Ice Cream Makers Find the Road to Success Is Fat One

Ice cream makers like quirky Ben & Jerry’s and Haagen-Dazs are on the fat track, pushing out more products heavy with butterfat, swirls and nuts to satisfy richer appetites of richer Americans.

Instead of plain old flavors like vanilla or strawberry that cost about $1 a pint less, the rage is for sinful scoops like Chocolate Overload and Cookie Dough Chip with fat contents so high they will knock your heart out.

“People are indulging these days. They work out and then eat a whole pint of ice cream. When they decide to go for the fat, they go for it,” said Jeremy Kraus, the 23-year-old founder of Philadelphia-based Jeremy’s MicroBatch Ice Creams, one of a handful of new companies cropping up to take advantage of the demand for gourmet brands.

The trend is good news for the superpremium and premium--better known as gourmet--ice cream makers, particularly Ben & Jerry’s Homemade Inc., Haagen-Dazs, a unit of U.K.-based food and beverage giant Diageo Plc, and Dreyer’s Grand Ice Cream Inc., which have most of the market.

“It’s a backlash against the previous trend of stripping dessert of all its goodies,” said ice cream analyst Ann Gillin Lefever of Sanford C. Bernstein. “The indulgence flavors are really where the growth is at.”

Last year, the ice cream makers saw their revenue melt by about 5% as butterfat prices soared higher amid weird weather patterns that caused a dwindling of supplies, analysts said.

Analysts were reluctant to predict an average price for butterfat for 1999, but the International Ice Cream Assn. points out that raw milk prices fell earlier this year because of strong production rates.

“If there is a drop in butterfat, there is potential for significant upside” in the gourmet ice cream industry, said analyst James Barrett of Josephthal & Co., noting the rise in demand for the brands.

Over the past three years, Americans have been steadily gobbling up more and more gallons of gourmet ice cream. Last year, superpremium and premium volumes grew an estimated 10.3% and 5.7%, respectively, in the $4-billion ice cream market.

The gourmet varieties now command 41% of market share, an increase from 38.6% in 1997 and 28.5% in 1996, according to data from research group A.C. Nielsen.

You can blame the extra inches to the national waistline on the strong economy: Today’s high-fat gourmet ice cream is generally considered a discretionary-income item.

The average Joe not only can afford to pay the extra buck for a pint of ice cream that has less air than regular brands and a fat content of about 14% to 22%, but he can also work off the calories in a gym.

“When creating flavors, we typically look for innovative dessert concepts that have not yet been translated into ice cream,” Kraus said.

Since its start three years ago, Jeremy’s Microbatch has evolved from a regional product found in 10 stores to a near nationwide phenomenon.

His flavors include Cinnamon Bun, a rich vanilla bean ice cream with a golden caramel-cinnamon swirl and lightly toasted pecans, as well as Classic S’mores, a chocolate ice cream base with marshmallow, chocolate chunks and chocolate-covered graham crackers.

Haagen-Dazs also is taking ice cream to the extreme.

Last year, the company introduced Dulce De Leche, a full-bodied ice cream based on an Argentine dessert that tastes a lot like caramel. It is now the No. 2 flavor after vanilla.