"Memories of the bygone era", is Häagen-Dazs no longer appealing? | Krypton's Major Events

Author | Chen Sizhu

Editor | Xie Yunzi

"A single ice cream cone costs 50 yuan, and the nicer - looking ones are nearly 100 yuan. I couldn't afford them when I was a kid, and I still can't now."

In the Chinese ice cream market, Häagen - Dazs is the well - deserved "Hermès". However, this high - end brand is becoming a thing of the past.

Recently, market sources reported that General Mills, the parent company of Häagen - Dazs, might seek to sell its Häagen - Dazs stores in China for hundreds of millions of dollars.

Bloomberg reported that "the negotiations are currently in the early stages, and General Mills may decide not to sell and intends to continue selling Häagen - Dazs products in Chinese supermarkets, convenience stores, and other places." That afternoon, General Mills responded to multiple media outlets, saying "it will not comment on the rumors."

However, it is a fact that Häagen - Dazs is facing growth pressure in the Chinese market.

According to General Mills' latest financial report, in the three months ending February 23, 2025, the net sales of its high - end ice cream business were 138 million US dollars, a year - on - year decrease of about 3.2% compared with 142 million US dollars in the same period last year. At a recent forum, Jeff Harmening, the chairman of General Mills, also publicly admitted that the footfall in Häagen - Dazs stores in China had declined by double - digit percentages.

At the earnings conference, Jeff Harmening further stated that "(Häagen - Dazs) stores have low profit margins but high fixed costs."

In recent years, General Mills has been continuously streamlining and divesting its assets. In 2024, General Mills successively acquired three pet - related companies and divested its North American yogurt business. In the Chinese market, General Mills sold the Chinese business of Yoplait yogurt to Tiantu Capital in 2019.

Therefore, the fate of Häagen - Dazs in the Chinese market has attracted more attention. How can this once - popular ice cream brand tell new stories and deal with development bottlenecks and the "mid - life crisis"?

The picture is taken from the Häagen - Dazs mini - program.

Store closures, market diversion, and the shattering of the "high - end filter"

In the US market, Häagen - Dazs, operated by Nestle, follows the fast - moving consumer goods route and can be easily found in supermarkets. However, when Häagen - Dazs entered the Chinese market, General Mills positioned it as a "premium product".

In 1996, Häagen - Dazs opened its first store on Nanjing Road in Shanghai.

In an era when the average monthly income was only 500 yuan, a single - scoop ice cream in a paper cup from Häagen - Dazs cost 25 yuan. Subsequently, through its exquisite store decoration and the classic slogan "Love her, take her to Häagen - Dazs", Häagen - Dazs quickly established its high - end image in the minds of Chinese consumers.

Over the next decade or so, Häagen - Dazs developed rapidly in the Chinese market. Its stores expanded to first - tier and new first - tier cities across the country. It also launched classic products such as ice cream mooncakes, and gradually broadened its retail channels to include C - end businesses such as mall and hotel customizations.

It is generally recognized in the industry that, like many foreign brands such as Starbucks, Häagen - Dazs has benefited from the dividends of China's economic development and the rise of the middle class. General Mills' financial reports show that from 2006 to 2015, the compound annual growth rate of Häagen - Dazs' sales in the Chinese market reached 33%.

However, with the rise of emerging ice cream brands and new tea - drinking brands, the Chinese ice cream market has become increasingly crowded: there is competition not only from foreign companies such as DQ and Unilever but also from relatively affordable domestic ice cream brands that have quietly emerged.

Data from iiMedia Research shows that in 2024, Gelato had a particularly remarkable growth rate, breaking through the 12 - billion - yuan market scale with a 10% growth rate. Different from American - style ice cream, Gelato is mainly made of milk, with low sugar and low fat. Many brands also promote the fact that they "use no water" as a selling point.

In addition, domestic ice cream brands such as Mr. Wildman and Bobbi & Ice are also expanding rapidly. According to Du Bin, the secretary - general of the Brand Professional Committee of the Shanghai Shopping Center Association, shopping centers have welcomed the entry of "Mr. Wildman" in the past two years.

Meanwhile, Häagen - Dazs has been quietly closing stores, including an old store in Beijing's Guorui and a store in Nanjing's Jiangning Wanda Plaza. Du Bin said that many Häagen - Dazs stores did not renew their contracts after the 10 - year term expired due to poor performance.

According to industry media "China Ice Cream", in January 2024, the number of Häagen - Dazs stores in China was 466. Data from Narrow Door Food Eye shows that as of June 20, before the publication of this article, the number of Häagen - Dazs stores in China was 385, far fewer than the 566 stores opened by Mr. Wildman and the 1695 stores of DQ.

"In terms of product taste, there is not much difference between current Häagen - Dazs ice cream and affordable ice cream."

Zhu Danpeng, an analyst in the Chinese food industry, told 36Kr bluntly that in terms of both taste and store service, Häagen - Dazs clearly lacks innovation, and its weak brand narrative can no longer attract the attention of young consumers.

As the ice cream market becomes more crowded, the emergence of new tea - drinking and domestic coffee shops has also provided consumers with more places for leisure breaks.

Against this background, Häagen - Dazs' original market share has been diverted.

General Mills' financial reports show that in recent years, Häagen - Dazs' performance in the Chinese market has declined, with sales shrinking from 800 million US dollars in fiscal year 2019 (from May 28, 2018, to May 26, 2019) to 730 million US dollars in fiscal year 2024.

How can old foreign brands save themselves in the era of cost - performance?

Häagen - Dazs is not the only brand having a tough time.

In March this year, Unilever split its ice cream business and established the "Magnum Ice Cream Company". It is understood that the reason for this split is that the ice cream business differs from Unilever's other businesses in terms of channels, profit structure, etc., and independent operation will help both parties achieve more efficient development.

Financial reports show that in 2023, Unilever's ice cream business declined by 6% year - on - year, and it decreased by another 1% in 2024. Unilever also mentioned in its financial report that due to the general market weakness, the Chinese market had declined. The split of "Magnum" by Unilever may also imply the future fate of Häagen - Dazs.

Objectively speaking, in the context of consumption segmentation, young consumers are increasingly pursuing "cost - performance" and are generally reluctant to pay for "ice cream assassins" with only a high - end title.

The latest survey by iiMedia Research also shows that consumers' consumption of ice cream has become more conservative: in 2025, only 6.94% of consumers will buy single ice creams priced over 20 yuan, and 77.39% of consumers prefer products priced under 10 yuan. In 2023, these two figures were 9.01% and 49.67% respectively.

The picture is from iiMedia Research.

As the high - end ice cream market continues to shrink, Häagen - Dazs is also trying to save itself.

At the end of 2024, Su Qiang, the vice - president of General Mills' international division, the president and managing director of the Chinese region, said in an interview with Top Digital that in the future, Häagen - Dazs will further expand its retail channels and focus on promoting hand - held products. To this end, the brand will also increase sales points and improve product display to make it easier for consumers to see and buy Häagen - Dazs products.

This move will undoubtedly increase Häagen - Dazs' exposure and competitiveness in the retail market. In addition to expanding retail channels, Häagen - Dazs is also attracting consumers through price cuts and promotions.

At the end of April this year, Häagen - Dazs set up a pop - up store in a Sam's Club in Shanghai, where consumers could choose ten flavors for 189.9 yuan. In some cities, Häagen - Dazs stores also launched a marketing campaign where consumers could buy a specified take - away classic coffee for 9.9 yuan.

It is worth mentioning that Häagen - Dazs' slogan has also changed to "Make every day extraordinary". Su Qiang said in a previous interview that with the change in the population structure, more and more consumers are paying attention to "self - indulgence", and Häagen - Dazs also hopes to develop the gift - giving scenario.

However, Häagen - Dazs still faces significant challenges under the siege of various competitors.

Since 2024, dairy giants such as Mengniu and Yili have been continuously adjusting their ice - cream businesses, and Renyanyangyitouniu and Feihe are also accelerating their layouts.

Objectively speaking, when the entire industry enters an era of low profit margins, reducing product prices can maximize consumers' willingness to buy. However, from the perspective of the long - term development of the brand, this move may still have an irreversible impact on the brand image.

Jeff Harmening also said that reasonable pricing is crucial but not the only thing. The company will also increase marketing investment. He further emphasized that "although the in - store retail sales of Häagen - Dazs in the Chinese market have continued to decline, the retail business has increased."

This may also mean that on the basis of maintaining the retail channels, selling Häagen - Dazs' store business in the Chinese market may not be a bad thing.

In the view of Zhang Yi, the chief analyst of iiMedia Research, Chinese consumers have more requirements for high - end catering - they need it to be green and healthy, and also have cultural connotations and social attributes. At present, Häagen - Dazs stores can hardly meet the new needs of consumers.

In contrast, after CITIC Capital became the controlling shareholder of McDonald's China, it launched the more localized "Golden Arches" era. On the other hand, Starbucks is also actively looking for a buyer for its Chinese business.

"If Häagen - Dazs can be operated by Chinese - funded institutions, it may be more 'down - to - earth' and better adapt to the situation of the Chinese domestic market." Zhu Danpeng believes that currently, Häagen - Dazs should quickly layout products in different price ranges, including high - end, mid - end, and mass - market products.

Du Bin also told 36Kr that Häagen - Dazs still has advantages but needs to make some adjustments, such as adding "grab - and - go" windows to existing stores or opening more small stores like DQ to deal with the current market dilemma.

As of the publication of this article, the stock price of General Mills, the parent company of Häagen - Dazs, has risen by 2.66%, with a cumulative decline of 14.88% this year.

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