Ice Cream Region Essay

5325 words - 22 pages

ICE Cream
Packaged Food -US$2.2 trillion
Ice Cream- US$71.6 billion
Dairy - US$436.2 billion
Oils and Fats - US$116.1 billion
Sauces, Dressings and Condiments US$114.4 billion
Global packaged food value share (2012):
1.9%
Global packaged food value growth (2011-2012):
5.2%

Unilever described 2012 as “bi-polar”, with sluggish growth in mature markets contrasting dynamic growth in emerging markets. The company’s turnover increased by 10.5% over 2011 taking the company past the €50 billion milestone for the first time. The company’s Personal Care and Home Care divisions showed double-digit growth.
Unilever reported double-digit growth in ice cream driven largely by ...view middle of the document...

4% and 28.8%, respectively, in ice cream. The ice cream market in Asia Pacific is far more fragmented than in Latin America with number one ranked Lotte Group capturing only 10.1% followed by second-ranked Unilever.

In ice cream, Unilever is well positioned in most markets for growth. In Brazil, it ranks number one with Nestlé a distant second. In China however, the company ranked third behind local players Inner Mongolia Yili and China Mengniu Dairy. There remain a number of smaller local players in China. Mengniu is attempting to move closer towards the premium end of the market which will position it to compete more closely with mid- to premium- positioned Unilever. Unilever has been focusing on building stronger distribution offering distributors higher mark-ups in order to gain new points of sale. The strategy is working as Unilever gained nearly one full percentage point in market share in 2012.

Unilever consistently outperformed Nestlé over the review period in virtually every market in which the two competed. Globally they ranked first and second, respectively. Unilever has invested considerable marketing resources behind the Magnum brand which it continues to roll out to new markets, most recently India where it will launch in April 2013. Magnum sales grew by 7% CAGR over the 2007-2012 period. Cornetto was another major winner for Unilever expanding by 8.1% CAGR. 2011 saw the Magnum brand launch in the US market where it has quickly gained prominence in supermarkets and hypermarkets. For Cornetto, Western Europe remains the key market although the brand also saw strong growth in Latin America and Asia Pacific over the review period.

Currently, the company is focusing its attention on its core brands, such as Knorr, Magnum, Bertolli, Flora, Ben & Jerry's, Hellmann's and Cornetto. These brands receive the largest proportion of investments in terms of both product development and marketing. Expansion of these brands into new segments and categories such as the Knorr Foil Steam Pouch line, launched in 2012.

As a core category for Unilever, ice cream has benefited from considerable investment in marketing and new product development and the Magnum brand in particular.

economic growth will boost demand for impulse and indulgence food in emerging countries like India, China and Brazil. This growth will largely be driven by middle class consumers in urban areas, who will continue to trade up from sugar confectionery and artisanal snacks to more expensive items, like chocolate confectionery and ice cream.
Private label sales are set to expand steadily in the medium term. Retailers' private label offerings are expected to enter emerging markets like India, where their presence is currently close to negligible.

Per capita consumption in countries like India (0.1kg), for instance, is still very low levels compared to North America (8.6kg) and Western Europe (4.1kg). Crucially, however, ice cream...

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