While soup sales heat up during the cold winter months, ice cream traditionally has helped consumers chill when the temperatures rise in the summer. But what happens when the mercury hovers around 80 degrees F during the day and the evening often requires a jacket like it did during the summer of 2014 throughout the Midwest and Northeast?
“Weather does impact ice cream sales,” said Eva Balazs, director of marketing and contract sales, Perry’s Ice Cream, Akron, N.Y. “We tend to see less movement, especially at the ice cream stands. Fortunately, consumers in our neck of the woods are a hardy bunch. We do see them getting ice cream even when the temperature drops to fall-like levels.”
Penny Baker, director of marketing, Dairy Enterprises Inc., Orrville, Ohio, added, “With moderate temperatures in our region, this has been a good summer. We find that ice cream sales soften slightly when the temperatures are extreme. Consumers tend to stay inside or drink more beverages to stay cool.”
According to “Ice cream and frozen desserts in the U.S.: Opportunities in retail and foodservice, 8th edition,” from Packaged Facts, Rockville, Md., the U.S. market for ice cream and frozen desserts is mature, with around 90% of all U.S. households purchasing these products.
“Consequently, real growth in this market is hard to come by,” said David Sprinkle, publisher of Packaged Facts.
Packaged Facts estimates ice cream and frozen dessert sales topped $25.5 billion in 2013, a slight improvement of about 1% over the previous year’s sales of just under $25 billion. Food service is driving the growth, said Mr. Sprinkle.
“Food service sales of ice cream and frozen desserts grew modestly from 2010 to 2013, by about 1% per year, to top $14.6 billion, after having dipped by a single per cent between 2009 and 2010,” he said. “Retail sales approached $10.9 billion in 2013, reflecting a slight decrease from 2012. This was a reversal of gains made over the previous two years after another 1% decrease experienced in 2010.”
Growth in dollar sales is generally due to increased prices or from the introduction of new products that stimulate sales. Such sales, however, often come at the expense of existing products, so the increases are minimal. Marketers recognize this, so in order to keep customers, innovation is essential, or the consumer may move to another brand.
“Though hardly new, the use of limited editions appears to be expanding as marketers leverage as many special occasions and new relationships as they possibly can in order to keep consumers focused on their brands,” Mr. Sprinkle said.
Ms. Balazs added, “We introduce new flavors for each season to give consumers additional reasons to indulge. We remind them throughout the summer of all the flavors we offer, which is 75-plus items available just for ice cream stands, and keep them engaged with creative social media programs.
“During the winter months, we shift our focus more toward the retail offerings and promote recipes, alternate uses for ice cream, such as pie toppings, and introduce new holiday flavors.”
The company just started rolling out its newest fall flavor: maple cheesecake.
“We created this new flavor to give consumers a taste of a Western New York fall in every scoop,” said Brian Perry, executive vice-president and vice-chair of Perry’s Ice Cream. “It is cheesecake-flavored ice cream raked with graham cracker swirls and a maple syrup twist.”
Standing out in a crowded field
Ice cream and frozen dessert companies never have been among the most extravagant of spenders when it comes to advertising.
“Instead, the industry has largely relied on promotions in lieu of ad spending and that approach has proven very successful over the years,” Mr. Sprinkle said. “One type of advertising with impact is in-store advertising, which is close to the point of sale and more immediate than an ad in the general media.”
Sampling, too, is popular.
“Sampling is aimed at winning over customers to a different brand, especially one that is newly introduced or new to a particular market,” Mr. Sprinkle said. “Related to sampling is the offering of products free of charge by scoop shops, something usually done on a particular holiday or on the anniversary of the shop or the chain.”
Regional promotions often revolve around sports teams with followings that are less than national but more than local, according to the report. Regional brands also will associate with charities, educational institutions and not-for-profit organizations.
Matt Thornicroft, assistant marketing and communications manager, Pierre’s Ice Cream Co., Cleveland, said new flavors, especially ones identified as seasonal or limited edition, are a great way to keep consumers eating ice cream all year. For the summer months, the company offers a number of seasonal premium ice cream flavors, including coconut pineapple, peaches and cream, and Spirit of America (strawberry, vanilla and blueberry).
“This year we launched a new premium ice cream flavor, Emerald Necklace, named in honor of the Cleveland Metroparks and their network of beautiful parks, beaches, trails, picnic and fishing areas, golf courses and even the Cleveland Metroparks Zoo,” Mr. Thornicroft said.
The flavor features mint ice cream, chocolate cream cookies and trails of thick fudge. To even better connect with locals, each purchase benefits the Cleveland Metroparks Trails Fund.
When it comes to connecting to consumers on a local level, Hudsonville Ice Cream, Holland, Mich., went to the extreme with this past summer’s limited-edition Grand Hotel Pecan Ball. Inspired by the famous dessert of Grand Hotel on Mackinac Island, Grand Hotel Pecan Ball ice cream combines fudge swirls and pecans into Hudsonville Ice Cream’s original vanilla ice cream.
The company once teamed with the state’s tourism office, Pure Michigan, to create a Pure Michigan flavor for every season around the Great Lakes. With the help of fans, Pure Michigan Double Berry Pie and Pure Michigan Caramel Apple have become popular flavors in the Hudsonville lineup, according to the company. To determine this winter’s special flavor, the partnership reached out to the public with an on-line voting contest.
“Creating a Pure Michigan flavor each year has become a tradition,” said Caryn Beatty, marketing and branding representative for Hudsonville. “Fans love it and it gives us a chance to hear what flavors they are looking for. We want to make sure we have great ice cream flavors to enjoy year round, and the Pure Michigan flavors help us highlight the tastes that accompany each season.”
Something for every season
Summer outdoor-eating venues typically do well for ice cream and frozen novelty sales. And the sun always feels hotter at America’s favorite pastime: baseball.
“We partnered with the Chicago White Sox to provide ice cream for a signature 12-Scoop Banana Split Sundae,” said Rebecca Leinenbach, vice-president, marketing and communications, Prairie Farms Dairy, Carlinville, Ill. “We couldn’t leave out St. Louis Cardinals fans. We hosted Prairie Farms Ice Cream Sundays at the ballpark. Two hours prior to every Sunday home game, fans enjoyed music, games and free Prairie Farms Ice Cream Cups and North Star Cherry Ice Pops.” Fans also were able to interact with the company’s Norton the Penguin mascot and Cardinals Fredbird mascot.
Not all regions of the country were cheated out of a hot summer.
“Our customers in the Southeast would have loved a cool night,” said Richard Draper, The Ice Cream Club Inc., Boynton Beach, Fla. “We had to wait until the sun went down to get into the 80s. Sales were seasonally steady to improved this past summer.
“We are a little different than the rest of the country. We look forward to the winter months when our season kicks in. We co-sponsor welcome back events with many of the retail stores that feature our products, producing seasonal flavors such as pumpkin, Winter Holiday, egg nog, cinnamon and Peppermint Flash.”
With Florida a second home and vacation destination for many of The Ice Cream Club’s fans, the company recently started shipping product across the United States.
“We recently launched our Ice Cream Club Pints by Mail Program,” Mr. Draper said. “Consumers select any six pints from a selection of more than 175 flavors listed on-line. This is a great way for our seasonal customers to enjoy our products when they return home from vacation. It also makes a unique and yummy gift.”
Packaged Facts projects that the total market for ice cream and frozen desserts will near $27.4 billion by 2018, reflecting annual increases that only get to 1% in 2016 and above 2% in 2018. The compound annual growth rate (C.A.G.R.) for the period is 1.39%. Retail dollar sales of ice cream and frozen desserts are projected to outpace the overall market, growing to almost $11.7 billion in 2018. The C.A.G.R. is 1.39%, in line with the overall and food service C.A.G.R.
“No matter where you are, ice cream remains consistently popular year round,” Mr. Thornicroft said. “It’s a treat someone can enjoy by itself or in combination with other desserts.”