Mintel: Ice cream market hitting stride
CHICAGO — The ice cream market has emerged from struggling sales, posting a 4.1% increase in retail sales to $10.7 billion, and is expected to grow an additional 4% this year, according to Mintel.
New product development will play a large role in the continued success of the ice cream market in the coming years, Mintel food and drink analyst John Frank said, adding that new flavor profiles and ingredients, better-for-you products and new packaging concepts will be instrumental in its success. Mintel's research also found that when buying ice cream or other frozen novelties, 94% of survey respondents said they base their decision on flavor, while 83% said they look at price and 72% look for a sale or promotion. When it comes to brand loyalty, more than two-thirds (68%) of respondents make their selections based on brand alone.
"Aside from the flavor of frozen treats, price is the key factor in a consumer's decision on what to purchase," Frank said. "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."
Besides price and promotions, Mintel said reduced fat (38%), reduced sugar (38%) and reduced calorie (36%), are the most important claims consumers are looking for on the packaging of their favorite frozen treat. However, gluten-free and dairy-free products are rapidly growing in popularity with 14% and 15% of Mintel respondents, respectively, saying they are "very or somewhat important" to them. Size also matters: 69% of survey respondents who buy frozen treats — especially those ages 18 to 24 years (74%) who are the most likely to eat it away from the home directly after purchasing it from the grocery or convenience store — said portion size is important.
Mintel also said that one segment getting a lot of attention in the U.S. market is Greek yogurt. The popularity of Greek yogurt is spilling over into the ice cream and frozen novelty market and prompted total U.S. retail sales of frozen yogurt to jump 9.7% from 2011 to 2012. It also demonstrated the highest growth percentage of the four ice cream and frozen novelty segments, Mintel noted.