Ice Cream: Chasing the clouds away

It may not always be visible in the sky, but the sun is most definitely shining on the ice cream sector. Impulse ice cream sales over the past year grew to more than £110m in the convenience sector, constituting £9m year-on-year growth, according to R&R.

And it’s no surprise when you consider that parts of the UK witnessed record temperatures of above 330C last July.

At Simply Fresh in Faversham, Kent, ice cream sales went through the roof at the height of the season. “We had brilliant ice cream sales last year thanks to the weather and our location opposite the park,” says owner Sandeep Bains. “You’ve got to stay on top of the weather and make sure you have good availability when the sun comes out.”

This mirrors the advice of R&R interim marketing manager Paul Feery. “Sales of ice cream within the convenience sector are more weather dependent, and so retailers need to be on the front foot and react to weather quickly,” he says.

But come rain or shine, retailers are fast waking up to the fact that ice cream is a big opportunity even when the sun hasn’t got his hat on. With suppliers introducing formats for different consumption occasions, you can ensure that your freezer is a hive of activity regardless of the weather.

Sandeep always has a freezer full of goodies by his store entrance. “We locate impulse ice cream at the front of the store. We stock Magnum white, classic, almond and infinity, Cornetto and Cadbury Flake for adults, as well as Mini Milk, Fab, Smarties pop-up and Haribo Push Up for the kids. Magnum is our best seller, and our local Taywells tubs have built up a regular following.”

Sat Deo at Costcutter Wath, Yorkshire, has also seen the benefits of keeping his impulse freezer out all year. “I don’t think most retailers make the most of year-round ice cream sales,” he says. “We sell a full range of ice cream all year. I find it’s worth keeping an impulse freezer out as you get people who like a chocolate-based ice cream treat of an evening and at weekends. Our impulse ice creams are in the Wall’s multideck freezer at the front of the store, near the chocolate and crisps. Magnum classic and white are our best sellers. They still fly out the door even though it’s cold.”

Sunder Sandher, who owns Londis stores in Headington, Oxfordshire and Leamington, Warwickshire says: “I keep Cornetto and Magnums out all year in an impulse freezer by the entrance – you’d be surprised how well they sell in the evenings when people are on their way home from work or college and like to treat themselves.”

The same lines sell well throughout the year at Rosherville Post Office and Stores, Gravesend, Kent. “We have a Wall’s maxi-vision three-layer freezer positioned at an angle where the queue forms,” says owner Harry Goraya, who is a Nisa member. “Cornetto and Magnum are our best impulse sellers.”

And it’s a similar story at Barrie Seymour’s Londis in Liversedge, Yorkshire. “Magnum White is our best seller, and Cadbury’s Flake and strawberry Cornettos are good, too,” he says.

Luxury lines

Indeed, Magnum is the number one ice cream brand in the UK, worth more than £146m with a 14.8% share of the total ice cream category, while Cornetto is the number one filled cone brand, generating more than £44m in value sales in the past 12 months.

To up the ante for 2014, both brands will be sporting new luxury variants. Magnum is celebrating its 25th anniversary with a Marc du Champagne variant (rrp £2.99 for a three-pack and £1.75 for a single), featuring a silver chocolate coating and a holographic wrapper. Meanwhile, Cornetto Premium cheesecake glory (rrp £2.49 for a four-pack and £1.50 for a single) is set to captivate its target audience of 16- to 25-year-olds.

Luxury products are also driving growth in tubs. “Consumer buying trends indicate that sales of indulgent products are in growth within convenience as consumers seek to treat themselves during nights in at home instead of meals out,” claims General Mills channel director Liam Ward. “Luxury ice cream is an area of strong growth within convenience, with Häagen-Dazs driving £1m of the category growth.”

Sat agrees that ultra-premium ice creams are in demand: “We are seeing more premium flavours come through, and companies are making an effort to sound more premium with their product descriptions.”

Sunder concurs that even when times are tough, ice cream brands that portray themselves as luxurious have a certain appeal. “It makes a lot of difference to sales when companies such as Unilever and General Mills do classy adverts for Magnum and Häagen-Dazs,” he says. “Sales of Häagen-Dazs and Ben & Jerry’s are pretty much 50/50 in my store unless they are on deal or on TV, and then people will buy into the brand that is being promoted.”

Clever positioning

Locating ice creams alongside products they might be consumed with can also increase sales, as Barrie has discovered. “We sell small tubs of Ben & Jerry’s ice cream and three-packs of Magnum lollies in a separate freezer in our alcohol section, and they perform really well,” he reveals.

Mars Ice Cream agrees that linking ice cream with complementary products is a sure-fire way to boost sales. “The frozen category is a place where there is great opportunity for cross-category promotions, alongside impulse products,” says Mars Ice Cream senior brand manager James Hay. “One good example is to offer an ice cream and pizza multi-buy promotion from within the freezer to help consumers pair up products for a certain occasion.”

Harry has also seen benefits from selling ice cream as part of a meal deal. But he has noticed that while some consumer groups are happy to pay for premium items, others prefer a more value-driven option. And so he has adapted his ice cream offering to suit everyone. “Last October, we offered a fresh meat dish, a bottle of wine and a Heritage 5ltr tub, or two Cornettos, for £7. Couples tended to go for the Cornettos and families for Heritage,” he says.

Next month, Nisa is adding super-premium 480ml tubs to its Heritage range in cookie dough, chocolate brownie and caramel shortcake  variants, priced at £2.

Value for money

Harry finds that families are drawn to own label over branded ice creams. “Our own-label ice cream sells well with mums. A single Magnum is £1.60 and a triple-pack of own-brand equivalents is £1. We’ll tell parents about it to give them better value.”

Volume sales of Nisa’s ice cream products grew 18.7% last year, due to the new Magnum-style £1 pricemarked Belgian chocolate delight sticks, and Cornetto-style chocolate & nut and strawberry & vanilla cones. This year, Heritage is expanding the range with Belgian white chocolate delight sticks pricemarked at £1, and packs of eight assorted mini chocolate sticks at £2.

Conrad Davies, who owns four Spar stores in North Wales, has also witnessed demand for own label ice cream multipacks. He displays them in his impulse freezer along with branded single ice creams, in order to provide families with more affordable options. “Magnum and Cornetto are still the biggest sellers, but sometimes a family comes in and you see their faces drop when they see how much a Magnum is.

“We are in direct competition with Iceland at our Pwllheli store, so we made a decision to put some of the own-brand multipacks in the lower shelf of the impulse freezer so that families can see there are more value-for-money options.”

Own label tubs are also proving popular at Conrad’s stores. In fact, they perform so well that they outsell branded items. “A couple of years ago we did Ben & Jerry’s at £2 and it went crazy. Now when we do it, it doesn’t have the same impact it used to because the Spar products are such a good price.”

Spar has revealed its new summer range of 480ml ice cream tubs, pricemarked at £2, which is significantly cheaper than its 500ml tubs that carried an rrp of £3.50. Flavours echo those of their branded counterparts, with cookie dough, caramel shortcake, chocolate fudge brownie and strawberry cheesecake all featuring. The group is also launching two new handheld lines. Three-packs of Belgian chocolate ice creams and four-packs of strawberry and vanilla cones are both pricemarked at £1.

The potentially prohibitive cost of branded ice cream has not gone unnoticed by branded suppliers, though. “The feedback from consumers, especially mums, is that they are afraid of finding out the price at the counter and not having enough money on them to pay for the products,” says brand building director for ice cream at Unilever UK & Ireland Noel Clarke. So the firm is introducing 90ml £1 pricemarked Cornetto classico and strawberry variants. “The lower price will align Cornetto classico and strawberry with the cost of other confectionery snacks and drive penetration in the ice cream category,” claims Clarke.

Sunder believes this is the way forward for the impulse ice cream market. “The more pricemarked impulse ice creams we have available, the better. Customers have far more confidence buying pricemarked packs, and if the margins are lower this would be more than made up for in the volume sales increase.”

By ensuring you stock the top-selling brands, plus a selection of value products, you can ensure that everyone’s needs are catered for all year round. “When we have decent weather, it’s a bonus as you sell a hell of a lot of ice cream,” says Sunder. “But you don’t need sunshine to sell ice cream. Even in the winter, people still buy them if you stock the right products.”