Functional Ice Cream Market Research Report Information By Flavor Type (Chocolate, Vanilla, Blends, and Others), By Claim (Lactose-Free, Low-Fat, Low-Calorie, and Others), By Distribution Channel (Store-Based {Supermarkets & Hypermarkets, Online Retail, and Others} and Non-Store-Based), By Claim (Lactose-Free, Sugar-Free, Vegan, Multi-Claim, and Others) And By Region (North America, Europe, Asia-Pacific, And Rest Of The World) – Market Forecast Till 2032.

Global Functional Ice Cream Market Overview

The functional ice cream market size was valued at USD 0.21 billion in 2022. The functional ice cream industry is projected to grow from USD 0.23 Billion in 2023 to USD 0.44 billion by 2032, exhibiting a compound annual growth rate (CAGR) of 8.56% during the forecast period (2023 - 2032). The rising demand for innovative flavors and types and the increasing health consciousness among consumers in developing countries are the key market drivers enhancing market growth.

Source Secondary Research, Primary Research, MRFR Database, and Analyst Review

Functional Ice Cream Market Trends

Rising Expenditure on R&D and Digitalization to Boost the Market Growth

The rising expenditure by prominent players on the research and development of innovative products is anticipated to impact market growth positively. For instance, in January 2022, Unilever Group launched vegan stick bars, magnum vegan classic, and magnum vegan almond in mini-sized multi-packs. Companies are actively investing in digitalization to increase their consumer base. The market players focus on digital channels to generate awareness of their brands and products. Major companies are planning to shun traditional media spend and invest their finances into ads on social media platforms, including Instagram and Facebook. Besides, influencer marketing has been an effective strategy used to reach the target audience. It mostly includes millennials and fitness & health-conscious consumers and has enhanced the functional ice cream market CAGR globally in recent years.

Further, increasing market players' interest in fortifying and adding functional ingredients can encourage consumers to choose the product as a healthy snack option. Functional foods deliver benefits beyond basic nutrition and may play a major role in decreasing or minimizing the risk of certain diseases. The rising production of fortified or functional products is expected to increase the consumption of the product globally. Healthy product options, such as fortified, low-fat, and many others, are easily available in the market as the producing companies have adopted proper branding techniques. These companies contact consumers with local distribution options such as hotels, restaurants, and malls. The easy availability of the product, along with the rising expenditure on such fast foods driving the functional ice cream market revenue growth.

Additionally, consumer awareness and desire for functional products are projected to fuel the growth of the functional ice cream market worldwide. Functional ice cream has been popular for several years, and health-conscious consumers, such as athletes, have primarily consumed it. Because of the high production costs and initial investments, the prices of functional ice cream are higher than those of traditional ice cream. This may impact consumer acceptance in the early stages, but new firms joining the market can improve competition and, as a result, buyer power in the long run.

Functional Ice Cream Market Segment Insights

Functional Ice Cream Type Insights

The functional ice cream market segmentation, based on type, includes chocolate, vanilla, blends, and others. The vanilla segment dominated the market, accounting for 35% of market revenue (0.08 Billion). In developing economies, category growth is driven by increasing product innovations and the rising consumer for convenient product options. However, chocolate is the fastest-growing category due to the growing preference for functional ice cream and the increasing importance of innovative and different flavors.

Functional Ice Cream Claims Insights

The functional ice cream market segmentation, based on claims, includes lactose-free, sugar-free, vegan, multi-claim, and others. The lactose-free category generated the most income (70.4%) due to the rise in demand for the development of lactose-free ice cream. According to a report issued in The Times of India in May 2020, 60% to 65% of the residents in India were lactose intolerant. However, vegan is the fastest-growing category over the forecast period due to growing consumer preference for vegan and natural ingredients in functional ice cream.

Functional Ice Cream Distribution Channel Insights

The functional ice cream market segmentation, based on distribution channels, includes store-based {supermarkets & hypermarkets, online retail, and others} and non-store-based. The store-based category generated the most income over the forecast period owing to increasing consumer curiosity for new flavors. The growing popularity of sundaes, a diverse range of flavors, and the availability of various products in retail stores. However, non-store-based is the fastest-growing category over the forecast period due to increased mobile adoption and broadband penetration, especially in emerging economies.

Figure 1: Functional Ice Cream Market, by Distribution Channel, 2022 & 2032 (USD Million)

Source Secondary Research, Primary Research, MRFR Database, and Analyst Review

Functional Ice Cream Regional Insights

By Region, the study provides market insights into North America, Europe, Asia-Pacific, and Rest of the World. The North American functional ice cream market will dominate due to the prominent companies that have changed their product portfolio according to consumers' interests and demands. Functional ice cream, which was widely considered an indulgent type in the past, has now changed to a stage where it is largely and happily perceived as a snacking option by consumers. Further, the US functional ice cream market held the largest market share, and the Canadian functional ice cream market was the fastest-growing market in the North American region.

Further, the major countries studied in the market report are The U.S, Canada, Germany, France, the UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

Figure 3: FUNCTIONAL ICE CREAM MARKET SHARE BY REGION 2022 (%)

Source Secondary Research, Primary Research, MRFR Database, and Analyst Review

The European functional ice cream market accounts for the second-largest market share over the forecast period. People in this region have become more conscious related their health and thus have been changing their preference for healthy food alternatives over conventional products. Further, the Germany functional ice cream market held the largest market share, and the UK functional ice cream market was the fastest-growing market in the European region.

The Asia-Pacific functional ice cream market is expected to grow at the fastest CAGR from 2023 to 2032. The region has been witnessing huge demand, especially from young consumers. Key manufacturers have been launching a range of products to cater to the growing preference for premium products. Moreover, China's functional ice cream market held the largest market share, and the Indian functional ice cream market was the fastest-growing market in the Asia-Pacific region.

Functional Ice Cream Key Market Players & Competitive Insights

Prominent market players are spending a lot of money on R&D to expand their product lines, which will help the functional ice cream market grow even more. Market participants are also taking various strategic initiatives to grow their footprint globally, with key market developments such as new product introductions, contractual agreements, mergers and acquisitions, product innovation, increased investments, and collaboration with other organizations. Competitors in the functional ice cream industry must offer cost-effective items to enhance and survive in an increasingly competitive and growing market environment.

Manufacturing locally to reduce operating costs is one of the primary business strategies manufacturers adopt in the functional ice cream industry to benefit clients and expand the market sector. The functional ice cream market major player such as Unilever (UK), General Mills Inc. (US), Blue Bell Creameries (US), and others are working on expanding the market demand by investing in research and development activities.

Unilever Plc is a manufacturer and supplier of fast-moving consumer goods. The company's product portfolio comprises food products, beauty, and personal care products, beverages, home care products, vitamins, minerals, and supplements. It markets products under the Bango, Ben & Jerry's, Hellmann's, Knorr, Magnum, The Vegetarian Butcher, Wall's, Axe, Dove, Lifebuoy, Lux, Rexona, Sunsilk, Domestos, Omo, Seventh Generation, Equilibra, Liquid IV, and SmartyPants brand names. It markets products to bricks and mortar store partners, small family-owned shops, online retailers, and value retailers. In January 2022, Unilever announced the launch of a new vegan ice cream under its magnum brand in Germany. The newly added vegan classic, vegan almond, and vegan hazelnut crunch bars are available on retail shelves across the country.

Dreyer's Grand Ice Cream, Inc, is an American ice cream firm founded in 1928 in Oakland, where its present-day headquarters office remains. The firm's two signature brands, Dreyer's Grand Ice Cream and Edy's Grand Ice Cream, are known after its founders, Joseph Edy and  William Dreyer. The Dreyer's brand is marketed in the Western US and Texas. In June 2021, Dreyer's Grand Ice Cream, Inc., a California-based ice cream manufacturing company and part of Nestle S.A., invested nearly USD 145 million to expand its production plant in Fort Wayne.

Key Companies in the Functional Ice Cream market include

• Nestle S.A. (Switzerland)


• Unilever Group (U.K.)


• General Mills (US.)


• Amul (India)


• Dunkin Brands (US.)


• Blue Bell Creameries (US.)


• Dairy Queen (U.S.)


• Dairy Farmers of America, Inc. (US.)


• Cold Stone Creamery. (US.)


• CAMAL Ltd Company (Azerbaijan)

For Instance, March 2022 Yuengling's Corporation, an American Functional Ice Cream manufacturing company, acquired Revolution Desserts, LLC, an Atlanta-based ice-cream manufacturing firm that owns Gelato Fiasco, Art Cream, Sweet Scoops, and SoCo Creamery brands. Revolution Desserts works in more than 600 retail stores globally.

For Instance, January 2022 The Ice Cream Factory, an ice cream manufacturing company in the US, expanded its manufacturing footprint by buying an 86,000-square-foot factory in Missouri. The firm invested nearly USD 9 million and is anticipated to create 130 new jobs over the next five years.

For Instance, January 2021 Northern Bloc, a leading manufacturer of plant-based desserts, secured an investment of USD 1.7 million. Northern Bloc will invest the funding to increase its production capacity, strengthen the team, and focus on brand experience across retail.

Functional Ice Cream Market Segmentation

Functional Ice Cream Flavor Type Outlook

• Chocolate


• Vanilla


• Blends


• Others

Functional Ice Cream Claim Outlook

• Lactose-Free


• Sugar-Free


• Vegan


• Multi-Claim


• Others

• 
  Store-Based
  
  
  
  • Supermarkets & Hypermarkets
  
  
  • Online Retail
  
  
  • Others
  
  
  
  


• Non-Store-Based

• 
  North America
  
  
  
  • US
  
  
  • Canada
  
  
  
  


• 
  Europe
  
  
  
  • Germany
  
  
  • France
  
  
  • UK
  
  
  • Italy
  
  
  • Spain
  
  
  • Rest of Europe
  
  
  
  


• 
  Asia-Pacific
  
  
  
  • China
  
  
  • Japan
  
  
  • India
  
  
  • Australia
  
  
  • South Korea
  
  
  • Australia
  
  
  • Rest of Asia-Pacific
  
  
  
  


• 
  Rest of the World
  
  
  
  • Middle East
  
  
  • Africa
  
  
  • Latin America