Ice-cream business is seasonal in nature with sales peaking from April to June, and dipping drastically from November up to January, and slackened sales during the monsoons as well. But in recent years, consumption of icecream and other frozen novelties in winters has been on the rise. R S Sodhi, Managing Director, GCMMF Ltd (Amul), shares insights on the changing trend.
Typically considered a summer treat, sales of ice-cream is on the rise in winter months as well. Please share your views.
The ice-cream industry is one of the fastest growing product categories in the country. Amul commands 40 percent share in India’s icecream market. It operates retail formats like Amul Parlours (APOs), Scooping Parlours, Pushcarts, besides being present in general retail outlets. Yes, extreme winters do affect the sales especially in northern and eastern region, which usually experience climatic changes in extremes as compared to west and south. But it is worth mentioning that over the years, the trends have changed. Looking a few years back, Ice cream was considered a seasonal business but now it is not so otherwise we would not see so many new players vying to enter this business. Moreover, we take various efforts to drive consumption even during the months of peak winter by promoting the impulse varieties and taking advantage of the Christmas and New Year festivities. Amul’s winter sales are about 55 percent of the sales achieved during the peak months.
How has consumer perception changed over the years?
Consumers today are well informed and quite product conscious as compared to a few years back. Moreover, with consumers now becoming global citizens their interaction with other cultures has increased, wherein one can find that ice creams do hold a place in the desserts section. With Indian palate developing to the tastes of Mexican, Italian, Continental cuisine, the food preferences are also changing. A youngster today is not wary of eating ice creams in winters for fear of catching a cold.
Moreover, with more and more ice cream parlours coming up, these have also become places to hang out with friends, be it any season. AMUL Scooping Parlours have been witnessing almost consistent sales during winters also. We have taken several initiatives to reduce seasonality during winters. Our Family Fun pack is our card to promote impulse into take home category wherein even impulse range like sticks and cone can be enjoyed with the family and friends in the cosy comforts of their homes.
What are Amul’s ice-cream retail formats?
We have retail formats like the Amul Parlours (APOs), Scooping Parlours, Push Carts, and general retail outlets. The company franchised outlets APOs and Scooping parlous have low variation in sales and offer a medium for close interaction with customers with the range of Amul products. These formats offer scope to showcase the entire range of Amul Ice Cream. Scooping Parlours sale scoops apart from the regular packed ice-creams. They give versatility to experiment with different flavours of ice-cream and offer many combinations of ice-cream sundaes, shakes and other products.
What schemes and offers by Amul are driving sales in winter?
The winter season is a lean month; sales for the months of November, December, and January are about 55 percent of the sales achieved during April, May, and June, cumulative. Though consumption patterns in the monsoon, autumn and winter months reduce, the festival season boosts sales as people venture out and spend on eating out and other indulgences. This gives us an opportunity to drive sales with festival specific offerings, new flavours and packs. Our Scooping parlours give us space to innovate and undertake various promotional activities such as a Rs 15 scoop on every 15th of the month and offering new flavours under ‘debut of the month’ concept.
We keep coming up with festival related activities with offers and schemes in terms of new flavours and packs. This has resulted in creating awareness amongst consumers and also has helped reduce the seasonality factor. By introducing winter specific ranges in our ice-cream packs like nuts and chocolate based ice-creams as well as with new packs of impulse range, we have played our part in trying to change the palate pattern of consumers especially during winters. We believe that with every coming year the seasonality factory will go on reducing.
What else drives sales in the cold season?
Fortunately, demand for catering in marriages is mostly in the winter months. This too helps us in maintaining a stable demand during the off season. Institutions and hotels are also big segments which drive consumption year round. Demand from this segment is more or less stable and not affected much by seasonality.
We have, however, not been able to meet the consumption levels of ice-cream worldwide specifically the western countries level. We are still at the level of 400ml of per capita consumption of Ice cream per year compared to the global average of 2300ml per capita annually. The western countries have traditionally been high consumers with per capita consumption annually as high as 24 litres for USA. The indulgence is generally due to lack of other desert option which is limited to chocolate and ice-cream. Indians on the other hand have a wide range of indulgences in various traditional and regional sweet varieties. Ice cream is slowly taking the share of the palate and serving as an option to the sweet tooth that Indians traditionally have.