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First Post
23-04-2025
- Business
- First Post
In crust we trust: Why frozen pizzas are flying off shelves in the US
In recent weeks, frozen pizza sales in the US have seen a huge surge, and some experts suggest that this shift may indicate changing consumer habits. As the stock market shows signs of instability and tariffs continue to create economic pressure, many shoppers are on the lookout for early signs of a downturn. With growing concern over inflation and possible job losses, more people are opting to stay in and enjoy a frozen pizza rather than dining out read more In recent weeks, frozen pizza sales have jumped sharply in the US. Pixabay/Representational Image More people in the United States are buying frozen pizzas, particularly the higher-end ones. In recent weeks, sales have jumped sharply, a trend that some experts say could reflect changing habits among shoppers. Though the growing interest in frozen food is not entirely new, it is gaining attention once again. Even before the Covid-19 pandemic, the average American was eating nearly 40 pounds of pizza each year. ALSO READ | Americans are hoarding Korean sunscreen and beauty products. Here's why STORY CONTINUES BELOW THIS AD So, why are people now turning more to frozen options, especially pizza? We explain what is behind this shift and why frozen pizza has become such a popular choice. Why frozen pizzas are flying off shelves in US The spike in frozen pizza sales in the US is not just about taste or convenience. It may also reflect how people are responding to economic pressures. With the stock market showing signs of instability and tariffs adding to the pressure, many consumers are looking out for early signs of a downturn. Alongside more common indicators like weaker job markets or reduced spending, experts point out subtle lifestyle changes, like buying more lipstick or smaller bottles of alcohol, as hints that people are feeling financial strain. One unexpected sign: a growing preference for frozen pizza, especially the premium varieties. Frozen pizzas are seen inside the Walworth County Food Pantry in Wisconsin, US, Reuters/File Photo Craig Zawada, chief visionary officer at Pros Holdings, a pricing strategy firm, told Business Insider, 'This happens every sort of downturn in the economy — there's increased demand for premium frozen pizzas, high-priced frozen pizzas.' He explained that people are choosing to stay in and enjoy a quality frozen pizza instead of going out to eat. As concerns about the economy rise again, many shoppers are opting to eat at home and stock up from the frozen aisle. This trend points to a shift in behaviour, influenced by inflation and continuing global uncertainty. STORY CONTINUES BELOW THIS AD In 2024, the US frozen pizza industry brought in $6.5 billion in revenue, according to IBISWorld, which was still much higher than before the pandemic. For households watching their spending, a £10 frozen pizza can feel like an affordable treat. Food industry analyst Phil Lempert told Business Insider that frozen pizzas also stand out in shops. 'Because of the amount of different pizza brands that are out there, I would say that every week when I look at store circulars, there's at least one pizza on sale,' he said. Meanwhile, data from the US Census Bureau showed that retail sales in February rose by just 0.2%, falling short of forecasts, after January's figures were revised down to a 1.2% drop. The weak results have led many to wonder whether consumer demand is actually fading or simply shifting in new ways. Why this is not a new trend This is not the first time frozen pizzas have seen a rise in popularity during tough times. Whenever people feel financially stretched or simply unsettled, they often find comfort in the frozen food aisle. STORY CONTINUES BELOW THIS AD In 2024, the US frozen pizza industry brought in $6.5 billion in revenue. Pixabay/Representational Image In fact, sales saw noticeable increases during both the 2009 recession and the Covid-19 pandemic in 2020. During the height of the Great Recession in 2009, frozen food sales rose by 3.1%. When the pandemic struck in 2020, frozen pizza sales jumped by nearly $1 billion compared to the previous year, rising from $5.8 billion in 2019 to $6.6 billion, according to data from IBISWorld. Inflation and ongoing economic uncertainty continue to influence more home-focused habits, and this pattern is far from new. Alexander Chafetz, an investment banker who works in the consumer sector, told Business Insider, 'Frozen pizza has always been a good category.' He added that frozen pizza stood out during the pandemic when many people were out of work, money was tight, and families needed an affordable way to put food on the table in the evening.
Hindustan Times
23-04-2025
- Business
- Hindustan Times
The frozen pizza indicator: Why a surge in sales hints at looming recession in US
Consumers in the United States are increasingly turning to comfort foods, including frozen pizza, which is a trend some experts believe is a potential indicator of shifting consumer behaviour amid growing economic uncertainty. Frozen pizza sales experienced a significant surge in recent weeks, with consumers reaching for especially the premium option amid economic unease, Business Insider reported. The same pattern was noted during previous economic downturns. Craig Zawada, the Chief Visionary Officer at Pros Holdings, a price optimization firm, noted that even though consumers choosing high-priced frozen pizzas during a downturn may seem paradoxical, it is actually a trade-off as they end up substituting dining out with eating at home. 'This happens every sort of downturn in the economy,' Zawada said. The sale of frozen foods, especially frozen pizza, rose significantly during the 2009 recession and the 2020 pandemic. In fact, the US frozen pizza industry generated $6.5 billion in annual revenue last year, and remains well above its pre-pandemic level, market research firm IBISWorld found. This trend, where people prefer eating at home and stocking up from the grocery, is often prompted by economic anxiety. Factors like inflation and ongoing global uncertainty often lead to home-centric consumer behaviour, and this is not a new phenomenon. A year before the Covid-19 pandemic, the average person consumed about 40 pounds of pizza. The trend was amplified by the pandemic. Meanwhile, according to recent data, US retail sales increased only slightly in February, raising concerns about consumer strength as it fell short of expectations. Data released by the U.S. Census Bureau in March showed that the retail sales figure showed a 0.2% monthly growth in February, after a downwardly revised 1.2% drop in January. The headline figure actually missed economist estimates of 0.6%. A closer look at the data left economists and consumers wondering if consumer demand is cooling, or just shifting. 'The unfavorable surprise on U.S. headline retail sales—monthly growth of 0.2% compared to the consensus forecast of 0.6%—was not reflected in the other numbers in this data release,' said Mohamed El-Erian, chief economic advisor at Allianz, according to Bezinga.
Business Insider
21-04-2025
- Business
- Business Insider
The Pepperoni Price Index
Are you craving a frozen pizza lately? You're not alone. Maybe it's because the weather's warmer, maybe you're jonesing for a lazy-day treat, or maybe it's because the stock market's down and tariffs are throwing everything into chaos. The uncertainty in the economy has people on the hunt for recession indicators — not just potential labor market weakness or spending pullbacks, but also more specific signals that suggest dark times are nigh. Consumers on edge, for example, buy more lipstick as a still-affordable luxury, or they start to scoop up smaller bottles of liquor. Another peculiar sign they're feeling pinched by the economy: They buy more frozen pizza, specifically, the fancy kind. "This happens every sort of downturn in the economy — there's increased demand for premium frozen pizzas, high-priced frozen pizzas," said Craig Zawada, the chief visionary officer at Pros Holdings, a price optimization company. It's a bit counterintuitive, he added, since you'd think consumers are more cost-conscious, but it's actually a trade that makes sense because "they're replacing eating out to having a good frozen pizza at home." So next time you find yourself lingering in the frozen section, know that your hankering for DiGiorno might be due to a case of economic anxiety. When people are feeling pinched — economically, existentially — they turn to the grocery store frozen section. In 2009, in the midst of the Great Recession, frozen food sales grew by 3.1%. When the pandemic hit, frozen pizza sales spiked by nearly $1 billion from the year before, from $5.8 billion in revenue in 2019 to $6.6 billion in revenue in 2020, per the market research firm IBISWorld. "Frozen pizza has always been a good category," Alexander Chafetz, an investment banker who does dealmaking in the consumer space, said. "But it came into focus, I would say, during the pandemic, when people weren't working, money was tight, and you had to feed a family at night. Frozen pizza is a very economical way to feed your family." Michael Ryan, the owner of Tree Tavern Pizza, a frozen pizza company that operates out of New Jersey, told me that during the pandemic, his sales "went through the roof." He said that pizza as a category does well during downturns, but frozen has the extra "convenience" factor. "It is in the freezer, ready to heat. No tipping the delivery person or cold, soggy pizza," he said. Right now, with everything that's going on in the country and in the world, people are very nervous, so we're going to gravitate toward more comfort foods. Although growth has since slowed from the breakneck COVID-driven pace, people are still buying up more frozen pizzas, thanks in large part to inflation. The US frozen pizza industry generated $6.5 billion in annual revenue in 2024, per IBISWorld, and remains well above its pre-pandemic level. Tighter budgets still make that $10 frozen pie seem pretty appealing. While there's a growing amount of competition in the frozen food aisle at the grocery store, frozen pizza is still a star player, said Phil Lempert, a food industry analyst and the editor of The boxes take up a lot of space, and they're relatively attractive to display. They're also convenient for stores to offer promotions and discounts on "because of the amount of different pizza brands that are out there, I would say that every week when I look at store circulars, there's at least one pizza on sale," Lempert said. "These companies are always vying to give promotions to the retailer." Pizza is a comfort food that people tend to crave in trying times such as these. "Right now, with everything that's going on in the country and in the world, people are very nervous, so we're going to gravitate toward more comfort foods, whether it's mac and cheese, whether it's hot dogs, whether it's pizza," Lempert said. Mid-conversation, I realized I might be doing some accidental coping via comfort food lately, as I've made pizza (homemade, which was terrible) and mac and cheese (luckily, from the box) in the past few weeks, neither of which are in my normal rotation. It also probably helps frozen pizza's case that the quality has improved dramatically in recent years, and there are a lot more varieties on offer. You've got healthier options, with cauliflower crusts, for example, or you can indulge (slightly) with premium ingredients like hot honey, prosciutto, or basil. Restaurant brands have launched their own frozen offerings so people can get something that tastes like the out-to-eat experience at home. Ryan pointed out that home freezers have also gotten bigger, which makes it easier to stock up. Now, as that good old economic anxiety is stirring up once again, people are leaning toward eating at home and stocking up from the grocery store frozen aisle. David Portalatin, a senior vice president and food industry advisor at Circana, a market research firm, said that over the past year or so, consumers have been opting to buy a greater share of their meals at retail establishments — meaning grocery stores, clubs, online — than from food-service operations, such as restaurants. "That's just a reflection of several things," he said. "One is a little bit of response to inflation and the fact that food inflation away from home is still accelerating faster than at home. But it's also this sort of longer-term trend of a more home-centric consumer." When the pandemic took hold, many people had to stay home. Once the pandemic subsided, they were excited to get back out there and go to the restaurants they had eschewed for months. But that stay-at-home muscle is still stronger than it was pre-pandemic. More people are working from home, where it's easy to whip something up in their own kitchens — Ryan said that while it may seem silly, "the fact that many folks never got out of their pajamas helped spur sales." Consumers have also grown more accustomed to having fun nights in — turns out all that practice in 2020 means they've gotten better at at-home entertainment. Consumers become more price sensitive as they opt for cheaper, family-size offerings, like pizza. "People seem to be more comfortable at home. They want to do their own drinking at home," Chafetz said. "People are happy being at home, nesting. I think people nest when they're nervous, and so I think there's a lot of that going on also." "Empirical evidence suggests consumers often 'trade down' to frozen or delivered pizza during recessions. Consumers become more price sensitive as they opt for cheaper, family-size offerings, like pizza," Alex Fasciano, an analyst at CFRA Research, said in an email. He noted that pizza restaurants' marketing is anchored around value, too, such as Domino's recently launched appeal to more budget-conscious consumers: the "Emergency Pizza" promotion (a free pizza) and "Best Deal Ever" promotion (a $9.99 deal). But again, it's not necessarily just any old traded-down item people are buying as they start to worry about where the economy is headed, frozen pizza or otherwise; it's the nicer stuff. It's reflective of this overarching attitude among American consumers that we still want to treat ourselves, even as we cut back in other areas. Many people buckle down on their budgets somewhat, but they also spring for treats, whether it be a fancy latte, a weekend getaway, or a frozen pizza they tell themselves is healthy, which, maybe, don't look too too hard at the ingredients. "In general, over the last year, we've seen the headwind at restaurants and the tailwind at making meals at home because they're more affordable. Yet there are all kinds of examples where we will choose the more premium offerings," Portalatin said. "When we go to retail, we may not be choosing the lowest price point offering, recognizing that we're already saving money by cooking at home." Consumers have been battening down the hatches for a while now. Heightened concerns around tariffs have led to an acute sense of dread among many Americans about prices, economic stability, and even the safety of their own jobs. It's the type of mix that might make that stay-at-home Red Baron extra enticing. William Curtis, a senior research analyst at IBISWorld, said they're not forecasting an economic-freak-out-induced spike in frozen pizza sales like the ones in 2009 or 2020, in part because it's not clear what will happen in the overall economy. But in the event that things really start to go south, "the logic of buying the frozen pizza when you have less money would still hold," he said. Curtis added that frozen pizza is facing more competition for consumer dollars than it did 15 years ago, with more frozen options available, not to mention the proliferation of delivery services that make it possible to get all kinds of foods dropped off right to your door. Obviously, cooking at home is still cheaper, especially when you account for all the fees and the tip, but many consumers are still doing some slight splurging. "There are a lot of consumers that are willing to pay these fees just for the convenience of delivery," he said. Ryan, from Tree Tavern, said he's not really concerned about competition from delivery or restaurants, because he sees frozen as its own thing. His customers are loyal, and he's focused on quality and authenticity that he hopes will appeal to people in good times and bad. He only sells plain cheese pizza, which helps keep the price stable and gives customers the opportunity to dress the pizza up however they like. "I kid with people who ask me why I don't offer more toppings," he said. "I jokingly say, 'Buy your own damn pepperoni!'" If the economy takes a turn for the worse, customers may stick with just the cheese.
