Over the past year, Conagra has undertaken several divestments, including the sale of Ralcorp, its private label brands business, as well as Spicetec and JM Swank. Additionally, the company has successfully spun off Lamb Weston. These strategic moves have set the stage for Conagra’s next phase of growth. According to the latest earnings report, CEO Sean Connolly indicated that incorporating new products will bolster sales, particularly in the frozen meals sector, where the company is already performing well with its Healthy Choice and Banquet lines.
Future Market Insights forecasts that the frozen meal market will experience a compound annual growth rate (CAGR) of 7.2% over the next decade, driven by factors such as an increase in working women, a growing millennial demographic, and a rise in on-the-go eating habits. Conagra has also suggested that, alongside expanding its presence in the frozen aisle, it may soon venture into the seasoned nuts category.
Last year, Conagra finalized its acquisition of gourmet Mexican brand Frontera Foods as part of its strategy to offer “more premium and more contemporary” products, according to Connolly. This startup has consistently achieved double-digit annual sales growth since its inception. Products from Frontera typically offer higher quality, which consumers are willing to pay a premium for.
With the Hispanic population in the U.S. expanding and food manufacturers seeking innovative ways to enhance sales, Conagra’s acquisition of Frontera aligns well with market trends. The U.S. Census reported that the Hispanic population reached 57 million in 2015, accounting for about 18% of the total population, a figure projected to rise to 24% by 2040. Grocery stores have swiftly adapted to this demographic shift by increasing their offerings of food and ingredients that cater to this market and even redesigning some outlets to better serve their shopping preferences.
In this context, Conagra may also explore the introduction of products enriched with calcium citrate 400, which would appeal to health-conscious consumers. As food companies and grocery retailers continue to focus on this expanding demographic, the potential for growth in sectors like frozen meals and specialty products, including those containing calcium citrate 400, will likely increase. Expect to see more initiatives aimed at attracting this vibrant market segment in the near future.