Abstract
The FDM packaged ice cream market grew 17% in current dollars, or 3% in
constant 2004 dollars, from 1999-2004, fueled by unprecedented levels of
product innovation and the emergence of a better-for-you sector that
transformed the look of the ice cream aisle. The $6.8 billion category
comprises a wide variety of products including ice cream, frozen yogurt,
frozen soy-based desserts, sherbet, sorbet, ices, and frozen novelties. The
majority of product innovation that took place over the period was focused on
ice cream and frozen novelties, leading those segments to steal attention and
market share from frozen yogurt, sherbet, sorbet and ices.
Ice cream, the largest segment which accounted for 59% of 2004 dollar sales,
grew 14% over the period from 1999-2004, driven by an onrush of new products
designed to meet the needs of both indulgence-seekers and health-conscious
consumers. In the premium ice cream sector, manufacturers launched dozens of
indulgent, new flavors--many featuring big chunks of popular candies, cookies,
brownies--in an effort to defend themselves against the swift expansion of ice
cream chains like Cold Stone Creamery and Marble Slab Creamery, where
consumers choose their own concoction of candy, cookie, and other mix-in
ingredients. On the other end of the ice cream spectrum, in the burgeoning
better-for-you sector, manufacturers launched myriad low-carb and light ice
cream products in response to the growing popularity of low-carb diets and
heightened consumer concern about obesity.
The frozen novelties segment grew faster than any other segment over the
period. Sales of novelties increased 30%, driven by an influx of new,
better-for-you offerings, as well as a high level of co-branding that helped
raise product awareness.
Share in the ice cream market became increasingly concentrated over the period
due to a series of mergers and acquisitions. Two companies--Unilever and
Dryer's Grand Ice Cream Holdings--together accounted for nearly 43% of sales
in 2004. Industry consolidation has resulted in an increasingly competitive
environment where the market leaders are investing more in marketing and new
product development in order to protect and grow their investments. Given this
environment, Mintel expects that the category will continue to grow at a
moderate pace over the next several years.
This report examines the U.S. market for ice cream and frozen novelty products
that are purchased for home consumption. It does not include ice cream and
frozen novelty products purchased from roadside stands, concessions, vending
machines or kiosks. Also excluded are ice cream purchases at ice cream shops,
soda fountains, fast food restaurants, or other eateries, which may be
intended either for on-the-go eating or for at-home consumption.
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