The “one armed bandit” brought some good news and some bad news to the ice cream and frozen novelty segment in the past year. The good news? Frozen novelties saw a pretty payout, with dollar sales rising 4.2% to $4,906.3 million during the 52 weeks ending Aug. 11, 2019, according to data from Chicago-based market research firm IRI. Unit sales increased 1.2%.

The bad news? Ice cream failed to hit it big. Dollar sales for the subcategory (excluding frozen yogurt/tofu, ice milk/frozen dairy desserts and sherbet/sorbet/ices) fell 1.4% to $6,063.8 million. Unit sales dropped 1.9%.

Bonus multiplier for indulgence

Indulgence is one “trend” that appears to have traction in the ice cream and frozen novelty space.

“If there is one thing everyone in the world can agree upon, it’s that ice cream is supposed to be indulgent,” George Denman, vice president of sales for Cincinnati-based Graeter’s Inc., pointed out, adding that it is intended to be a treat consumed in moderation.

But with consumers increasingly concerned about the sugar content in their foods, ice cream manufacturers have been introducing lower-sugar products and other formulations deemed as more healthful. Taste, however, remains paramount.

“Consumers are realizing that many of the ‘health halo’ products just don’t meet their needs on taste and are beginning to indulge more responsibly,” said Lindsey Meuser, assistant category manager for Tillamook County Creamery Association, Tillamook, Ore. “This has opened up the door for a lot of products that offer indulgence consumers can feel good about.”

Sometimes “indulging more responsibly” means opting for portion control in the form of a taste-tantalizing frozen novelty. Keith Schroeder, CEO of Marietta, Ga.-based High Road Craft Brands, noted that Europe is providing some inspiration in this space.

“Companies like Sammontana out of Italy are doing fabulously high-quality novelties at very accessible price points,” he said. “In the U.S., the local craft producers are leading the charge with restaurant-quality ice cream sandwiches.”

Meuser pointed to Tillamook’s Chocolate Mudslide ice cream sandwich as a decadent new novelty offering. Sandwiching the company’s Mudslide ice cream with waffle-cone-inspired cookies, the product took first place in the “Most Innovative Ice Cream Novelty” category during the International Dairy Foods Association’s (IDFA) 2019 Innovative Ice Cream Flavor Competition.

And My/Mo Mochi Ice Cream, Los Angeles, also brought product indulgence to the frozen novelty segment with the recent introduction of its triple-layer frozen treats. They feature the company’s traditional mochi dough exterior wrapped around premium ice cream, but also boast a new taste-tantalizing center layer. The line comes in Chocolate Sundae, Vanilla Blueberry, S’mores and Dulce de Leche varieties.

Meanwhile, Nestlé USA Inc., Arlington, Va., aimed to tempt the taste buds of more health-conscious consumers with the introduction of Outshine Half Dipped Bars. Noelle Perillo, manager, brand public relations for Nestlé USA Inc., calls the bars — available in Creamy Coconut, Raspberry and Banana — “really innovative, bringing a little indulgence from 70% cacao dark chocolate in this more traditional refreshing, healthier segment.”

On the ice cream side, the indulgence factor “doubled” with Häagen-Dazs’ (Nestlé USA) introduction of its Spirits Collection earlier this year. The collection offers five spirit-infused ice creams, including Irish Cream Brownie and Bourbon Vanilla Bean Truffle.

According to Perillo, the Häagen-Dazs Spirits Collection plays on “consumers’ desires for unique flavors within ice cream and combines two very indulgent categories.”

Meanwhile, Lotus Bakeries, Lembeke, Belgium, expanded beyond baked goods with its first line of superpremium ice cream. The family-owned company said it developed Lotus Biscoff ice cream by marrying dairy cream with its crunchy Biscoff cookies and its original cookie butter. The ice cream launched in U.S. stores in pints in July 2019 (and in bars in October).

And ice cream’s silky and decadent cousin, gelato, became even more indulgent with the spring release of Talenti Gelato Layers. Talenti, part of Englewood Cliffs, N.J.-based Unilever USA, said the new line of jars features “indulgent, hand-crafted recipes.” Each jar contains five layers consisting of gelato, cookie and/or candy pieces and various sauces. The line comes in seven varieties, including Vanilla Fudge Cookie, Salted Caramel Truffle and Chocolate Cherry Cheesecake.

Jackpot for flavor variety

Variety in terms of flavors also is an ongoing trend.

“Consumers are savvy — they want great-tasting ice cream in fun textures, flavors and forms,” Perillo pointed out.

Matt Thornicroft, assistant marketing and communications manager for Pierre’s Ice Cream Co., Cleveland, said dreaming up new imaginative flavors and products that are reflective of what the company’s fans are seeking is the most exciting part of the business for his company. Some of that flavor imagination can be found in recent additions to Pierre’s ice cream sandwich line. 

The new flavors include Chocolate, Peanut Butter, Sea Salt Caramel and Peppermint — a limited-edition offering for the holidays, Thornicroft said.

“The ice cream sandwich is and will always be a favorite novelty choice,” he noted. “We began thinking about what other ice cream flavors … would pair deliciously with chocolate ice cream sandwich wafers. In addition to offering variety to a popular novelty, they’re ideal portion-control treats and contain 150 calories per sandwich; they make a cool snack.”

For its part, Alden’s Organic, Eugene, Ore., also got creative in the flavors arena, debuting eight new ice cream varieties this past spring. Available in pints, the new flavors include Road Trip Dark Chocolate Almond, Sasquatch Tracks, Caramel Macchiato and Midnight Cherry Chip.

“Ice cream consumers are curious and always looking for new flavors to pique their interest, yet they habitually buy the same core flavors,” Meuser noted. “Tillamook is focused on ensuring we offer the best of the classic products that they purchase all the time while still offering new seasonal flavors to keep them interested.”

Free spins for on-trend formulations

But in the ice cream and frozen novelties space, the trend toward variety means more than an abundance of creative flavors. Today’s consumers want formulations that fit their lifestyles and eating habits, too, Perillo said.

The “hottest fad” here are ketogenic diet-friendly formulations, Denman maintained.

“Leading the growth in keto are brands that offer a low-carb ice cream flavored with monk fruit and [containing] 5 to 8 grams of carbs, replacing sugar as the energy source and introducing healthy fats,” he explained.

Probiotics also boast appeal. In late 2018, Unilever debuted the Culture Republick line of probiotics-containing light ice cream. The brand said it is “on a mission to support culture both inside and out.” It collaborated with emerging artists to design each pint; 10% of the brand’s profits will support the art in local communities. Flavors include Milk & Honey, Turmeric Chai & Cinnamon, Cold Brew & Chocolate Chip, and more.

Perry’s Ice Cream Company Inc., Akron, N.Y., also added probiotics to its lineup with this year’s introduction of Yo Buddies bars. The offerings combine probiotic-packed frozen yogurt with natural fruit and vegetable juices for a healthier take on frozen treats, the company said. The six-packs of single-serve Yo Buddie Bars come in Raspberry Watermelon and Berry Grape flavors.

“Yo Buddies are a convenient, single-serve way for consumers to consume fruit and vegetable juices along with probiotics,” said Marissa Wilson, communications manager for Perry’s Ice Cream.

Pierre’s ventured into probiotics territory, too, with the recent addition of probiotic frozen yogurt pints to its Signature Collection. Products in the line have 130 to 190 calories per serving, Thornicroft said, and are made with the probiotic culture Ganeden BC30. Flavors include Chocolate Chocolate Chunk, Moose Tracks, Sea Salt Caramel Pecan and Vanilla Bean.

The absence of artificial colors, flavors and high-fructose corn syrup also is important to many consumers. And Tillamook’s Dairy Done Right standards don’t allow for any of those ingredients, Meuser said.

“Our Birthday Cake ice cream, released earlier this year to celebrate Tillamook’s 110th birthday, is a great example of a classic flavor done right,” she added.

Don’t gamble on quality

Looking ahead, whether they’re introducing a new flavor, a new format or a new formulation, ice cream and frozen novelty processors do face a few challenges. For one thing, the ability to meet consumers’ desire for quality will continue be critical to ice cream processors’ success, Schroeder suggested. Processors might enhance their efforts here by paying attention to a new subset of consumers.

“We’ve seen a number of hobbyist ice cream influencers who’ve amassed a near-professional level of knowledge about ice cream formulation and manufacturing,” he said. “They’ll leave detailed reviews on product quality and execution, and for the most part, their assessments are accurate. I think it’s incumbent upon us as food-makers, manufacturers and marketers to listen very carefully to what these super-enthusiasts are saying — it’s free feedback.”

And ice cream processors will continue to be challenged in finding ways to minimize the “co-product” — the product-, ingredient- and packaging-related costs and waste, noted Danielle Quist, senior director, regulatory affairs and counsel, IDFA.

“Separated from the final product, the co-product contains nutritious fats and proteins, but the industry trend is to use the co-product for animal feed to avoid the landfill,” she said.

But new research could help here.

“IDFA secured $1.5 million in congressional fiscal-year 2019 funding for USDA’s Agricultural Research Service, bringing hope that researchers can identify novel industrywide applications for the co-product,” she said.