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Ice Cream - US - April 2017

OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY 
Positive growth seen in 2016 and forecast through 2021
Figure 1: Total US retail sales and fan forecast of frozen novelties, at current prices, 2011-21
The issues
Obesity is high and traditional ice cream is seen as high fat, sugar and calorie
Figure 2: Perceptions of Frozen treats in terms of calories, sugar, and fat, February 2017
Frozen yogurt and sherbet/sorbet/ices struggle, fail to grow sales
Figure 3: Total US retail sales and forecast of frozen yogurt/non-dairy and sherbet/sorbet/ices, at current prices, 2011-21
In 2016, volume sales are still well below level seen in 2012
Figure 4: MULO volume sales of frozen treats, by millions of units, 2011-16
The opportunities
High engagement from younger consumers, parents, and Hispanics
Figure 5: purchasing of ice cream and frozen yogurt, by type and select demographics, December 2016
Many opportunities for usage and promotion of ice cream and treats
Figure 6: Reasons for Frozen treat purchase, for iGeneration, Millennials, and parents, February 2017
Cultivating loyalty, expanding reach
Figure 7: Purchase drivers, for iGeneration and millennials, February 2017
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Positive growth seen in 2016, with sales reaching $12.8 billion
Opportunities in premium, healthier fare and with demographic focus
In-store usage strong, competition still present from many sides
MARKET SIZE AND FORECAST
Positive growth seen in 2016 and forecast through 2021
Figure 8: Total US retail sales and fan forecast of ice cream and frozen novelties, at current prices, 2011-21
Figure 9: Total US retail sales and forecast of frozen novelties, at current prices, 2011-21
MARKET BREAKDOWN
Together ice cream and frozen novelties comprise 96% of sales
Figure 10: Market share of ice cream and frozen novelties, 2016
Figure 11: Total US retail sales of ice cream and frozen novelties, by segment, at current prices, 2014 and 2016
Gelato sales fall in 2016, but are likely to stabilize
Figure 12: Total retail sales of gelato and gelato-based novelties, at current prices, 2011-16
The forecast for frozen yogurt and sherbet/sorbet remains poor
Figure 13: Total US retail sales and forecast of ice cream and frozen novelties, by segment, at current prices, 2011-21
Volume sales decline in all segments at MULO
Figure 14: MULO volume sales of frozen treats, by millions of units, 2011-16
From 2015-16, volume increase highest in ice cream/frozen dairy dessert
Figure 15: MULO volume sales of frozen treats, by segment, by millions of units/packages, 2015 and 2016
MARKET PERSPECTIVE
In-store purchase outpaces foodservice
Figure 16: frozen treat purchase, by location of purchase, February 2017
Ice cream shops can lead perception of premium, support brands
Figure 17: Ben & Jerry’s cereal flashback, March 2017
Other treats can compete with – or complement – frozen treats
Non-frozen yogurt offers sweet, dairy-based treat, with healthy profile
Frozen blended coffeehouse drinks are popular with young generations
MARKET FACTORS 
Obesity epidemic may dampen ice cream sales, boost call for healthier treats
Parents, who will be more racially diverse, also key to market
Figure 18: frozen treat purchase, by parental status, February 2017
Figure 19: frozen treat purchase, by Hispanic origin, February 2017
Figure 20: Population by race and Hispanic origin, 2012-22
Figure 21: Hispanic share of population, by generation, 2017
KEY PLAYERS – WHAT YOU NEED TO KNOW 
Two leading suppliers lose share in diversified supply landscape
Ben & Jerry’s, Talenti & Häagen-Dazs stand out in ice cream segment
Premium frozen novelties with grown-up appeal perform well
Frozen yogurt and sherbets/sorbets/ices segments struggle
Key trends are natural ingredients, nutritious treats, small servings
COMPANY AND BRAND SALES OF ICE CREAM AND FROZEN NOVELTIES
Four leading suppliers command about half of the market
Private label struggles, while “other” companies build sales and share
Sales of ice cream and frozen novelties by company
Figure 22: Sales of ice cream and frozen novelties, by company, rolling 52 weeks, 2015 and 2016
WHAT’S WORKING?
Indulgent ice cream with high quality, natural ingredients performs well
Ben & Jerry’s and Talenti perform well, boost sales for Unilever
Ben & Jerry’s: social activism…and mix-in super indulgence
Figure 23: Ben & Jerry’s Join the Climate Movement ad, July 2016
Talenti Gelato’s message of indulgence, quality ingredients and lower fat resonate
Häagen-Dazs, messaging purity + pleasure shines for Nestlé’s premium brand
Figure 24: MULO sales of ice cream, by leading companies and brands, rolling 52 weeks 2015 and 2016
Frozen novelties’ sales growth slow, but some standout successes
Unilever's Magnum is stand-out success with double-dip bars
Figure 25: magnum double caramel, ad, may 2016
Figure 26: Magnum double ice cream with Kendall Jenner ad, may 2016
Other indulgent and candy-centered treats outperform the segment
Figure 27: MULO sales of frozen novelties, by leading companies and brands, rolling 52 weeks 2015 and 2016
WHAT’S STRUGGLING?
Frozen yogurt struggles, one or two bright spots
Figure 28: MULO sales of frozen yogurt, by leading companies and brands, rolling 52 weeks 2015 and 2016
MULO sales fall for sherbet, sorbet and ices, a few make gains
Figure 29: MULO sales sherbet, sorbet and ices, by leading companies and brands, rolling 52 weeks 2015 and 2016
WHAT’S NEXT?
The expansion of premium offerings with natural, simpler formulations
Seasonal, coffee, or tea inspired, and unusual flavors
More nutritious, probiotic, protein, and vitamin enriched offerings
For small suppliers, original flavors tie to TV shows, sports teams, icons
Nostalgic tastes and kid-friendly, candy and cake inspired offerings
Smaller sizes, including bite-sized confectionary-inspired treats
THE CONSUMER – WHAT YOU NEED TO KNOW 
Ice cream is the most widely purchased, followed by frozen novelties
Satisfying a craving and snacking drives consumption
Most engaged consumers seek range of formats and brands
Consumers seek favorite flavors, want indulgence over healthfulness
Health and safety concerns unlikely to thwart consumption.
Dairy-based ice cream and frozen novelties enjoy positive associations
FROZEN TREAT PURCHASE 
Ice cream is top purchase, with frozen novelties in second
Figure 30: Frozen treat purchase, by type of treat and where eaten, February 2017
Younger generations relish treats beyond basic ice cream
Figure 31: In-store frozen treat purchase, by generation, February 2017
Kids love frozen treats…and parents, understandably, buy more!
Figure 32: In-store frozen treat purchase, by parental status, February 2017
Figure 33: Type of in-store frozen treat purchase, by parental status February 2017
Hispanics are key consumers, buying wide range of frozen treats
Figure 34: In-store frozen treat purchase, by Hispanic origin, February 2017
Figure 35: Type of in-store frozen treat purchase, by Hispanic origin, February 2017
REASONS FOR PURCHASE
Satisfying sweet cravings and snacking drive purchases
Figure 36: Reasons for frozen treat purchase, February 2017
Younger generations eat frozen treats to satisfy craving or snack
Figure 37: Reasons for frozen treat purchase, Part I, by generation, February 2017
Younger consumers find a range of secondary reasons to indulge
Figure 38: Reasons for frozen treat purchase, Part II, by generation, February 2017
A wide range of reasons propel parents to buy frozen treats
Figure 39: Reasons for frozen treat purchase, by parental status, February 2017
Hispanics above all seek frozen treats to satisfy carving or as snack
Figure 40: Reasons for Frozen treat purchase, by Hispanic origin, February 2017
FROZEN TREAT FORMATS
Half-gallon packages lead, but smaller formats still widely used
Figure 41: Packaging size for frozen treat purchases, February 2017
Single-flavor products most popular, followed by mix-ins
Figure 42: Flavors and product qualities, February 2017
Younger buyers use smaller packages, more varied and indulgent treats
Figure 43: Packaging size for frozen treat purchases, by generation, February 2017
Figure 44: Flavors and product qualities, by generation, February 2017
Parents seek variety packs and use gamut of brands
Figure 45: Reasons for frozen treat purchase, February 2017
Expanding packaging options builds accessibility
Figure 46: TURF Analysis – Frozen treat formats, February 2017
Figure 47: Table - TURF Analysis – Frozen treat formats, February 2017
PURCHASE DRIVERS
Favorite flavor is the top driver, though value also shapes choices
Figure 48: Purchase drivers, February 2017
For consumers of all ages, favorite flavor is a central driver
Figure 49: Purchase drivers, part i, by generations, February 2017
Millennials are more likely to seek new flavors and premium brands
Figure 50: Purchase drivers, part ii, by generations, February 2017
Parents seek new flavors, premium offerings, and more natural ingredients
Figure 51: purchase drivers, by parental status, February 2017
Household income shapes importance of price, sales, and brand quality
Figure 52: purchase drivers, by household income, February 2017
ATTITUDES TOWARDS FROZEN TREATS
A third eat treats weekly; national brands widely seen as better tasting
Figure 53: Attitudes related to consumption level and brand, February 2017
Safety or health concerns rarely drive down consumption
Figure 54: Attitudes related to health and safety, February 2017
Younger consumers less likely to let health concerns limit consumption
Figure 55: Select attitudes towards frozen treats, by generation, February 2017
Despite greater safety concerns, parents stock, buy and eat more treats
Figure 56: Reasons for frozen treat purchase, by parental status, February 2017
PERCEPTIONS OF FROZEN TREATS
Dairy-based ice cream viewed as indulgent, but delicious and satisfying
Figure 57: Correspondence Analysis – Perceptions of frozen treats, February 2017
Figure 58: Perceptions of frozen treats, February 2017
iGeneration posts positive perceptions of treats beyond ice cream
Figure 59: Perceptions of ice cream, by generation, February 2017
Figure 60: Perceptions of frozen novelties, by generation, February 2017
Figure 61: Perceptions of frozen yogurt, by generation, February 2017
Figure 62: Perceptions of non-dairy frozen dessert, by generation, February 2017
Parents see range of treats beyond novelty items as appropriate for kids
Figure 63: Perceptions of which products are for kids and adults, by parental status, February 2017
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Sales data
Fan chart forecast
Consumer survey data
TURF methodology
Correspondence analysis methodology
Abbreviations and terms
Abbreviations
APPENDIX – MARKET 
Figure 64: Total US sales and forecast of ice cream and frozen novelties, at inflation-adjusted prices, 2011-21
Figure 65: Total US sales and forecast of ice cream and frozen desserts, at current prices, 2011-21
Figure 66: Total US sales and forecast of ice cream and frozen desserts, at inflation-adjusted prices, 2011-21
Figure 67: Total US sales and forecast of frozen novelties, at current  prices, 2011-21
Figure 68: Total US sales and forecast of frozen novelties, at inflation-adjusted prices, 2011-21
Figure 69: Total US sales and forecast of frozen yogurt/non-dairy, at current prices, 2011-21
Figure 70: Total US sales and forecast of frozen yogurt/non-dairy, at inflation-adjusted prices, 2011-21
Figure 71: Total US sales and forecast of sherbet, sorbet and ices, at current prices, 2011-21
Figure 72: Total US sales and forecast of sherbet, sorbet and ices, at inflation-adjusted prices, 2011-21
Figure 73: Total US retail sales of ice cream and frozen novelties,, by retail channel, at current prices, 2010-20
Figure 74: Average household size, by race and Hispanic origin, 2016
Figure 75: Distribution of generations by race and Hispanic origin, 2017
Figure 76: Median household income, by race and Hispanic origin of householder, 2015

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