Ice Cream and Frozen Desserts in South Africa

PROSPECTS

Ice cream increasingly consumed throughout the year

Ice cream and frozen desserts is traditionally a highly seasonal-sensitive category in South Africa. However, in 2019, there was an expansion in the number of occasions during which these products can be consumed.

Smaller packaging encouraging consumption of bulk ice cream

Bulk dairy ice cream continues to post strong growth, with sales being driven by the growing popularity of smaller and individual single portion variants at affordable prices targeting mid-income consumers, despite the current economic climate. At the same time, producers are also consistently investing in innovation in order to offer consumers greater value.

Supermarkets leads distribution but bleak prospects for frozen yoghurts as its popularity wanes

In the past, impulse ice cream used to be purchased from vendors and forecourt retailers. However, over the years these channels have gradually lost sales share to independent small grocers, convenience stores and supermarkets, which are increasingly stocking impulse ice cream.

COMPETITIVE LANDSCAPE

Unilever fights off private label competition to remain in pole position

Unilever continued to lead ice cream in 2019, despite losing marginal sales share due to growing competition from cheaper private label ranges. The company’s leading position can be attributed to its strength in impulse ice cream and the offering of a diverse range of brands such as Paddle Pop, Ola, Magnum and Cornetto.

Blurring line between chocolate confectionery and ice cream

Manufacturers are leveraging well-known chocolate confectionery brands to launch new types of ice cream. For example, during the review period, Dairymaid Nestlé launched a range of impulse ice cream products based on well-known Mondelez brands.

Rising price sensitivity fuels shift towards value for money brands

Dairymaid’s Farmhouse brand continues to post strong double digit value growth in South Africa. This good performance can mainly be attributed to the offering of competitive prices, with price sensitive consumers increasingly opting for bulk take home ice cream rather than more expensive impulse alternatives.

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