In the food industry, they call it “speed scratch”: Packaged foods that make home cooking almost as convenient as eating out.
That approach to convenience is leading to a new product boom. Witness Kraft Foods Inc.’s latest lasagna kit, which packages just the right amount of pasta, sauce and cheese in a box, saving time in the supermarket. The only stop is the fresh meat aisle, where the kit and the meat sit side-by-side.At home, combine the premeasured ingredients in a baking dish, add ground beef and pop the whole thing in the oven. Voila! A family meal in about 45 minutes–and only one dirty pan.
“We’ve selected all the right ingredients; there’s no cookbook; and there’s no leftovers to clean up,” said Maurice Markey, category business director of refrigerated meals for Northfield-based Kraft, who is overseeing the launch of Freshmade Creations. “But mom still feels like she is in control of dinner.”
There’s the rub. In response to consumers’ cook-for-me demands, the food industry has spent years creating processed meals that can compete with fast food and Chinese takeout. The industry thought microwaveable meals were the answer in the late 1980s but had a hard time copying the taste and texture of home-cooked food.
In their zeal to play chef, food manufacturers have discovered that Americans still want to cook–but without all the fuss. Part of the lasting appeal of a home-cooked meal is psychological and emotional, especially for families.
“One of the ways that parents provide for their children is by cooking dinner,” said Ken Harris, a food-industry consultant at Cannondale Associates in Evanston.
So foodmakers have come up with meals that require little time and skill but still give the stove a workout. In addition to Kraft’s new entry, Campbell Soup Co. in July launched Supper Bakes, which include rice or pasta, seasonings and a baking sauce similar to its creamy soups. The product is a lot like Kraft’s, except that it is shelf-stable rather than refrigerated.
These two industry heavyweights are looking to create a stir in the $18 billion convenience-dinner business–a category that has grown 61 percent since 1994. It includes shelf-stable meals, frozen skillet dinners and dry mixes.
“Companies have identified a need, and now you have the major players getting involved,” Harris said.
And their timing could not be better, he added. “If the downward trends continue with the economy, you’re probably going to see more in-home cooking but not in-home cooking from scratch.”
With the category getting more crowded, all eyes are on Kraft, the nation’s largest food manufacturer. Because of its size–more than $34 billion in annual sales–and marketing clout, Kraft could overwhelm bite-size competitors.
On top of that, it’s no stranger to convenience meals. In 1998, Kraft transformed the classic Stove Top stuffing into an entire meal by adding sauces and seasonings to the box. The only ingredient missing was meat. With its clever tagline, “Sunday taste with Tuesday effort,” Stove Top Oven Classics took on the dinner-mix pioneer, General Mills’ Hamburger Helper.
Until then no one had seriously challenged Hamburger Helper, which controlled about 93 percent of the $525 million dinner-mix category before 1998. But in its second full year, Oven Classics captured 12.6 percent of the market, with sales of $65 million, according to Information Resources Inc., which tracks grocery store sales. Hamburger Helper’s market share had fallen to 74.5 percent last year.
General Mills fights back
General Mills Inc. is fighting back with new varieties of Helper, including Philly Cheesesteak. It’s also bringing back the animated Helping Hand in television commercials to celebrate the dinner mix’s 30th anniversary.
But Kraft’s assault is just beginning. Last month, the company bought Borden’s It’s Pasta Anytime! shelf-stable microwaveable meals, the first of what is expected to be several small acquisitions in convenience foods, snacks and drinks. Analysts expect Kraft to use the acquisition as a platform to launch other shelf-stable convenience meals.
At the same time, it continues to come up with new ideas, as in the refrigerated dinner kit, Freshmade Creations.
“No one has approached [convenience meals] with the kind of breadth Kraft has,” said Harris of Cannondale.
Freshmade comes in eight varieties, including Classic Italian Lasagna and Fiesta Taco Dinner Bake. These are not exactly light meals. One serving of the Three Cheese Chicken Enchiladas, for instance, has 17 grams of fat, or about one-third of the recommended daily allowance, and 1,350 milligrams of sodium, or 59 percent of the daily intake. And that’s not including the chicken.
Freshmade, which is now being tested in five Midwest markets, including Chicago, has a suggested retail price of $5.99. Throw in a pound of chicken or ground beef and a meal works out to be less than $2 a serving, which has become the benchmark for the convenience-dinners business.
New territory for consumers
While consumers may find the price is right and may perceive Freshmade to be of higher quality than frozen or shelf-stable meals, they are not used to buying dinner kits in the fresh meat aisle. Kraft recognizes that. “The challenge is educating consumers on exactly where to go in the grocery store,” said Markey of Kraft.
Campbell’s faces an even tougher road to reach consumers because it has never offered a prepackaged meal before. Campbell executives counter that the company is not making a big leap because consumers already use its condensed soup in recipes.
The success of recent launches gives Kraft and Campbell reason to be optimistic about their new entries.
Stouffer’s Skillet Sensations, a frozen mix of meat, vegetables and starch, was one of the best-selling new consumer products introduced during 1999-2000. Sales reached $122 million in the first 52 weeks of broad distribution, according to IRI. Only 3 percent of the 1,000 or so new consumer products launched annually clear the $50 million sales hurdle in their first year, IRI notes.
Stouffer’s, part of Nestle USA, is leveraging that brand equity to introduce this month a line of frozen meals called Oven Sensations. There are five varieties, including Yankee Pot Roast and Roasted Garlic Chicken.
In the battle against Kraft, Campbell’s and others, Stouffer’s is raising the ante on prep time. Just pour the contents of the package into a dish, stick it in the oven and 30 minutes later: Voila!
