‘Premiumisation’ underpins rise of Häagen-Dazs – and luxury ice cream

The rise of premiumisation – driven by the fact that shoppers are looking for a special indulgence not an everyday treat – has made luxury ice cream the jewel in the ice cream category’s crown.

Andy Foweather, sales director of General Mills UK, says: “Consumer behaviour is evolving and this is impacting on the way people shop the ice cream freezer. We identified the rise of ‘treating’ a few years ago but now we are seeing a definite premiumisation of the category.

“Consumers are not just interested in having what they perceive as an everyday treat: they are now looking for a real indulgence as a reward for dealing with the growing pressures of 21st century living.

“Luxury ice cream is viewed by consumers as a permissible treat. The growing health trend means that traditional snacks, small treats and desserts are increasingly falling off the shopping list. Conversely this is fuelling the desire for a special treat like Häagen-Dazs.

“Luxury ice cream in general and Häagen-Dazs in particular, because it is recognised as ‘The Longer Lasting Pleasure’, are ideal for delivering that level of indulgence and that is why the category and the brand continue to perform so well.

“Retailers need to ensure they reflect this change in terms of the freezer space they allocate to luxury ice cream, covering the breadth of the range for key brands such as Häagen-Dazs, in order to maximise the sales potential and satisfy this growing consumer demand.”

Sales of luxury ice cream have topped £100m (£105.4m) for the first time and the category achieved growth of 11.3% in the most recent 12-month audit period – well ahead of total ice cream which declined by 3.9% over the same time¹.

Much of that growth was generated by Häagen-Dazs which achieved annual retail sales of £38.4m and grew by 8.8% in value terms over the same period¹.

“The sales performance statistics on their own don’t really do justice to the strength of the Häagen-Dazs brand,” says Foweather. “The fact is that four out of the top seven luxury ice cream products are Häagen-Dazs1 - underlining its consumer appeal and unrivalled pulling power in the freezer cabinet.”

Not only that but the beauty of luxury ice cream brands such as Häagen-Dazs for retailers in the convenience sector is that, because of their link to treating, they are all-year round earners. Approximately half of Häagen-Dazs brand sales are generated in the winter months. Foweather adds: “The benefit of this is that a poor summer – like last year’s – doesn’t have a negative impact on sales.

“That is why retailers who are looking to build their luxury ice cream business must focus on harnessing the brand strength of Häagen-Dazs.”

General Mills UK believes the success of the brand stems from the ongoing programme of innovation, which refreshes its appeal on a regular basis by offering new variants, its renowned product quality and the fact that consistent TV advertising keeps Häagen-Dazs front-of-mind with shoppers.

A New Indulgence: Limited Edition Raspberries & Meringue
General Mills UK recently unveiled a new Limited Edition flavour - Häagen-Dazs Raspberries & Meringue (launched in March) – that provides shoppers with a new and refreshing treat, boosting sales of the brand and creating additional interest around the fixture. The product is available for six months only.

“We are generating interest in the luxury ice cream category through the regular introduction of six-monthly Limited Editions to deliver innovative flavours with broad appeal to consumers,” says Linda Hipkiss, marketing director of General Mills UK.

“We want to stimulate the taste buds of consumers and encourage them to experiment outside their normal flavour repertoire – and so far the Limited Edition strategy has worked spectacularly well.”

Another sales-driving initiative is the Häagen-Dazs Summer range which includes such seasonal favourites as Strawberries & Cream – to generate new sales momentum during a key period for luxury ice cream.

Links with Wimbledon and Heston Blumenthal
Häagen-Dazs also benefits from its association with prestigious events such as the famous Wimbledon Tennis Championships where it is the Official Ice Cream Supplier. Wimbledon perfectly reflects the iconic nature of the brand and provides an ideal platform to showcase its products.

And Haagen-Dazs has embarked on a shared journey with Michelin Starred Chef Heston Blumenthal to together discover why as a nation we are so passionate about ice cream and how, where and why we eat it.

Unlocking pleasurable sales:
General Mills UK cites visibility and inspiration as being fundamental factors for retailers when it comes to unlocking the potential of the luxury ice cream category.

Foweather says: “Applying a couple of straightforward merchandising principles can really help drive growth. Simply showing shoppers where to go and telling them what’s on offer will generate impulse sales. This is easily done through installation of signage and secondary displays.”

Foweather believes the most successful retailers will be those who make the category easier and more pleasurable to shop.

Foweather concludes: “Sorting out the way the freezer is merchandised - keeping it tidy, clearly distinguishing between the different flavours and making sure the best selling lines are always available - will enhance the shopping experience for consumers and drive category development.”

1 Source: IRI Grocery & Impulse Outlets 52 w/e 22 Mar 2008