A sweet spot for ice cream sales

Ice cream has taken a large scoop out of the UK dairy retail market, with spending on ice cream growing by 6.9% in the last year.

We have explored this trend in recent articles and shared future growth opportunities and predictions for dairy farmers, processors and retailers.

As we have seen for many food and drink categories in retail, spending on ice cream has grown significantly. However, this is driven by inflated prices rather than sales, as units are down -4.4%.

The number of households buying into the category remains extremely high at 9 in 10, but high prices mean they have to shop the category less frequently, and when they do, buy less (Kantar, 52 w/e 9 June 2024).

This will undoubtedly be the continued impact of the cost-of-living crisis, negatively impacting treating categories like desserts.

Unsurprisingly, ice cream sales rise in the summer months, coinciding with warmer weather. However, with UK summer weather becoming increasingly unpredictable, the focus should be on helping consumers view ice cream as less weather-dependent.

Processors and retailers could promote ice cream as a year-round indulgence for consumers, tapping into occasions beyond just a ‘cooling down’ treat on a summer’s day.

Sixty-eight per cent of consumers who have eaten ice cream in the last three months said they often eat it with a dessert and 63% eat it when having an evening in (Mintel, Ice Cream – UK, 31 March 2024).

Many consumers have also turned to at-home socialising in recent years, and according to Mintel, 46% of consumers who have eaten ice cream in the last three months often serve ice cream to guests when hosting at-home social gatherings.

Retailers can tap into these ice cream trends and encourage evening consumption by communicating things like ‘movie night’, ‘date night’ or ‘dinner party dining’, and by pairing inspiration and co-merchandise with relevant complimentary products, such as desserts, fruit or meal deals.

However, it isn’t just dessert that presents opportunities for dairy. Cheese and butter dominate lunchtime occasions. They are found in 24% and 15% of all lunchtime meal occasions respectively, and 65.5% of sandwich occasions featuring dairy.

Italian dishes also continue to gain a share of total dairy occasions, as carbonaras, pasta bakes and spaghetti bolognese all saw year-on-year growth (52 w/e 12 May 2024).

Tom Price, AHDB Retail and Consumer Insight Analyst said:

“Cost-conscious consumers have been making increasingly simpler meals with fewer ingredients in an attempt to save money.

"Therefore, a key focus to boost dairy usage should be on promoting the use of dairy as a ‘treaty’ extra ingredient or topping to add flavour to meals.

“Pasta dishes are a key area where added dairy can be used to enhance meals, for instance by promoting recipes that include cheese or encouraging the addition of ice cream or cream to desserts to boost enjoyment through indulgence.

“Milk usage within coffee is also increasing, so providing inspiration to help consumers recreate more premium out-of-home coffee experiences within their homes could help boost milk sales.”