Functional Ice Cream Market: Information by Flavor Type (Vanilla, Chocolate, Hybrid and Others), by Claim (Lactose-free, Sugar free, Vegan, Multi-claim, and Others) by Distribution Channel (Store based {Supermarkets/hypermarkets, Specialty Stores, and Others} and Non-Stored Based) and Region (North America, Europe, Asia-Pacific, and Rest of the World)—Forecast till 2028

Functional Ice Cream Market Overview

The global functional ice cream market share is projected to register a CAGR of 8.56% and reach a value of USD 319.8 million by 2028. Functional ice cream market is still in the nascent stages of development and is expected to show high growth during the forecast period. Demand in the developed economies has been high, while that in emerging economies is expected to gradually increase during the forecast period. Experimental eating habits and health conscious binging is expected to significantly increase during forecast period. Increase in demand for functional products in the region is expected to supplement the growth of functional ice cream market in Asia-Pacific.

COVID-19 Impact Analysis

COVID-19 has created immense pressure across the supermarkets & hypermarkets, retail stores, and other intermediate nodes of the supply chain. As a result of increasing panic among consumers for food, stockpile for fresh and processed food have become a common phenomenon in early stages of the pandemic lockdowns across the globe. The manufacturers of functional ice cream are focused on online retail to meet consumer demand. However, the biggest concern remained in logistics during the lockdown. The rapid proliferation of the COVID-19 pandemic throughout the world is leading to increased restrictions on vehicular movement and trade.

As the global economy is still under significant pressure due to the pandemic and is recovering slowly, its impact on the global trade and supply chain has been low during 2021. The governments of various countries have imposed strict containment and preventive measures to control the impact of the outbreak resulting in restricted transportation of raw materials across the globe. Therefore, a demand and supply gap were formed, but swell in demand for packaged goods was observed. This trend is expected to continue owing to the uncertainty in the global market. Partial easement of lockdowns in multiple countries and restarting of trade in some capacity has shown positive effect on the market. While growth of market is slightly dampened due to lower spending power of consumers during the COVID-19 crisis, the effects are expected to subside during short term forecast.

Market Dynamics

The growth of the functional ice cream market is expected to be driven by the increasing consumer awareness and demand for functional products across the globe. Functional ice cream has been popular for multiple years and consumers with high health awareness like sports enthusiasts have been primary consumers. Prices of the functional ice cream are high in comparison with conventional ice cream products due to high production cost and high initial investments involved. This can affect the consumer adoption in early stages, but new players entering the market can increase the competition and in turn increase power of buyers in long term.

• Increased Demand for Functional Products

Increase in demand for functional products has been observed during the pre-COVID-19 crisis, and usage of these supplements to meet nutritional needs has been one of the evident trends in the food and beverages market. Companies working in functional ice cream market have been working for nearly a decade to establish foothold in their region. High demand for organic and non-GMO products has been observed and has highly benefitted in the growth of functional ice cream market.

Change in purchasing patterns and increased demand for immunity boosting products has been observed globally but is highly evident in North America and Europe. The increasing discretionary income of masses in these regions has further stimulated the demand. With brands pushing their products with exotic flavor pallets and fruits, the demand for wellness products has been high. Asia-Pacific market has also seen similar trends, but impact has been on the lower side. Uptick in demand for functional products and robust demand for organic products in the region is expected to augment the demand for functional ice cream during the forecast period.

• Increased Demand for Plant-based Products

Existing demand for functional ice cream has been high in the market, demand from some demographics has shown increase during recent years. Increased consumer awareness of the nutritional labels and low preference of highly processed ingredients has supplemented the demand of functional ice cream. The increased lifestyle changes and adoption of new diets like keto, vegan and organic, has positively affected some functional ice cream market, and is expected highly benefit during the forecast period.

The increasing market for functional products has also boosted the demand. High level investments and innovative products lines for plant based functional products is expected to augment the demand for functional ice cream during the forecast. The trend for plant-based products has shown high effect on consumer preferences in the United States. The impact in the market is in early stages, and innovative plant-based functional ice cream can benefit from this trend.

• Premium Pricing of Functional Ice Cream

While existing demand for functional ice cream has been high in the market, demand from some demographics has shown decline. While functionality of the functional ice cream has been proven, the prices of functional ice cream is premium, and can increase the churn rate during early stages and also affect brand loyalty.

• Certification Labels to Boost growth of Functional Ice Cream

Increased consumer awareness of the nutritional labels and low preference of highly processed ingredients has affected the demand of multiple products. The increased lifestyle changes and adoption of new diets like keto, vegan and organic, has positively impacted the growth of wellness products market. Companies showcasing their products with clean labels like non-GMO, organic, vegan, and dairy free among others can significantly benefit the brand image and adoption trend. Companies investing in certification labels are expected to gain higher consumer base and brand loyalty in the long run.

Value Chain Overview

The value chain of functional ice cream includes 4 major nodes i.e. raw material suppliers, manufacturers, intermediate distributors and online retail. Raw material is sourced by manufacturers from raw material suppliers at bulk prices and is processed into final product. The manufacturers sell their products through online retail as well as brick and mortar stores. The final products are supplied to brick and mortar stores through intermediate distributors. The products are also directly sold to end users through online retail.

Segment Overview

By Flavor Type

Based on flavor type, the global functional ice cream market has been divided into vanilla, chocolate, blends and others. The vanilla segment accounted for the largest market share in 2020. This can be attributed to the significant consumer level demand for mild flavoring and low sugar preferences.

By Claim

Based on claim, the global functional ice cream market has been divided into lactose free, sugar free, vegan, multi-claim and others. The vegan segment accounted for the largest market share in 2020, and is expected to show moderate growth during the forecast period.

By Distribution Channel

Based on distribution channel, the global functional ice cream market has been segmented into store-based and non-store based. The store-based segment is further segmented into supermarkets & hypermarkets, specialty stores, and others. The changed consumer purchasing pattern has shown high impact on supermarkets or hypermarkets segment and is expected to increase demand through non-store based channels till the mid-term forecast.

Global Functional Ice Cream Market Share, by Region, 2020 (%)Source: MRFR Analysis

Regional Analysis

The global functional ice cream market has been divided into geographies as North America, Europe, Asia-Pacific, and Rest of the World. North America accounted for the largest market share of 54.7% in 2020. Europe captured the second-largest market and is expected to register the highest growth rate during the period of 2021 to 2028.

North America Market

The North America functional ice cream market accounted for the highest share of the global market in 2020. North America is a budding market for functional ice cream due to existing substantial demand and new players entering the market. While increased adoption trend of functional ice cream has been slightly affected due to the palatability of the products, demand for functional ice cream is expected to hold strong during the forecast period. High discretionary income and high spending on plant based products and dairy alternatives is expected to boost the growth of functional ice cream in the North America region.

Europe Market

Europe is expected to be a lucrative region for manufacturers of functional ice cream. The growth of the regional market is marked by the adoption of healthier life choices during the post pandemic demand. The increasing awareness of lactose free and in the region can highly increase the demand for vegan and dairy free. Europe is expected to witness high growth during the forecast period

Competitive Landscape

The market for functional ice cream is highly fragmented with top players accounting for minimal revenue share in the market. The market comprises tier-1 players along with some domestic players working in their local area. Companies have been launching new products with regionally recognized brands to increase sales. The companies have also invested in increasing collaborations and agreements to increase their end mile reach in their domestic market. Some companies have also invested in increasing their digital footprint to increase their brand presence in the market.

Prominent players in the global wellness products market include Nightfood(United States), The Brooklyn Creamery(India), Foxy's Thoughtful Icecream(United Kingdom), LightWhey(Dubai), One Earth Functional Food Ltd(Canada), LOHILO(Sweden), Wells Enterprises Inc.(United States), Guudy Icecream(United States), The Urgent Company(United States), and Coolhull Farm(Ireland).

Recent Developments –

In April 2021, Nightfood expanded their retail footprint with launch of their products in more than 1,000 Walmart stores.

In March 2020, The Brooklyn Creamery Launched vegan Acai Berry, Peanut Butter Ice Creams in India, to increase their regional presence.

In July 2021, LightWhey has launched their products in more than 650 stores in the UAE. The company has also planned to increase their foot print in the UAE by targeting to cover more than 1000 by end of 2021.

In June 2021, Eclipse, the USA plant based ice cream brand, has launched 6 new flavors. The newly launched flavors are Mango Passion Fruit, Strawberry Fields, Coffee Chip, Mint Chip, Caramel Butter Pecan, and Dark Side of the Spoon.

Report Overview

Functional ice cream market report provides snapshot of the current market as well as the growth prospects over the forecast period (2021-2028). The report offers key insights regarding the market size, regional analysis, segmental overview, competitive landscape, analysis of key players, and analysis of COVID-19 impact on functional ice cream market. The report includes overall evaluation of supply chain and value chain of the market. The report provides in depth assessment of dynamics like growth drivers, looming opportunities, challenging factors and anticipated impact over the forecast. The report includes benchmarking of key players as well as developments carried out in the market.

Objectives of the Study –

The objectives of the study are summarized in 5 stages. They are as mentioned below:

Market Size and Forecast:

To identify and estimate the market size for global functional ice cream market segmented by flavor type, claim, and distribution channel by value (in US dollars). Also, to understand the consumption/ demand created by consumers of functional ice cream during the period of 2021-2028.

Market Landscape and Trends:

To identify and infer, the drivers, restraints, opportunities and challenges for the global functional ice cream market.

Market Influencing Factors:

To find out the factors which are affecting the sales of functional ice cream among consumers.

Impact of COVID-19:

To identify and understand the various factors involved in the global functional ice cream market affected by the pandemic.

Company Profiling:

To provide a detailed insight on the major companies operating in the global functional ice cream market. The profiling will include the financial health of the company past 2-3 years with segmental and regional revenue breakup, product offering, recent developments, SWOT analysis, and key strategies.

Scope of the Report

Global Functional Ice Cream Market, by Flavor Type

• Vanilla


• Chocolate


• Blends


• Others

Global Functional Ice Cream Market, by Claim

• Lactose free


• Sugar free


• Vegan


• Multi-claim


• Others

Global Functional Ice Cream Market, by Distribution Channel

• Store Based
  
  
  
  • Supermarkets/Hypermarkets
  
  
  • Specialty Stores
  
  
  • Others
  
  
  
  


• Non-Store Based

Global Functional Ice Cream Market, by Region

• North America


• US


• Canada


• Mexico


• Europe


• UK


• Germany


• France


• Italy


• Spain


• Rest of Europe


• Asia-Pacific


• China


• India


• Japan


• Australia and New Zealand


• Rest of Asia-Pacific


• Rest of the World


• South America


• Middle East


• Africa

Intended Audience

• Functional Food Manufacturers


• Functional Ice Cream Manufacturers


• Dairy Products and Derivatives Manufacturers


• Commercial Research and Development Institutions


• Retailers, Wholesalers, and Distributors


• Governments, Associations, and Industrial Bodies


• Investors and Trade Experts