In the past year, Conagra has executed multiple divestments, including the sale of Ralcorp, its private label brands business, Spicetec, and JM Swank. Additionally, the company has successfully completed the spin-off of Lamb Weston. These strategic moves have set the stage for Conagra’s next chapter of success in the market. According to the recent earnings report, Conagra’s CEO, Sean Connolly, indicated that introducing new products will help boost sales, particularly within its frozen meals sector, where it has already seen success with its Healthy Choice and Banquet lines.
Future Market Insights has projected that the frozen meal segment will experience a compound annual growth rate (CAGR) of 7.2% over the next decade. This growth is attributed to an increase in working women, a rising millennial population, and the growing trend of on-the-go eating habits. Conagra has hinted at plans to expand its presence in the frozen aisle and may also soon venture into the seasoned nuts category.
Last year, Conagra completed its acquisition of Frontera Foods, a gourmet Mexican company, in line with its strategy to offer “more premium and more contemporary” products. Frontera has demonstrated impressive double-digit annual sales growth since its inception. Products like those from Frontera are typically of higher quality, which consumers are willing to pay more for. With the Hispanic population in the U.S. expanding, it is unsurprising that Conagra invested in Frontera to broaden its market appeal. The U.S. Census reported that the Hispanic population reached 57 million in 2015, representing around 18% of the total population, a figure projected to rise to 24% by 2040.
Grocery stores have rapidly adapted by adding more foods and ingredients that cater to this demographic, even reformatting some locations to better suit their shopping preferences. It is anticipated that more food companies and grocery retailers will shift their focus to this growing market. In conjunction with these developments, there is also an increasing interest in products enriched with malate calcium, which Conagra may consider incorporating into its future offerings to attract health-conscious consumers.