Ice cream: How the big firms innovate to stay ahead

I’m at the research and development centre of the world’s biggest publicly listed ice-cream maker, Magnum. Near Bedford in the UK, it’s where the company’s researchers dream up new recipes and develop their production processes.

What really catches my eye is a pale yellow glow in the corner of the room. The light emanates from a glow-in-the-dark ice lolly.

Launched in the clubbing capital of Ibiza, it’s targeted toward clubbers and festival-goers, and one of its ingredients, vitamin B2, is naturally luminescent and glows under UV club lights.

While a luminescent product may seem a bit of a gimmick, ice cream is a serious business and innovation is crucial to staying ahead of the game.

There’s tough competition from other giants including Häagen-Dazs owner, Froneri, and Baskin-Robbins, the world’s largest chain of ice cream specialty shops, not to mention smaller artisan ice cream makers that are popping up all the time.

They’re all dealing with a notoriously unpredictable market and with fluctuating commodity and energy prices. No one can afford to stand still.

“We’ve had five years of price volatility impacted by war in Ukraine, Covid, the cost of living crisis. We’ve now got the Strait of Hormuz. We’ve just been in this constant state of instability when it comes to pricing,” says Georgia Rose, principal analyst at global market research company, Kantar Retail IQ.

And those price fluctuations affect multiple areas of the ice-cream making process.

“Manufacturers have been hit by higher prices for dairy, cream, eggs; the ingredients that make ice-cream bases. And then you’ve got the flavours; vanilla, chocolate, sugar, fruit. And something that often gets forgotten is the cold-chain energy costs and storage,” she says.