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Thawing market prompts demand for ice cream to soar

09-Jul-2014 - By RJ Whitehead
Thawing market prompts demand for ice cream to soar
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New data indicates that India’s ice cream market is the fastest growing in the world, as the product quickly becomes part of the country’s modern culture. 

However, according to the report by Canadean, the rise of ice cream comes on the back of sheer weight of numbers, with per-capita consumption still the lowest across all major global markets in 2013.

Though this is set to quickly rise as more Indians visit the growing number of ice cream parlours and take a greater interest in packaged frozen goods from supermarkets and the increasing number of kirana stores with cold storage.

Changing perceptions

Traditionally, the Indian ice cream market has been dominated by the impulse category, with consumers seeing the product as an occasional treat for the hot summer season. 

However, the growth of ice cream parlour culture in India is causing this perception to change, leading to a greater demand for take-home products as more Indians enjoy their ice cream throughout the year and not just during the summer. 

Indian consumers prioritise the fun that ice cream products can offer above all else. As a result, the desire among Indian consumers to create fun sharing occasions will cause sales of take-home ice cream to rocket, growing at a compound annual growth rate of 15.5% from 2013-2018. 

India also experiences an above-average need for ethical ice cream on account of the large vegetarian and Hindu population in the country, and its increasingly active internet users are creating new opportunities for brands.

New lines

According to Catherine O’Connor, senior analyst at Canadean: “Buoyed by rising disposable incomes, increasing home-freezer ownership, and the growing reach of cold-chain distribution pathways in the country, the time is now for the Indian ice cream market.”

Ice cream parlours are a booming business in India, and this popularity is making its way to retail. “Manufacturers of packaged ice cream can tap into the popularity of the parlour by presenting fun products for sharing occasions, as well as ice cream party kits that allow consumers to add their own toppings to products, creating a fun, novel experience for all the family to enjoy together,” added O’Connor.  

Chains like Baskin Robbins and Mövenpick have recently extended their menus with cakes, coffee and sandwiches to capitalise on high footfall. 

Baskin Robbins has also been devising a “celebration” category that will offer ice-cream cakes and rolls, while Mövenpick has been adding locally produced allied products, like waffles and sandwiches to its imported ices.

However, market potential and corporate optimism have yet to translate into soaring sales this summer with some ice cream chains reporting a poor season. 

Dust storms in Delhi were not conducive and have taken its toll on ice-cream sales. Sales did not live up to our expectations during May,” Nitin Arora, chief executive of Delhi-based Creambell, told The Hindu.

Related topics: Asian tastes, Markets, Dairy, India