The sun shone on ice cream sales last year. Sunshine is recorded in hours and according to the Met Office there was an average of 1,503 hours of sunshine in the UK in 2006, 12% above the average, with the South faring slightly better than the North.
Although this still doesn't quite match up to that great summer of 2003, with its 1,587 hours of sunshine and the sunniest year this century, last year was still a good year for ice cream sales. While sales in the total ice cream market grew 3.9% on 2005, handheld singles grew by 5.8% over the same period (Walls/IRI 2006).
Walls category operations manager impulse Al Wilson says: "Convenience is disproportionately hit by good weather and it definitely played a part."
However, this isn't the end of the story: "You don't want to forget the new products and an increase in feet on the street. I don't think weather drives all the numbers."
Fredericks sales and marketing director David Taylor agrees: "Last June and July were good, but people forget that August was rubbish." And Richmond Ice Cream marketing manager Claire McIntosh says
it doesn't necessarily have to be warm to drive consumers to the category: "It's almost like the temperature doesn't matter - if the sun shines people will buy, even in February."
Of course, a variable such as the weather can give a distorted picture of the market when figures are compared year on year - the stunning figures for an unusually sunny 2003 made the following years look extremely bad, even though they had an average amount of sunshine. What is clear is that another good year can only add to what many in the industry believe is a change in fortunes for the market, or at the very least a bottoming out of the decline. And with strong npd, things can only get better.
Says McIntosh: "There was strong npd in the market last year and you only need a couple of factors like that and the weather to get a good start. If you look at the npd this year, you've got every reason to suspect it'll be a good year."
Most of Richmond's npd at the moment is in tubs and multipacks, however impulse npd is expected a bit later in the year. And as most retailers will tell you - npd is key to handheld sales. Says Fredericks' Taylor: "Innovation is key to this market - more than any other I've worked in - it's so important. People like their favourites, but will always want to buy something new."
Walls' Wilson agrees: "If you examine category turnover, new products account for about 10% of the whole category, which is high if you look at a convenience footprint."
One of the main thrusts of the Walls campaign this year is not only encouraging consumers to buy the new stuff, but also to buy more often. According to Walls brand building director Di Houldsworth: "Pretty much everyone in the UK is buying ice cream once a year. The issue we've got is frequency. For a lot of consumers ice cream still remains in a limited occasion. Unless we expand those occasions, we can't expect the market to grow."
The second problem, says Houldsworth, is the consumer's health perception of ice cream -
that it's a 'forbidden pleasure'. This year's marketing and npd is, she says, trying to tackle these issues and includes an extension of the Walls red heart on pos to reflect the new brand vision of 'A good honest scoop of everyday pleasure' and incorporating the themes of 'Love Milk', 'Love Fruit', 'Love Chocolate' and 'Love Ice cream'.
In-home packs are also changing to highlight food values of the ranges, with GDAs on most of the range. Cabinets, too, will carry new livery, also highlighting the food values. Says Houldsworth: "This is the most radical approach we've taken to the category. This is a really big battle we need to win."
In a bid to create more ice cream occasions, and to change the health perception of ice cream, the company is targeting mums with its Milk Time range. Walls brand manager Nikki French says that the approach to kids' products will be to place an emphasis on balance and fun, aiming at the afternoon snacking occasion.
The range, which is available mainly in multipacks at present, highlights the fact that the products contain as much calcium as a glass of milk and have no artificial colourings or flavours. The range will also encompass Mini Milk, which will carry new packaging. Variants will remain the same.
The range will be supported by TV advertising in May as well as radio, press, PR and web presence.
Also in the children's range, although aimed at fun rather than health, is the new Simpsons Sour Fizz (rrp 50p). It's a lemon and pineapple ice lolly with sour fizzy sweet inclusions. The launch is timed to coincide with The Simpsons film, out this summer.
In refreshment, the Solero brand was up in volume last year, but down in value, according to Walls, and this year the company is upgrading the core brand with a focus on fruit values and emphasis on its 99 calorie content.
New to the range is Solero Smoothie with variants strawberry & banana and blackcurrant & banana, each with 99 calories. Other changes include a 99 calorie Solero Exotic with the outer coating made from 40% fruit. An outdoor campaign will support the brand in June and July. The Solero range has a rrp of 90p (three-packs, £1.99).
In its Cornetto range, Walls has added a Premium tier: Cornetto Choco Disc (rrp 99p). The cone contains vanilla ice cream with a Dulse de Leche sauce core and a milk chocolate disc with cashew nuts on top.
Finally, Walls is bringing back an old favourite to impulse - Mint Feast (rrp 65p).
New to Magnum in impulse this year is Magnum Ecuador Dark (rrp £1.10), made from vanilla ice cream covered in thick Ecuadorian dark chocolate with 62% cocoa content. Walls hopes the launch will capitalise on the rise in popularity of dark chocolate to provide a 'grown-up' ice cream experience. The launch will bring Magnum's impulse range to six. It's also adding new variant Magnum Colombia Aroma to multipacks.
The marketing for Magnum this year will emphasise the origins of the ingredients of the ice cream.
New lease of life
Last year Fredericks scored a hit with its Crunchie Blast ice cream, which was one of the fastest selling new ice cream products last year. David Taylor says that good npd and better distribution helped the company's sales: "We're breaking the door down, but it's been a matter of attrition over the years."
He says the big news for the company comes in the Del Monte brand, with the introduction of Del Monte Smoothie into the convenience sector. The Smoothie is low in calories, virtually fat free and contains real fruit and did well in the grocery sector last year, according to Fredericks. Existing variants raspberry and mango will be joined by strawberry & banana this year. Smoothies have a rrp of £1 and are also available in a three-pack for £1.99.
Fredericks is also focusing on the treat side of the market this year with the Cadbury Flake 99 Raspberry cone, which replaces the Strawberry cone. The cone is lined with milk chocolate and filled with vanilla ice cream churned with a raspberry sauce and smothered in hundreds and thousands, topped with a piece of Cadbury Flake. The cone has a rrp of £1.10 (four-pack retails at £2.49).
Last year saw the launch of the Cadbury Creme Egg bar into confectionery and this has been carried through to ice cream with
an ice cream bar featuring the Creme Egg flavour. The bar has a rrp of 75p (four-pack £1.99).
Staying with bars is one exclusively available to impulse. The Cadbury Chunky Choc Ice comes in cases of 35 bars with a rrp of 65p. Other changes include new packaging on the Cadbury stick range.
Masterfoods' Andrea Taylor says that innovation is particularly good at driving growth when it is based on a strong existing brand. This year in impulse Masterfoods is launching Twix Xtra (rrp £1, multipacks of six, £2.49). It's a crunchy Twix biscuit and real dairy ice cream, topped with soft caramel coated with milk chocolate. Masterfoods says it's the only ice cream in the market to feature real biscuit.
To tie in with the new launch, Mars and Snickers ice creams will now be re-branded with the Xtra name. Masterfoods says it will be investing £3.6m in a consumer campaign for the ice cream range.
Taylor adds that the company increased its distribution points by 25% last year and hopes for a similar success this year with another increase in visits to retailers.
Sell, sell, sell
When it comes to merchandising, Taylor says there's a lot the retailer can do to help their cause: "The retailer can help by keeping the freezers well stocked and looking good. It's like anything - if it looks good, people will buy."
He recommends that smaller shops concentrate on their impulse offering in the high season: "There's more business to be done if you've got one small impulse freezer and concentrate on impulse. If you've got a larger freezer then put the take- home ice cream in that. In the heart of the summer, make sure you keep the impulse freezer well stocked - impulse can really fly out the door."
Wilson adds: "It's frustrating when you go out to independents and see freezers not being used and see things piled on top of them. Big manufacturers like ourselves have a huge part to play in pushing better freezers."
Threats from the mults
According to Walls, impulse ice cream in the grocery channel is growing 24% year on year through the major multiples selling ice cream at the front of their stores. Walls says it has placed 3,500 of these cabinets in these retailers
in the past two years. However, Wilson says that this won't affect
the convenience market: "If you look at the absolute numbers, it's still pretty small."
Wilson says that impulse ice cream sold in grocery accounts for only £6.5m turnover, against £230m in convenience. "I think it's a different eating occasion. When you go to a supermarket you are normally doing a big shop and maybe want an ice cream for afterwards," says Wilson.
Taylor agrees that persuading people to buy more impulse wherever it is can only help shake impulse ice cream out of its long-term decline. "I think it means people will just get used to buying impulse ice cream again instead of in multipacks."
He also points out that the nature of impulse ice cream means that it's unlikely that someone would drive to the supermarket solely to pick it up. "After all, it's not very portable," he points out.
McIntosh believes that mums may use it as a pacifier for kids while out shopping: "It may serve to keep mum happy while they're travelling round the supermarket."
Taylor sums up: "As an impulse product, ice cream stick sales are geared towards convenience stores, as consumers will react to fair weather by visiting the local store."
The way ahead
As for the future, David Taylor sees little threat to the market, such as the 2001 introduction of the McFlurry by McDonald's. "McDonald's isn't going to launch the McFlurry again. The decline is probably bottoming out."
McIntosh says she sees no reason why this year shouldn't be as good as last year and Wilson agrees: "You've got to remain optimistic. The longer-term trend tells you ice cream is moving in the right direction."
On the rainy February day that Convenience Store visited the Mediterranean Supermarket in Welling, south-east London, customers were
by-passing the ice cream freezers for warmer fare. However, owner Philip Constantine says that ice cream sales shoot up by about 40% in the summer as locals flock in to cool down.
"We're opposite a green where people play football and they come in afterwards."
Other custom comes from passing traffic as the store is right on the main road through Welling.
While only two dedicated ice cream freezers are operating at the moment, usually there are three: two floor units and an upright. Philip says he will be back up to full strength well before the summer months.
Philip sells a range of ice cream including handheld, tubs and block, which he says are popular with the elderly ladies living in the residential area just across the road.
In handheld his biggest sellers are Twister, Clipper, Mini Milk (popular with mums) and Magnum, but he says customers always like to try new lines and he stocks as early as he can.
Out of stocks aren't an issue: "We have two back-up freezers at the back of the store which we keep stocked up so we can refill as we need to."
He says if the weather is good, sales of handheld can start to rise just after April, and they tail off at the end of September.
Peak times throughout the day for ice cream include 3pm on weekdays with young children and mums, and then slightly later for older children making their way back from school - a bus stop outside the shop brings them right to his door.
Philip also sells ice cream in one of his other larger floor freezers, alongside frozen desserts, and says Viennetta does particularly well.
He estimates that ice cream makes up about 5% of his overall sales, but is hoping to increase this when the shop undergoes a refit at the end of the summer. A new layout will mean more space for impulse buys by the till.
Too big a bite?
If some of your customers love Magnum but find it too big a bite for them, then they could be in luck. Walls is looking into the possibility of bringing a reduced size version onto the market in the next few years.
The version won't be bitesize but slightly smaller than the Magnum on sale now.
The company has had feedback from some female customers who say that the existing product is a bit too big for them. The company already produces a smaller version in multipacks available in Waitrose and elsewhere in Europe.
Walls is offering last year's prices for retailers who buy its freezers before April 6, 2007. The company says it will pick up your old freezer for free, recycle 97% of it and plant a tree.
Fredericks has two freezer deals this year for Husky freezers with rich stock deals. The freezers are available with Cadbury and Del Monte branding and for the first time the company is introducing a freezer with a smaller footprint.
Richmond is offering several deals on freezers, including stock for various size stores, all of which include a one-year parts and labour warranty.
Masterfoods is offering several deals. All its freezers come with branding, pos and warranty which includes one-year labour, two-year replacement parts and five-year replacement compressor.
Go with the flow
ServEquip has lauched a new dispensing unit which serves multiple flavours of soft-serve ice cream from one unit. The One-Shot System works via a single-portion container which is placed into a dispenser.
The machine can serve at least 150 portions an hour and the ice cream containers can be recycled.
Handheld singles grew by 5.8% in value in 2006 compared with 2005
Volume sales grew by 4.8% over the same period
The handheld singles market is worth £230m
source: Unilever IRI 2006.
Create an awareness outside store - let people looking down a busy row of shops know that it's you they should go to for an ice cream
Site the freezer in a visible high-traffic place - don't make the customer search for it
Site freezers near other impulse products
Use pos to direct customers to the freezer
Keep it clean! There's nothing more offputting than a dirty cabinet covered in ice
Select the right range for your store
Stock new products - ice cream buyers love npd - but don't forget the old favourites
Remember one product per basket - don't mix different products in the same basket
Segment the cabinet in a logical way - put children's products in one area, cones and refreshment in another.
Source: Unilever Partners for Growth/Masterfoods