Saudi Arabia: Ice Cream Market and the Impact of COVID-19 on It in the Medium Term

Saudi Arabia: Ice Cream Market and the Impact of COVID-19 on It in the Medium Term

The ice cream market in Saudi Arabia was equal to 419.00 million USD (calculated in retail prices) in 2015. Until 2025, the ice cream market in Saudi Arabia is forecast to reach 664.04 million USD (in retail prices), thus increasing at a CAGR of 4.57% per annum for the period 2020-2024. This is an increase, compared to the growth of about 4.57% per year, registered in 2015-2019.

The average consumption per capita in value terms reached 13.62 USD per capita (in retail prices) in 2015. In the next five years, it grew at a CAGR of 2.31% per annum. In the medium term (by 2025), the indicator is forecast to speed up its growth and increase at a CAGR of 2.94% per annum.

One of the leading trends in the global ice cream market is connected with the constantly changing eating habits. Most manufacturers are constantly trying to develop new flavors in accordance with the contemporary consumers’ tastes. The younger population, in particular, is more adventurous, seeking new experiences, which determines the present trend towards exotic tastes. As a result, currently on the market can be found a wide range of flavors, including the untypical savory flavors such as smoked bacon and egg, black pepper, chili, thai green curry and many more. What is more, the experiential trend extends beyond taste to include texture. In order to appeal to all of the consumers’ senses, companies are innovating by introducing ice cream in a chewy crepe instead of a wafer cone.

Beside the industrial actors, numerous small and individual manufacturers produce top-range products, so-called artisanal ice cream. This category of ice cream is generally offered on the production site. Usually they promote their ice cream products as high quality and put an accent on the use of locally purchased raw materials. Although there are various differences in terms of packaging, prices and modes of distribution between artisanal and industrial ice cream, the increasing interest in the “home-made” ice cream suggests that there is a significant competitive pressure. Sometimes, however, smaller companies may not be able to afford their own ice cream parlors and must instead persuade supermarkets, specialist stores, and other businesses to stock their products.

Ice cream is among the food categories, which has also tapped into the growing fitness and sports nutrition trend. Consumers have been eager to try food options, including ice cream with claims such as added protein and functional energy. In response, companies are launching more ice cream products positioned for the sports nutrition space. To reach out to this consumer group, ice cream manufacturers have been also cutting sugar levels in these products.