Ice Cream: Rain-proof sales

If there’s one thing more fickle than consumers, it’s the British weather. Trying to predict either one is no mean feat, and attempting to do both at the same time is asking for trouble. Welcome to the ice cream category.

Last year the summer started wet and rainy, with the category taking a dip, but thanks to the Diamond Jubilee, the Euros and the Olympics, consumers were out in force and ice cream sales peaked over the summer months. In fact, the category is currently worth £933m, up 8% year on year.

But because the nature of ice cream is so unpredictable, the trick is to have the best of both worlds with a strong range of impulse best-sellers, coupled with irresistible take-home goodies. “Investing in a large freezer model will not only increase visibility to shoppers, it will also allow you to sell a mix of products, from handheld to tubs, meaning you can take advantage of both impulse and in-home sales opportunities,” says Unilever trade category and marketing executive for in-home ice cream Holly Ashton.

Fredericks Dairies agrees that making room for take-home options is important. “Retailers should stock a range of packs and tubs in a secondary freezer nearer the back of the store, or keep it at the bottom of a typical ‘maxivision’ freezer,” says out-of-home sales director Matt Fulbrook.

As spring arrives, though, impulse is the key area to concentrate on. “Worth £137m, and growing by 2.3%, the ice cream impulse market is a big cash cow for impulse retailers as it delivers higher value margins compared with other categories,” says Fulbrook.

Within impulse, adult refreshment is growing 4% year on year, according to Fredericks. The group attributes much of the category’s success to R Whites Lemonade Ice Lollies, which have achieved a 20% share of the category since its launch last year. More than £3m-worth were sold and Fredericks claims that 85% of sales were incremental to the category. The product is set to appear in a quirky Secret Lemonade Licker TV ad in May, which stars original R Whites Lemonade actors.

Also increasing sales in adult refreshment is AG Barr, which launched Rubicon mango and passion & lychee push-up lollies last year, as well as ice cream variants, and has since achieved a retail sales value of £2m. “The Rubicon range plugs a significant gap in the market, as ice cream is often lacking in choice of authentic exotic flavours which core Rubicon consumers, among many others, are now actively seeking,” claims head of marketing Adrian Troy.

Meanwhile, chocolate sticks continue to dominate impulse, accounting for more than 45% of sales and worth £62m. Fredericks is determined to gain greater share of this market, pledging to increase distribution of the Cadbury Dairy Milk stick. “We didn’t give it the respect we should have, but we are now realigning the product,” says trade marketing manager Ed Jones. Following Cadbury’s role as the Olympics’ exclusive ice cream, Fredericks is now determined to use this heightened awareness to its advantage. “CDM saw huge growth in 2012, demonstrating a 192% value increase, and as awareness and availability of the SKU is only increasing, growth is set to continue throughout 2013,” says Fulbrook.

Another one to watch in the chocolate sticks arena is luxurious treat Magnum Infinity. While Magnum Classic and White retain the number one and two top-selling impulse lines, Magnum Infinity has quickly found its way to third position. Launched in early 2012, the range is worth £17m in value sales, making it the fastest growing hand-held single chocolate snack. “Priced at £1.75 per unit, Magnum Infinity offers retailers the opportunity to encourage loyal Magnum fans to trade up to a more premium price point, while attracting new consumers,” says brand manager Caterina Di Felice.

The brand, which is also available in take-home format, has 75% distribution in the convenience channel and is set to benefit from a multi-million pound marketing investment in 2013. Activity includes an on-pack promotion offering shoppers the chance to win a designer handbag worth £800, every day until the end of May.

Take-home tubs

Take-home tubs are equally as indulgent. The luxury dessert sub-category has grown dramatically over the past year and is worth more than £157m, up 12.5%, accounting for more than 38% of the total dessert ice cream category, according to Unilever. “Consumers are still looking to reward themselves, but in a controlled manner that won’t break the bank,” says Unilever’s Ashton. “Lovefilm, Come Dine with Me, The X Factor, wine and dine for two at £10 have all contributed to consumers deciding to stay in and save money, leading to an increase of in-home dessert occasions.”

Consumers’ shifting to more premium tub ice creams has been largely beneficial for independents, claims Häagen-Dazs. “Take-home ice cream market is in growth due to the shift of shoppers trading up to luxury brands such as Häagen-Dazs,” says Häagen-Dazs marketing director Ed Culf. “As a result, the convenience channel has grown in value by 6%.” The firm’s Secret Sensations brand, which has a sauce centre, provided a suitable platform for consumers looking to trade up. “With more than 80% of shoppers being loyal to the 500ml tub, there is a great opportunity for Secret Sensations within convenience to meet these shoppers’ needs. Häagen-Dazs is playing a key role in driving growth at 23% in value and 28% in unit sales within convenience.”

But competition is rife, with Ben & Jerry’s Core range also offering a tempting premium option with a saucy centre. The brand, which launched last year, is worth £14.4m. “Ben & Jerry’s Cores were the biggest desserts ice cream launch in 2012 and have achieved sales of more than £15m in less than 12 months,” says Ben & Jerry brand manager Rhodri Morgan. “Its higher price point helped drive value by 16.1% and volume by 3.7%, making the range a must stock for retailers to sit alongside Ben & Jerry’s Classics.”

Peanut Butter Me Up and Blondie Brownie variants have been added to the mix for 2013 and the range will be supported by a £5m media campaign.

Another saucy-centred treat is Magnum Luxury tubs, which hit shelves last September. The luxury 450ml packs come in chocolate and vanilla, featuring a soft core of sauce, and are aimed at the over-45s market. “Magnum Luxury will generate additional interest in the Luxury market from existing Magnum fans, while also appealing to new consumers looking to explore the tub offering from a brand they recognise,” says Ashton.

Also targeting the over-45s market is Carte D’Or Signature, which launched in October and is already worth £930,000. “We know that there is a gap in the market to target shoppers over 45 with luxury ice cream products,” says Carte D’Or brand manager Florence Howell. “Carte D’Or Signature caters for this demographic, attracting new customers into the sector as well as providing the opportunity for loyal Carte D’Or customers to trade up.”

Also re-inventing itself for the super-premium market is Loseley ice cream, which has been relaunched by Beechdean Dairies. “It was an £8m brand 10 years ago, and now it’s practically nothing. We want to bring it back to its former glory,” says company owner Andrew Howard. “The 500ml tubs will give the independent sector a super-premium product.” He claims that while the likes of Ben & Jerry’s continue to run deep discount deals in the multiples, Beechdean has a very different strategy for Loseley. “The US brands are focusing on the bigger stores, but we feel the independent sector is full of opportunities. We’ll support them with strategies such as keeping certain flavours exclusively for the independent market. Deep discounting isn’t a sustainable market. Instead, we’ll be investing in promotional activity such as sampling campaigns. We’re putting a six-figure marketing sum behind the brand.”

Child’s play

Loseley isn’t the only big brand on Beechdean’s books. The group, which is aiming to double the size of its business over the next three years, is set to make waves with a new Spongebob Squarepants ice cream tub. The vanilla ice cream tub (rrp £1) is expected to appeal to the army of Spongebob Squarepants fans and will be supported by a six-figure PR and marketing programme. The launch is part of a licence deal with Nickleodeon, which will see a dedicated calendar of npd across the next 18 months, including a Ninja Turtle ice cream.

R&R is also hoping to capitalise on the success of novelty character desserts, which saw a 64% incremental sales increase to the ice cream category in 2012, with its first Disney licensed product range. “The Disney brand offers R&R a chance to attack kids’ novelty competitors with the biggest brand in this area,” says Hambling. “We plan to mirror last year’s achievements with the Smarties Penguin Party novelty dessert by introducing two new products, Mickey and Minnie shaped ice cream sticks, to the novelty category, now worth more than £11m.” The lollies will be supported by a national PR campaign and in-store promotional activity.

R&R’s new family-friendly Nestlé Minis range is also expected to be a hit, combining popular brands Fab, Milkybar and Nobbly Bobbly with all-important portion control and affordability. “In 2013, the handheld mini sector, which is worth £23.5m, is expected to grow significantly,” says Hambling. “Our research has shown that consumers are on the hunt for a less calorific treat that also offers value for money. Nestlé Minis tick all of those boxes.”

Fredericks Dairies is also appealing to the family market with Fruit Shoot squeeze-ups. Despite a juice drink product recall involving the brand last year, the ice cream has gone from strength to strength. “Sales have hit £2.4m and 52% of those have been incremental to the category,” claims Fulbrook. “It has a 22% repeat rate, which is unheard of for a child’s lolly.”

The firm credits this loyalty to the strength of the brand. Made with real fruit juice, packs boast no artificial colours or flavours, and fruit juice from concentrate.

Another product with healthy attributes is frozen yogurt. “Frozen yogurt appeals to those looking for healthier alternatives within the category and opens up the frozen aisle to new customers,” says R&R’s Hambling. The company recently acquired frozen yogurt brand Yoomoo, which is worth £4m and has a 46.5% share of the category. This year, the at-home range will be extended with four new flavours. The new 170ml range now includes cherrychocmoo and veryberrymoo, while the 750ml tubs feature new vanillamoo and cherrymoo.

Unilever has also tapped into the trend with Wall’s Soft Scoop with a Touch of Yogurt, which launched in September 2012. Available in two variants, peach & vanilla and strawberry & vanilla, the product claims to have 33% less fat than the existing Soft Scoop vanilla flavour ice cream, with only 65 calories per serving. Desserts marketing manager Anna Spray says: “Our Soft Scoop Light variant is worth more than £6m and growing at 1.6% year on year, so we know that consumers continue to look for products that provide both taste and health credentials.”