New Research Shows Ice Cream Market Heating Up
CHICAGO -- Americans' love affair with ice cream is heating up. Retail sales of ice cream and frozen novelties increased 4.1 percent in 2011 to reach $10.7 billion, and the market is poised for an additional 4 percent growth this year, according to market research company Mintel.
"Aside from the flavor of frozen treats, price is the key factor in a consumer's decision on what to purchase," said John N. Frank, a food and drink analyst at Mintel. "Price is more important than brand, quality and health information, which makes it difficult for brands to break away from a price promotion strategy, but does give private label products a major opportunity for growth."
When buying ice cream or other frozen novelties, 94 percent of people say they base their decision on flavor, while 83 percent look at price and 72 percent look for a sale or promotion. When it comes to brand loyalty, slightly more than two-thirds (68 percent) of respondents make their selections based on brand alone.
According to Frank, new product development will play a large role in the continued success of the ice cream market in the coming years. New flavor profiles and ingredients, better-for-you products and new packaging concepts will be instrumental in the segment's success.
The popularity of Greek yogurt spilling over into the ice cream and frozen novelty market could be one reason that total U.S. retail sales of frozen yogurt were up 9.7 percent from 2011 to 2012 -- the highest growth percentage of the four ice cream and frozen novelty segments.
Not surprisingly, reduced fat (38 percent), reduced sugar (38 percent) and reduced calorie (36 percent) are the most important claims consumers are looking for when purchasing ice cream. However, gluten-free and dairy-free products are rapidly growing in popularity with 14 percent and 15 percent of Mintel respondents, respectively, saying those claims are "very or somewhat important" to them.
Container, or serving size, is important to 69 percent of survey respondents who buy frozen treats, and especially so among those aged 18 to 24 (74 percent) who are the most likely to eat it away from the home directly after purchasing it from the grocery or convenience store. Portion control containers would also fare well with those concerned with "low-in" claims, according to Mintel.