Americans Are Still Melting for Ice Cream

Happy National Ice Cream Day! Ice cream sales continue to be hot in the U.S.
By Brian Sozzi ,

Obesity and diabetes be damned! 

Clearly, supposedly more health conscious Americans are enjoying a cold scoop of their favorite ice cream besides just on National Ice Cream Day, which falls on Sunday this year. According to Nielsen, Americans had spent almost $6.5 billion on ice cream for the 52 weeks ended May 28, 2016, an increase of 2.5% from the prior year. And it's not just ice cream that U.S. consumers are picking up at their local Walmart (WMT) - Get Report store or Kroger (KR) - Get Report , points out Nielsen. They're also buying frozen custard, nondairy ice cream and sorbet.

Sales of frozen custard have skyrocketed 134%, to $17.9 million for the 52 weeks ended May 28, while nondairy has seen a 43.7% surge, to $75.2 million. Sorbet weighed in at $68.5 million, an increase of 6%.

Ice cream sales in America remain hot.

People are also showing an appetite to pick up a bowl of ice cream on the go. Four of the top five limited-service frozen dessert players -- Dairy Queen/Orange Julius, Baskin-Robbins, Braum's Ice Cream & Dairy Stores, and YogurtLand -- saw an average 7.6% sales increase in 2015, per data analyzed by TheStreet from research firm Technomic. Cold Stone Creamery was the odd duck out, with its sales falling 0.4% last year.

"While there's certainly a trend toward health and wellness, indulgence still sells in food-service, and people still want to treat themselves," explained Technomic Advisory Group Senior Principal David Henkes on the strong demand for ice cream in a nation of alleged calorie counters, adding, "Small indulgences like ice cream still appeal to the consumer."  

Dunkin' Brands (DNKN) - Get Report owned Baskin-Robbins -- which has over 8,400 points of distribution in the U.S. -- continues to be one of the main beneficiaries of America's love affair with ice cream. Same-store sales at Baskin-Robbins U.S. rose a solid 6.1% last year and by 5% in the first quarter, when the winter weather theoretically should stunt interest in chilly ice cream.

In large part, Baskin-Robbins' impressive stretch of sales is being fueled by a relatively new business of online cake ordering and a steady stream of innovative products such as warm cookies with ice cream centers. "Every month we have something new and creative for the guest to try," Weldon Spangler, senior vice president of Baskin-Robbins U.S. and Canada, told TheStreet, adding, "The online ordering of cakes has expanded our reach to a lot of guests who maybe didn't know about us before."

Baskin-Robbins "Pinata Cake," which we saw while visiting the Boston headquarters of Dunkin' Donuts last year.

The latest addition to the Baskin-Robbins menu is the polar pizza -- basically, a pizza made of ice cream. It comes in four flavors and has two crust options.

Spangler echoed Henkes' sentiment on why ice cream sales are still hot despite people watching their waistlines. "While lots of people are being more careful about what they are eating, there is something about having a treat -- people work hard on their diet for much of the week and then occasionally want to treat themselves."

There is only so much leafy kale a person could eat, apparently.  

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