-By D. Gail Fleenor

For many consumers, eating "healthy" revolves around natural and organic frozen foods. While the down economy caused some health-seeking shoppers to trade down to lower-priced frozen items or meals prepared from scratch, most should return to a natural/organic menu as times improve.

Once a niche market, natural and organic foods are now big business, according to Chicago-based market research firm Mintel. While the frozen organic food and beverage segment did well in 2007, it underperformed in 2008, Mintel says, with sales sliding in 2009 when the recession was in full bloom. Mintel expects 2010-2012 organic frozen sales growth of 28 percent, with sales reaching nearly $1.1 billion in 2012. Organic/natural frozen vegetables was one of the top categories in new product launches from 1998 to 2009.

Since two-thirds of consumers purchase organic food in conventional supermarkets, according to Mintel, retailers should benefit as consumers again opt for the convenience of frozen natural/organic foods. Private label will also drive overall organic growth with a 24.2 percent share of sales as many retailers have increased their corporate brand organic selection. For example, Supervalu's Wild Harvest organic store brand doubled in size since the year it launched, Mintel says, "as they were well prepared for recessionary purchase shifts and are now reaping the reward."

The two top sales growth categories in organic/natural frozen foods at supermarkets, according to SPINS, a market research and consulting firm for the natural products industry, are frozen fruits and vegetables, and frozen entrees, pizzas and convenience foods. Sales of natural or organic fruits and vegetables rose 19.1 percent in 2008, while sales of natural/organic frozen entrees, pizzas and convenience foods rose 13.5 percent.

In the Case

The case or door space devoted to natural and organic frozen foods varies by chain, store size and customer base characteristics. Some retailers choose to merchandise natural and organic frozen food separately, while others prefer to blend these items into traditional frozen categories. Giant Eagle has three different sets for natural and organic frozen food, varying by store. "Our typical natural and organic set has been about nine doors," says Diane Roberts, senior director, frozen foods, for the Pittsburgh-based chain. "This is fully integrated in some stores such as pizza next to pizza, vegetables next to vegetables. In other stores, the category is segregated in a separate area, while in [yet] other stores, natural/organic is segregated but in the frozen aisle."

Giant Eagle's own Nature's Basket pizzas and Full Circle vegetables are strong sellers, according to Roberts, along with the Amy's Kitchen line of entrees and pizzas; Kashi entrees, pizzas and waffles; Cascadian Farms vegetables and fruit; and Food for Life breads.

With a typical set of four doors, about 36 percent of Marsh Supermarkets have sections devoted to natural and organic frozen foods, according to Jeff Wagner, business manager for the Indianapolis-headquartered retailer.  "Amy's [Kitchen] continues to lead the SKU count and accounts for some of the best-selling products in the frozen organic sections," notes Wagner. Other popular natural/organic items at Marsh include JFC frozen soybeans, which he terms "an outstanding-selling item," and Food for Life bread items.

"Based on store size, we will have from one to seven doors of organic products in our stores," says Kevin Albritton, SVP, category management, at Tyler, Texas-based Brookshire Grocery Co. "A lot of our organics are integrated into regular frozen sections."  His company's best-selling natural and organic brands include Amy's Kitchen dinners and entrees, Morningstar Farms, and the Ezekiel bread line.

Natural/Organic on Ice

Check out the selection of natural and organic entrees and pizzas in most supermarkets, and odds are Amy's Kitchen dominates the categories. The nation's leading natural frozen food brand continues to add life to the category with new ethnic flavors, gluten-free products and even cakes. "Amy's has been very active with new items over the past year," says Steve Warnert, director of sales & marketing for the Petaluma, Calif.-based brand. "Among our new-product 'superstars' [are] Amy's Tamale Dinners. Amy's Organic Frozen Cakes have also met with immediate success." The brand's gluten-free offerings have additionally seen strong sales, he notes. "In the past few years, Amy's has become a refuge for consumers with diet restrictions."

Warnert says Amy's has bucked the trend of severe recession-related declines experienced by many suppliers. "We've definitely felt the economic pinch but have been able to maintain sales. The economic downturn confirmed for us how loyal our customer base really is." One reason for this is that "overall, it's no longer uncommon that the average household would have natural products or organics in the pantry," he notes.

Caesar's Pasta hasn't suffered in the down economy either, says Ron Lodato Sr., VP of the Blackwood, N.J.-based family business, which offers a wide range of traditional Italian pasta dishes, from lasagna to manicotti. "We're finding growth of 10 [percent] to 12 percent in organic/natural foods," he observes, adding that he expects the market to continue to grow "until it supersedes conventional food products."

All Natural Gluten-Free Potato Gnocchi, also available in a spinach variety, is Caesar's newest product. Other recent introductions from the company include a popular line of four microwaveable gluten-free entrees: stuffed shells, manicotti, vegetable lasagna and cheese lasagna, all in marinara sauce.

San Rafael, Calif.-based Annie Chun's All Natural Asian Cuisine is debuting new frozen items nationwide this spring, including 100 percent Organic Potstickers in either Chicken & Vegetable or Pork & Vegetable varieties. Featuring a wrapper that's crispy on one side and tender on the other, the product has no MSG or trans fats.  Another new product line due this spring — bite-sized Mini Wontons — can be cooked in the microwave or pan-fried.

Natural/organic products are popping up throughout the frozen case. For example, TRUwhip, an all-natural whipped topping from Boise, Idaho-based Peak Foods, debuted in time for the 2009 holidays. The nationally available gluten-free topping contains no genetically modified organisms, hydrogenated oils, trans fats or high-fructose corn syrup.