Analyst Insight by Lianne van den Bos - Food Analyst
Maturity, health-conscious consumers and a decline in product launches have all contributed to a slowdown in ice cream sales in saturated markets such as the US and the UK. However, whilst Unilever and Nestlé dominate overall sales of ice cream, with a combined global value share of 35%, a somewhat controversial revolution is brewing in the background, targeting the ultimate indulgent experience. Will hemp-infused ice cream and alcoholic popsicles pioneer the wave of craft ice cream? Euromonitor International takes a closer look at the rise of craft ice cream and how Unilever and Nestlé should take pointers from two university graduate entrepreneurs.
Retail ice cream sales in the US posted a 1% decline in 2013 compared to historic average growth of 2%, primarily due to a drop in product innovation, consumers switching to healthier products outside ice cream, such as Greek yoghurt or fruit, or opting for cheaper formats. The UK paints a somewhat different picture; growth has also slowed down, but still registered a 5% value increase in 2013, compared to 7% in 2012.
New Product Launches in Craft Ice Cream
While major manufacturers have been busy trying to launch healthy ice cream formats or jumping on the Greek yoghurt bandwagon, a new wave of entrepreneurs are instead focusing on flavour, excitement and, above all, provocative product innovation. Hemp-infused ice cream by Relaxation Solutions, a subsidiary of Bebida Beverage Company (BeBevCo), is expected to be launched in the US by August this year. The company is partnering up with 80s comedy duo Cheech and Chong to be the face of this ‘’relaxation’’ ice cream, which claims to contain 5mg of hemp per half pint serving. With some states in the US having already legalised recreational marijuana use and more to follow this year, it’s quite the catchy product launch of 2014.