TORONTO, May 22, 2015 /CNW/ -- Even as Canadians
become more aware of how eating habits affect their health, pizza
remains a staple of their diets. According to a new report from
Mintel, three quarters (74 percent) of Canadian adults ate frozen
pizza in the six months preceding 2015 and 81 percent ate
restaurant or take-out pizza during the same time period. Despite
its popularity, volume and dollar sales of pizza have declined
notably over the past five years.
"Aggressive pricing strategies, increased health concerns,
competition from foodservice, where Canadian Millennials perceive
pizza to be of better quality, as well as disinterest from the
ageing population have all led to declining sales," said
Joel Gregoire, Senior Food and Drink
Analyst at Mintel. "Mintel forecasts predict a return to positive
volume growth. However, competitive pricing pressures will force a
continued drop in dollar sales."
Taste and price outweigh health concerns
There are
many variables Canada's pizza
consumers take into account when making a purchase decision.
However, 34 percent rank price ahead of brand as a deciding factor.
When considering what type of pizza to purchase, nearly as many
consumers (31 percent) say they are consistent in their pizza
purchase. When deciding between frozen or refrigerated pizza
offerings, preferred toppings ranks among the top five reasons for
selecting a pizza with 84 percent of consumers listing this
attribute. When asked what their top consideration is, preferred
toppings wins out yet again with 35 percent. Rounding out the
second and third choice attributes cited as most important are
crust thickness (72 percent) and size (72 percent).
Canadians acknowledge that their overall health depends on
eating well, but purchasing factors that relate to health such as
caloric content (32 percent), being all-natural/organic (27
percent) and having whole grain crust (25 percent) ranked
substantially lower in customers' purchasing consideration set.
However, three in 10 Canadian consumers (31 percent) agree that
store-bought pizza is a relatively healthy option. While over half
of Canadian adults (54 percent) are identified as overweight or
obese, only 32 percent of frozen or refrigerated pizza eaters cite
lower-fat or -calorie pizzas as being among their top five
considerations when choosing one option over another.
"Canadians demand more selection from frozen and refrigerated
pizzas, and they're also interested in more healthful options. At
the same time, the basics of toppings and crust remain most
important to consumers when choosing one pizza over another,"
continued Gregoire. "As such, manufacturers must strike an artful
balance in delivering on innovation and health without diluting the
product Canadians have grown to love and expect from their favorite
pizza brands."
Pizza is tossed out by an ageing population
As age
increases, frozen pizza purchases decline. Only 56 percent of
Canadians aged 65+ report eating frozen pizza, well below the
average of 74 percent. Furthermore, this demographic is expecting
growth of 19 percent by 2019, which places further financial risk
on the faltering frozen pizza market. According to Mintel data,
Canadian consumers over 65 may be disinterested in pizzas because
of their different pizza-eating habits. This group features an
increased likelihood of adding their own toppings before heating up
their pizza (44 percent) and a desire for fewer but better quality
toppings (43 percent).
"The 26 percent of Canadians who do not eat frozen pizza skew
older and are less likely to have children at home. Pizza
consumption starts to fall amongst those age 45-54 and continues to
decline thereafter," Gregoire continued. "When children are not
present in the home, the share of consumers who do not eat frozen
pizza nearly doubles to 31 percent."
Millennials' love/hate relationship with pizza
While
younger consumers drive volume sales of frozen pizza, they
contribute to the pricing pressures that are decreasing revenue.
For consumers aged 18-24, price is even more likely to be a factor
when purchasing frozen pizza (45 percent vs 34 percent overall). To
accommodate this key purchasing group, retailers are forced to
reduce the cost of their products so they will stand up to
competitive market prices, leading to decreased dollar sales.
Canadian consumers under 25 show more interest in buying
single-serve (31 percent) and microwavable options (30 percent) at
retail locations. Additionally, they are more likely to agree that
individual frozen or refrigerated pizza is a good option for lunch
and/or school, but primarily prefer takeout and delivery with 40
percent eating it two times or more per month.
Gregoire concluded, "Younger consumers, particularly
Millennials, are the driving force behind the pizza category while
simultaneously acting as the source of current market pricing
pressures. Millennials show the highest penetration of pizza
consumption and are the most fervent foodservice customers with 40
percent eating takeout at least twice a month. However, the fact
that under a third of consumers aged 18-24 are eating frozen pizza
(32 percent) is indicative of the current sales trend in the
store-bought pizza market."
About Mintel
Mintel is the world's leading market
intelligence agency. For over 40 years, Mintel's expert analysis of
the highest quality data and market research has directly impacted
on client success. With offices in London, Chicago, Belfast, Kuala
Lumpur, Mumbai,
Munich, New York, Sao Paolo, Shanghai, Singapore, Sydney, Tokyo
and Toronto, Mintel has forged a
unique reputation as a world-renowned business brand. For more
information on Mintel, please visit www.mintel.com.
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SOURCE Mintel