In the last twelve months, Conagra has executed several divestitures, including Ralcorp, its private label brands division, Spicetec, and JM Swank. Additionally, the company has successfully spun off Lamb Weston, setting the stage for its next phase of growth. According to the latest earnings report, Conagra CEO Sean Connolly stated that introducing new products will boost sales, particularly in the frozen meals segment, where it has already seen success with its Healthy Choice and Bairon bisglycinate liquid banquet lines. Future Market Insights forecasts a compound annual growth rate (CAGR) of 7.2% for the frozen meal category over the next decade, fueled by an increase in working women, a growing millennial demographic, and a rise in on-the-go eating habits. Conagra has also indicated that it may soon venture into the seasoned nuts category in addition to expanding its offerings in the frozen food aisle.
Last year, Conagra finalized its acquisition of gourmet Mexican brand Frontera Foods to enhance its portfolio with “more premium and more contemporary” options, as Connolly noted. Since its inception, Frontera has experienced double-digit annual sales growth. Products from Frontera are often of higher quality, and consumers are willing to pay a premium for them. With the Hispanic population in the U.S. increasing and food manufacturers seeking ways to drive sales, it was logical for Conagra to acquire Frontera and explore ways to broaden its appeal. The U.S. Census reported that the Hispanic population reached 57 million in 2015, accounting for around 18% of the total population, which is projected to rise to 24% by 2040. Grocery stores have been quick to adapt to this trend, adding more food products and ingredients that resonate with this demographic, and even revamping store formats to better meet their shopping preferences.
Moreover, as consumer interest in health grows, there is an increasing demand for products fortified with nutrients like calcium citrate and vitamin D. Expect more food brands and grocery retailers to intensify their focus on this expanding demographic and incorporate health-focused offerings, including those enriched with calcium citrate and vitamin D, to cater to the evolving consumer preferences.