Ice cream is a popular treat. You can grab some at the grocery store or your local specialty provider. Flavors from vanilla to cinnamon to coffee grab the attention of consumers. The end result is that US consumers wind up eating over 1.5 billion gallons of ice cream every year.
Sales of ice cream and frozen desserts rose 2.1 percent to $5.4 billion in the 52 weeks ended August 10, 2014, according to data from IRI. Globally the ice cream industry is worth over $77 billion.
What makes this industry so unique, especially in the United States, is the length of time that manufacturers have been operating. A majority of ice cream and frozen dessert makers have been in the business for a minimum of 50 years, with most of them being family-run companies. Their survival is dependent on being aware of ice cream industry trends like these.
Do We All Still Scream for Ice Cream?
- The average American consumes almost 22 pounds of ice cream per year.
- US ice cream companies made more than 872 million gallons of ice cream in 2014.
- According to IDFA, Summer is the unchallenged season for eating ice cream and other related products. June is the highest production month of the year, but production remains strong through August to satisfy summer demand.
- Vanilla remains the most popular flavor among their consumers according to survey results published by the International Ice Cream Association. About 30% of total ice cream sales involve some form of vanilla flavoring. Chocolate Chip Mint and Cookies and Cream were the next most popular flavors.
- 87% of Americans have some kind of ice cream stored in their freezer at any given time throughout the year.
- Two-thirds of ice cream and frozen dessert manufacturers say that they primarily market their products to local consumers.
- The international market accounts for 10% of the market for US companies.
- Just 16% of ice cream companies market their products at a national level.
- 79.3% of ice cream consumers stated that premium ice cream was their favorite industry product. 10% said that ice cream novelties were their favorite.
- Global sales of ice cream climbed 4% in the last year even though the market itself only expanded by 3%.
- 9% of the milk that is produced in the United States is dedicated to the production of ice cream.
- 10% of people admit that they lick their ice cream bowls clean after they’ve finished their treat.
- 20% of people will also share their ice cream with their pet.
Ice cream is a growing industry that is attracting a lot of attention from around the world. Not only is there a demand for popular flavors, but a want of new products within the industry, like frozen yogurt. This is why China can see an 8% growth within the industry, but US sales are stagnant from 2012-2015. Most US consumers say that they are buying the same products and spending the same amount of money on ice cream. Only non-dairy frozen treats are seeing double-digit increases [45%] in the amount of consumer demand.
How We Think of Ice Cream Today
- In any given two-week period, according to research by NPD Group, 40% of Americans will eat ice cream. That’s almost as many people who drink coffee in the same period of time [47%].
- Although Americans might eat ice cream about 30 times per year, they’re actually eating 45% less ice cream than they did in 1989.
- Over 60% of US households will spend money on ice cream novelties, such as ice cream sandwiches and bars.
- According to IBIS World, one influencing factor on the ice cream industry is the estimated 2,600 frozen yogurt stores that are taking advantage of the health-conscious desires of the typical ice cream consumer.
- Four of the top 10 ice cream novelty desserts are marketed as a health-conscious item.
- Frozen yogurt sales have risen 21% while ice cream sales have stayed level.
- According to Euromonitor, ice cream sales have risen 13% last year in Turkey and 19% in Brazil.
- In Canada, more ice cream is sold in the winter months than in the summer.
- In 2013, Chinese consumers spent an $5.4 billion on ice cream industry products.
- The US still leads the world with ice cream consumption per person. New Zealand comes in second, with Australia coming in a distant third.
- Denmark is the #4 consumer of ice cream per person in the world today, but consumers 3 times less ice cream than Americans do.
- That’s not necessarily surprising since 1 in 5 Americans admits that they regularly eat ice cream in bed. Another 3% eat ice cream while taking a bath.
How an ice cream consumer views ice cream is dependent on their geographic location. In the US, the mature market has seasonal preferences for ice cream, but off-season sales drag down total consumption rates. With 2 out of 3 people reportedly overweight or obese in the US, there is also a health consciousness that is not necessarily present in other locations in the world. Countries like Turkey and Brazil also have different climate structures than the US, which may also lead to increased interest with industry products. It’s probably safe to say that we all want to have some ice cream every now and then, but instead of it being a regular part of the diet, mature market consumers are seeing it more as an indulgence.
What Does This Mean for the Ice Cream Industry?
- More companies involved in the ice cream industry are causing the market to fracture, making it difficult to find shelf space due to the high levels of competition.
- In the US, handcrafted ice cream is increasing in popularity as consumers seek out new options for the times when they want a premium product.
- Consumers are looking for authenticity and individuality when it comes to their ice cream preferences, encouraging local farmers and producers to create and market products to local consumers.
- Ice cream promoting itself as being GMO-free has increased by 35% since 2013, while being hormone-free has increased by 25%.
- Organic and seasonal ice cream claims have seen branding decreases since 2013.
- Consumers claim to be buying less ice cream/treats because they are unhealthy, as opposed to too expensive.
- 1 in 3 ice cream consumers in the US say that the health attributes associated with their product preferences are not important to them.
- Ice cream sold in the United States averages a 16% fat content.
- In the US, 90% of households will eat ice cream at least once over the course of a year.
One of the more interesting ice cream industry trends that is starting to emerge is the “help you help yourself” product strategy that some producers are adopting. Since 2 out of 3 ice cream consumers do think that the health attributes of their product are important, you’re finding ice cream products that include oats, soybeans, and vegetables as key ingredients. There is an increasing number of non-dairy options as well. Smaller portion sizes and even added protein products, like frozen Greek yogurt, are also available.
What the Ice Cream Industry Needs to Know
- The most common reason why a consumer chooses to purchase ice cream is because they found their flavor preference.
- Sweet and salty combinations for ice cream are becoming more common, like using salted vanilla or salted caramel for flavoring.
- Ice cream brands are incorporating everything from bitter fruits and vegetables to cheese and alcohol, creating signature flavors.
- Price is a definite factor and likely why sales are stagnant in the mature US market. Baskin Robbins saw sales drop to $496 million from $570 million from 2009 to 2011. For Cold Stone Creamery, the drop in sales resulted in a controlling interest of the company being put up for auction.
- German Chocolate Cake, Black Raspberry Krunch Sundae and Hawaiian Wedding Cake Ice Cream were named the most innovative ice cream flavors for 2015 at a recent IFDA competition.
- Consumers are showing a strong preference for berry related flavors, especially raspberry.
- The top 4 companies in the ice cream industry generated 68% of the industry revenues in 2015.
Maybe frozen tofu isn’t your thing, but there is a niche market for it. There are also niche markets for gelato, low-fat ice cream, and other specific products that are considered “healthier” than premium high fat ice cream products. Where the competition is originating within this industry is from the small, local shops that are privately owned. These are the places that can cater to specific flavor preferences for their consumers, sometimes even making up a new flavor on the spot, like Black Licorice. If the major manufacturers can jump on with this industry trend, there’s no telling what the amount of sales might be.
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