09Mar2011

Asian Foods Surge 11%

Frozen Asian entrees surged ahead by 11% to $907.1 million in the 52 weeks ended Jan. 22, according to data from The Nielsen Company.

That data, which include sales in food, drug and mass merchandising outlets (including Walmart), also shows units ahead by 7.3%, to 304.1 million.

The introduction of General Mills’ Wanchai Ferry in late 2009, followed by Unilever’s P.F. Chang’s Home Menu last year, has given the frozen Asian food segment a real shot in the arm. In supermarkets, P.F. Chang’s already ranks as the fourth-best selling brand in the multi-serve frozen dinners/entrees category, while Wanchai Ferry owns the number-seven spot, according to SymphonyIRI Group, the Chicago-based market research firm.

“The increased (advertising) spend created more awareness of a category that hasn’t gotten a lot of attention in the past,” says brand manager Laura Black Grenmyr of Gahanna, Ohiobased Kahiki Foods (www.kahiki. com ). “And the entry of those two big players forced companies like us to become even more discerning,” essentially raising the bar for everyone.

MORE SPACE
Retailers seem willing to give the category more space now that the big brands have jumped aboard, but observers feel frozen Asian foods are still underspaced.

According to Chicago-based Technomic, Chinese is second only to pizza as the country’s most popular take-out food. “But look at the amount of (freezer) space dedicated to top-seller pizza and compare that to Asian,” says Mark Phelps, president and COO of Tukwila, Wash.-based InnovAsian (www.innovasiancuisine. com).The discrepancy is jarring. “Asian is growing faster than most other frozen categories,” he continues, noting that more space would grow it even faster.

Insufficient space isn’t the only problem, however. Grenmyr estimates that less than a third of retailers merchandise frozen Asian foods together. “But we think having an Asian door encourages add-on sales of complementary products like egg rolls, which, when placed next to a main dish like, say, Beef Mongolian, serve as a reminder to consumers of what else is available.”

Many retailers have separate Mexican, Asian and Italian sections in dry grocery, adds James Johns, assistant vp of processed foods for Santa Fe Springs, Calif.-based Day- Lee Foods (www.day-lee.com). “So why not bring that concept to frozen, too?” he asks.

That’s how Walmart’s done it for the past couple of years, reports Phelps, who says the Bentonville, Ark.-based chain now owns a bigger share of the Asian frozen food market than it does the frozen food market as a whole. Retailers with destination sections get a greater share of Asian frozen food sales than their competitors, he adds.

ASIAN ENDCAP
Another retailer, Tewksbury, Mass.- based Demoulas Market Basket, puts Asian frozen foods together in an endcap. When Joyce Chen potstickers were moved from the frozen pasta section to the new Asian endcap, “We saw sales go up,” reports Stephen Chen, president of the Acton, Mass.- based manufacturer (www.joycechenfoods. com).

Placing frozen Asian items together also makes cross-merchandising a cinch, says Grenmyr, whose company plans to offer consumers who buy two of its family-size entrees a free package of Kahiki eggrolls later this year. Pay-one-price meal deals that include several different Asian meal components from around the store also work well. But so do meals without the deal.

For example, for its Jan. 26 “Daily Meal Idea,” Wegmans’ web site listed Atlantic Salmon Fillets with Citrus Soy Sauce and Ginger and Garlic Stir Fry Blend. The meal required just three of the Rochester, N.Y.-based chain’s own brand frozen and refrigerated products, none of which was on sale.

Asian foods can also be included in ads with similar non-Asian products being offered at a single hot price point. With net pricing, explains Johns, retailers often create their own ads for large national brands. But if they’re already advertising, say, family-size Stouffer’s Lasagna, “Why not include our Mandarin Orange Chicken and another product or two at the same price?” he asks.

Grenmyr adds that retailers often targeted only existing Asian food buyers, ignoring opportunities to bring in new users. So it’s no surprise that she is a big proponent of sampling. While some manufacturers are leery of demos, “We’re actually looking to offer more demos this year,” she reveals.

MAINSTREAM TARGET
Because Kahiki’s target is mainstream (Caucasian consumers index higher for Asian food purchases than Asian consumers), “Getting the food into their mouths helps dispel the myth that Asian food is too spicy or too exotic or that the kids won’t like it,” she explains. When Kahiki demos the company’s Tempura Chicken Nuggets later this month, “We’ll also hand out recipes that give consumers ideas for how to use them in different ways versus just mixing them with rice.”

Demos can take many forms. A Whole Foods in Novato, Calif., recently demo’d Tang’s Natural Whole Wheat Dumplings from Brooklyn, N.Y.-based TMI Food Group (www. twinmarquis.com). To help celebrate Chinese New Year early last month, a presenter at the store showed how to pan fry the dumplings and discussed alternative prep methods. That’s key, “because many customers won’t buy a pack of frozen dumplings unless they know how to cook them,” says Kevin Li, TMI’s sales and marketing manager.

Joyce Chen Foods is tackling that particular obstacle in a different way, putting QR (Quick Response) codes on packages of its new 5-Minute Frozen Potstickers that link smart phone users to a brief instructional video on YouTube.

Chinese New Year is by no means the only time to promote Asian foods. Manufacturers say anytime a particular category is in demand — whether appetizers during the holidays, multi-serve meals at Backto- School or healthy single-serve entrees in January — Asian versions should be promoted as well.

For example, in a recent pre-Super Bowl flyer full of party staples, Trader Joe’s included Pork Shu Mai and Chicken Satay Skewers among other must-have appetizers on its “Trader Joe’s Touchdown Team.”

Considered a “gateway” product for Asian cuisine, appetizers are likely to remain hot in 2011, say manufacturers. Kahiki just rolled out a pair of new Spring Roll Bites, in both Chicken and Buffalo-Style Chicken flavors, as well as a fifth, restaurant-inspired flavor (Sweet Chile) of its Chicken Tempura Nuggets. To take advantage of growing interest in beef-based entrees, it also introduced a family-size package of Beef Mongolian with steamed rice and vegetables, and it added a second packet of sauce to many of its existing meals so consumers can more easily customize flavor.

Day-Lee Foods is also debuting several multi-serve entrees this spring, reports Johns, but like P.F. Chang’s, its new nine-SKU Purely Asian collection includes only meat, vegetables and sauce — no rice or noodles. “Without the starch, it’s a better value for the money,” he explains. “Plus, we think that type of product is more sophisticated, better tasting and closer to Chinese restaurant-quality.”

Competition from Chinese restaurants is also on Phelps’ mind, prompting the recent addition of two popular restaurant dishes to the InnovAsian lineup: Black Pepper Chicken and Caramelized Ginger Pork — the company’s first porkbased entree.

SPICIER TASTES
Astoria, N.Y.-based Water Lilies (www.waterliliesfoods.com) recently enhanced its eggroll flavor profile, as shoppers are more open to spicier tastes, says Peter Lee, president. He stresses that this has been done while keeping the ingredients list short and clean.

Like other vendors, Lee urges retailers to provide a dedicated Asian section: “A full box dedicated to Asian definitely looks better and it grabs the consumer’s attention. Plus, it says ‘We have everything you need, a full selection of Asian products,’” he notes.