Things are changing for the better. The ice cream industry is happy that though summer months still dominate sales, the seasonal variation between hot and cold months is plummeting.
Normally, sales in the winter months fall sharply due to seasonality and the reduced incidence of consumers venturing out of their houses.
While out-of-home consumption is the main reason for the sales of ice cream, what’s correspondingly driving revenue is individual in-home consumption due to quick commerce. Normally, the first six months of the fiscal year can account for 60% of annual sales, or even higher for some brands.
Graviss Foods (Baskin Robbins) CEO Mohit Khattar explains that, over the years, the company has been witnessing relatively stronger performance in the winter months (or the second half of the fiscal year). “Contribution for the second half of the fiscal year is now up to about 47% of annual sales from 40%.” Given the robust growth that we have been witnessing, our average sales in the winter months were at almost similar levels as sales in the summer months in the 2019-20 (pre-Covid) period,” said Khattar.
According to Indian Dairy Association President R. S. Sodhi, the seasonal variation in consumption of ice cream is certainly reducing, and one of the main reasons is that individual consumption of ice cream at home has gone up due to e-commerce and quick commerce. People also have bigger freezers at home. Additionally, there is a wider choice in flavours today as compared to, say, a decade ago.
Sodhi, nevertheless, said the seasonal variation in the north would still be greater as compared to other regions. “If the ratio of consumption is 1:5 between the peak seasonal months of winter and summer in the north, in other regions the same would be 1:2,” Sodhi said.
With around 850 stores, Baskin-Robbins is the second-largest QSR brand in India. Amul, the country’s largest ice cream player, recently said it plans to roll out 100 ice cream parlours in the country, offering premium ice cream flavours.
At an industry level, ice cream is growing at about 17%, said Khattar, with Baskin-Robbins growing at a faster pace than the industry. The prime drivers of growth, he said, are the Gen-Zers.
Earlier, ice cream was a relatively reward-driven category. That behaviour is changing now. People like to celebrate their little joys with ice cream. Today, there are multiple occasions for people to consume ice cream, whether it’s while binge-watching movies, going out with friends to the multiplex, or for any other reason.