tropical fruit like mango and pineapple, which are time-consuming to chop when fresh. Sales of berries are booming, while peaches, a classic dessert topping, are growing more slowly.

The company says it recently cracked the frozen code on mandarin oranges. These small sweet oranges are a longtime best seller for Dole eaten in fruit cups or canned, but citrus is tricky to freeze.

The delicate cell walls in oranges or grapefruit “will almost explode on you,” as the fruit freezes, says Jon Rodacy, vice president and general manager of packaged frozen foods for Dole.

Over 10 years of tinkering and three years of tests, company researchers learned that picking mandarins at peak ripeness and freezing slices quickly mean the fruit stays intact when it thaws. “You cannot have a less-than-ripe mandarin otherwise you will end up with a puddle of mandarin on the consumer’s plate,” Mr. Rodacy says.

Dole last fall started selling a frozen fruit blend including mandarins and plans to sell bags of frozen mandarin oranges this spring, he says.

Write to Sarah Nassauer at sarah.nassauer@wsj.com