Here's the Scoop

January 23, 2008
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No matter the season or temperature outside, private label ice cream and frozen novelties have incredible potential to be hot (make that cool) commodities.

We’ve all done it: stealthily removed the half-gallon tub of cookie dough ice cream from the freezer and used a teaspoon (a tablespoon, if you want to confess honestly) to scrape a mouthful or two of the creamy deliciousness from the perimeter of the bucket. Replacing the container behind a bag of freezer-burnt peas, careful to hide our sin of gluttony from unsuspecting others, we relish in our small sin of indulgence. Later when we return to commit the crime a second time, we quickly learn we are not alone. Ice cream and other frozen goodies have an uncanny way of disappearing from our freezers!

The same disappearing act is true of grocers’ freezers across the country, which isn’t surprising as Americans consume the most ice cream in the world per capita. On average, each person eats more than 23 quarts of ice cream annually. It seems we all really do scream for ice cream!

Melting the Myths

Why worry about ice cream in November? Ice cream and other frozen novelties are summer foods, right? Well, sort of. While Ronald Regan dubbed July National Ice Cream Month in 1984, there is good reason to keep an eye on the ice cream and frozen novelty segment the entire year. Simply stated, people don’t buy just ice cream. They buy a cone’s worth of comfort. They buy a chilled childhood memory-on-a-stick. They buy a simple pleasure that just happens to oftentimes be drizzled with hot fudge. And, when appropriately advertised and merchandised, these commodities sell year-round.

(Ice) Cream of the Crop

According to a 52-week data collection from Chicago-based Information Resources Inc. (IRI), ending July 15, 2007, sales of ice cream and frozen novelties have been overwhelmingly strong across the segment. Particularly noticeable is the increase in private label cheesecakes and frozen pies.

“Cheesecake products are an indulgent treat for people,” says Dave Edelstein, director of sales for Mister Cookie Face, Lakewood, N.J. “The ‘comfort food’ craze is stronger than ever. With a rise in in-house entertaining and increased upscale product offerings, more people are turning to the frozen aisle than the fresh-baked [products].”

The trend toward upscale frozen desserts is hardly mystifying. Consumers crave both the flavorful richness and quick convenience of frozen treats. Rich, smooth and super premium do not only describe the delicacies people consume, but also their desired lifestyles.

“Quality is absolutely key,” says Michael Brown, senior project manager of Perry’s Ice Cream, Akron, N.Y. “The bar is high for private label products - they must be smooth and creamy to succeed, not icy.”

Brian Perry, Perry’s Ice Cream executive vice president, takes Brown’s view on quality one step further. “New technologies exist that would enable us to finish the ice cream-making process in about 30 seconds,” he says. “But instead we choose to spend 30 minutes to achieve the velvety texture and creamy taste.”

Efficiency is important, but effectiveness is critical. Private label products have long been associated with low prices. While this is admirable, it would be ideal if the spotlight were more on value than the actual cost per unit.

“The quality should be based on ingredients and more upscale offerings. Cheap has always been the focus rather than quality,” Edelstein notes. “Some retailers are realizing that quality and reliability are just as important as price.”

Perry, Brown and Edelstein all make a valid point. While consumers are pocketbook-savvy, they are ultimately driven by their taste buds - superior-quality products win out every time. If retailers continue to bring their game to private label, they are certain to enjoy perpetuated advancing sales.

Having Your Ice Cream, and Eating It Too

While private label cheesecakes and similar products are doing well, IRI data reveals significant sales slumps in private label frozen whip toppings, puddings and mousses. This observation seems to contradict the growing popularity of upscale ice cream and frozen novelty products. After all, what is more lavish than adding a dollop of whipped cream to an already decadent dessert?

As if decadence weren’t enough, it appears consumers want the indulgence of ice cream without the guilt.

“Whips and mousses may be down due to consumers being more health conscious,” Edelstein suggests. “Fewer people are adding calorie-added toppings to foods.”

Brown vouches for the better-for-you products, too. “Light ice cream continues to grow at a rapid rate and is an area private label is expanding into,” he says. “[The segment] should experience strong growth if the quality is comparable to the branded lights.”

Brown also asserts that the organic segment of the category, while still small, holds strong growth potential as well. IRI data confirms this theory with evidence of increased sales of private label tofu and yogurt products, as well as natural ice creams, sherbets and sorbets.

Accessible Edibles

Ice cream was long revered as an exotic delicacy available primarily in the royal courts of Europe. It wasn’t until the mid 1800s that ice cream products became popular in the United States, and even then it was consumed chiefly among the elite. It’s been casually documented that during the summer of 1870, President George Washington ordered $200 worth of ice cream products - that’s the equivalent of $96,400 today!

While blowing wads of cash on ice cream may have been of little consequence to the presidents of yesteryear, the average consumer today is a bit more savvy and pennywise. Certainly consumers crave quality and healthfulness. Indeed these attributes contribute mightily to the value of private label ice cream and frozen novelty products. But ultimately, value is tied in with price. Customers expect private label products to be priced lower than their branded counterparts.

“What draws the consumer is the idea that their retailer is offering an equal or better product that is backed by a higher standard than what the store offers, and delivered at a fair price,” Edelstein says.

So how can retailers ensure that consumers develop a taste for private label products? Perry’s Brown says the key is sampling. Getting the products into consumers’ mouths leads to getting products into their freezers.

“In-store sampling is a great way for retailers to get consumers to try a product risk-free,” Brown says. “If the product delivers, consumers will come back.”

Brown also suggests coupling sampling with couponing for maximum sales appeal. After all, what’s better than supplying a free taste of delicious ice cream to customers, convincing them to buy, and then giving them some of their cash back?

Edelstein offers another tip for retailers to help spread the message about their private label products. “Retailers should make an all-in commitment to their brand,” he says. “A wide assortment of products should be featured together in mass with quality upscale artwork and package design.”

Taste is key - but how will you know what a product tastes like if you never try it? The private label brand and image is important in making the initial product introduction.

Sweet Satisfaction for the Masses

Store owners know best what merchandising methods will capture the attention and palates of their regular customers, and often they have the power to select appropriate product offerings. While ice cream and frozen novelties are popular nationwide, retailers make it their business to know their audiences.

“While your core flavors sell everywhere, there are distinct regional differences,” Brown says. “Coffee sells well in New England, but not so great in the Atlantic states. Another is peanut butter ice creams - we can’t make enough of them in Western New York, but they’re so-so in the rest of the country.”

“Ultimately you have to ask the retailer which side it wants to be on. They control their stores and determine what goes on the shelf,” Edelstein says. “Owners have to avoid the quick fix, big-money monopoly companies bring to the table. The quick fix often results in a downward spiral with someone else determining what the consumer wants. What sells in New York doesn’t always sell in Iowa.”

The most successful retailers carry a wide variety of high-quality products. While branded products fit the bill, the value-focused products will discover a comparable (or many times even better alternative) in private label.

Ice cream and frozen novelties enjoy steady sales with products that come in a variety of flavors, textures, shapes and sizes. Whether snarfing down a classic vanilla nutty cone or savoring a new indulgent piece of cake bar, you can rest assured that retailers strive daily to have private label compete with branded counterparts. Trends indicate that they’re doing a good job, too.

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