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While ice cream unit sales are struggling, despite many flavor innovations, frozen puddings and pies have seen promising growth, and frozen yogurt continues to soar.
According to Chicago-based Mintel, the ice cream segment has the largest amount of new product innovation, and remains the largest segment with 54% share of the $11.1 billion total U.S. retail sales of frozen desserts. But despite the innovations, unit sales still struggle. In the 52 weeks ended Oct. 7, 2012, unit sales of ice cream fell 1.1% (to 1.3 billion units), according to SymphonyIRI, a Chicago-based market research firm. (Read more about ice cream’s struggles and successes in our November State of the Industry report.)
On the flip side, other frozen desserts like frozen yogurt, puddings and pies are seeing promising growth. Frozen yogurt, though it has a smaller share in the market compared to ice cream, continues to be a star. In the 52-week-period, unit sales rose 21.2% (to 76.1 million units), according to SymphonyIRI. The frozen pudding and mousse segment, another small player, was the biggest winner among frozen desserts, with unit sales up 162.6% (to 72,109 units) in the same period.
The stagnant economy, which has left many consumers opting to cook at home, seems to be the driving force behind the success of the frozen and refrigerated cakes and pies segment, according to Mintel. That dessert segment grew 12.1% in 2011 and an estimated 10% in 2012, reaching sales of $879 million, according to Mintel. Simply put, frozen desserts are convenient, especially for consumers who do not have the time to prepare both an entrée and a dessert.
Many processors are focusing on this convenience aspect as they look to innovate with portion-controlled frozen dessert options. Larry McFadden, director of Sara Lee Desserts, a unit of Hillshire Brand Co., Downers Grove, Ill., said the company is seeing an increase in popularity for on-the-go desserts and variety.
“Right now, we’re seeing an increase in the popularity of individual desserts with the shift toward more personal snacking among consumers,” McFadden said. This year, the company introduced single-serve, individually wrapped Sara Lee Pound Cake Slices in both original and double chocolate flavors, directly appealing to the portion-control trend.
“More consumers are seeking new dessert flavors and more varieties,” said McFadden. To help meet these preferences, Sara Lee plans to release Sara Lee Cookies & Cream Cheesecake in 2013. “According to consumer surveys, cookies and cream is currently the second most-popular ice cream flavor and its overall popularity continues to rise throughout the frozen desserts category,” he said.
Seeing success with frozen puddings and its individual-size dessert offerings is Galaxy Desserts, Richmond, Calif. Its sales were up 983.2% and units up 1,692.2%, according to SymphonyIRI. Consumers are looking for affordable indulgence and Galaxy has tried to meet those needs with its size offerings, said Paul Levitan, CEO of Galaxy. The company recently introduced two new individual size mousse cakes — The Royale, a 4.3-ounce chocolate mousse with a crème brulee center; and Black Forest Mousse Cake, a 4.7-ounce chocolate mousse infused with cherries, topped with Chantilly cream and chocolate shavings. Both mousse cakes are sold in 24-packs for foodservice and individual pieces at in-store bakeries. According to Levitan, the trend continues to lean toward smaller portions, mini-desserts and natural ingredients.
Flavor innovation is another driving force in frozen dessert success. Processors are exploring indulgent and interesting flavor profiles to grab consumers’ attention.
For Galaxy Desserts, when it comes to flavor, chocolate always seems to win out, said Levitan. But among the standouts for new popular flavors are salted caramel and exotic fruits. “When consumers want a spark, they’ll go for combinations of classics with the unusual,” Levitan said.
Atlanta Cheesecake Co., a division of Panarama Inc., Kennesaw, Ga., recognized the trend in portion control and bite-size options as well, and plans to address that with its 2013 new product releases. But the focus will also be on flavor innovation.
“New and emerging trends include desserts with combinations of textures like cheesecake and cream cake,” said Chris Carpenter, vice president of sales. “Our hottest new item, the Italian Mascarpone Torta, combines mascarpone cheesecake with a baked yellow cream cake, topped with a crunchy streusel. It combines three distinct textures and flavors and has done very well for us.” The Torta is sold in 36- and 54-ounce sizes and is available at retail stores like Costco, Ingles and Harris Teeter. Atlanta also co-packs a line of Biltmore branded gourmet desserts for the Biltmore Estate in Ashville, N.C. The new Torta is also available under the Biltmore brand.
Atlanta also partnered with the chain Mel’s Drive-In, with new offerings of Dutch caramel apple cheesecake and Boston cream cheesecake. According to Carpenter, the three most popular cheesecake flavors for Atlanta are New York-style, Strawberry Swirl and Turtle.
Frozen yogurt continues to trend up thanks to the popularity of Greek offerings and health-conscious consumers. Salt Lake City-based TCBY is riding the wave with a focus on indulgent and comfort flavors. “The influence of cooking shows, chef competitions
and food magazines has made consumers more aware of new flavors and presentations,” said Wayne Geilman, innovations manger at TCBY.
The company recently added limited-time-offerings of pumpkin spice, apple spice and eggnog for the winter holiday season. TCBY will also release a new flavor every month in its franchised stores and will release three new flavors in retail stores where the TCBY pints and scrounds are available.
A few other trends that TCBY is seeing are products with lower-fat, higher-protein and less sugar. Fruit flavors have also shifted away from candy and jam flavors to more fresh fruit formats, said Geilman. The top flavors for the company remain vanilla, chocolate and white chocolate mousse.
Whether it’s seasonal flavors, exotic fruits, cocktail flavors or blended flavors, unique is definitely on the menu in the frozen dessert category, according to ingredient manufacturers.
While there are still many requests for basic frozen dessert flavors, marketing efforts are shifting towards more specific varietals or product types, said Jessica Jones-Dille, associate director of marketing at Wild Flavors, Erlanger, Ky. Examples include Madagascar vanilla bean, dark Dutch chocolate, salted caramel, Fuji apple and Concord grape. Jones-Dille said she is seeing requests for more “full profile” type flavors of a particular product, such as key lime pie, raspberry cheesecake and sweet honey baklava.
“Recently we have been seeing an influx of requests for mocha and latte flavors. Dark-roasted espresso type flavors still are a growing trend,” said Hilary Hursh, senior food applications technologist at Autocrat, Lincoln, R.I. “We also have been seeing interest in fruit and tea combinations and chai tea. Customers have also been requesting extracts that can provide health benefits, such as green coffee extracts and botanicals, as well as, tea and coffee for antioxidants.”
According to Hursh, many of the flavors that have been popular in recent years are still gaining in popularity. For example, superfruits like acai and pomegranate are still in demand due to their health benefits, and it appears that generic flavors are falling out of favor in turn for more unique flavors. The company has also seen requests for other trending flavors like pumpkin and peanut butter being enhanced by adding coffee flavors. When it comes to frozen desserts, people still want indulgence, said Hursh.
In the battle for consumers’ “share of stomach,” do ice cream processors have the stomach for a competitive fight? Ice cream has to watch its back as processors of cheesecakes, puddings, frozen yogurt and other frozen desserts are forging ahead.