‘Amazing taste and texture, and unmatched nutritionals…’ Keto-friendly Nick’s Ice Cream on course to triple US revenues this year, expand into new categories

By Elaine Watson

- Last updated on GMT

'We are continuously optimizing our messaging for the right audience...' Picture credit: Nick's Ice Cream
'We are continuously optimizing our messaging for the right audience...' Picture credit: Nick's Ice Cream

Related tags Nick's Ice cream Perfect Day animal-free EPG Epogee

Swedish keto-friendly brand Nick’s – which entered the US in late 2019 with low carb light ice cream pints – is on course to triple its US sales in 2021 (vs 2020) with continued growth in bricks & mortar retail, sharp growth in its fledgling direct to consumer business, and moves into new categories, says US boss Carlos Altschul.

Nick's has taken off like a rocketship in the US as consumers seek permissible indulgences - products with fewer calories and low carbs, that still deliver on taste and texture - said Altschul, a dairy industry veteran who took the helm at Nick’s USA in January 2021.

We generated over $9m in gross sales last year - slightly less in net sales - and we are on track to triple that number for 2021 because we have amazing taste and texture, and unmatched nutritionals,"​ he told FoodNavigator-USA.

While Nick’s plays in multiple categories of the store in Europe​, including beverages, snacks and sweeteners, the US business initially focused on light ice cream, said Altschul. However, its keto-friendly bars (“they have​ the nutrition of a protein bar but taste like candy​”) – which launched direct to consumer at Nicks.com​ and will arrive at retail in due course – have been a big hit, while new ice cream sandwiches will come to the market shortly.

The bricks & mortar business is growing strongly, with 80% of retail partners increasing their SKU count during category reviews, and distribution growing from 3,500 stores at the end of 2020 to close to 6,500 today, said Altschul.

The subscription service now accounts for anywhere between 25 and 30% of our online business, depending on the month

However, the direct-to-consumer business, which has only been up and running for a few months, has been a runaway success story, he said, with distribution partner e-Tailer Inc – which handles ice cream distribution for multiple brands - claiming Nick’s notched up higher direct to consumer sales than brands such as Ben & Jerry’s and Häagen-Dazs in June.

It wasn't until the late summer that we found the right partner​ (e-Tailer) for the DTC business, but the repeat rates are 48%. And the subscription service now accounts for anywhere between 25 and 30% of our online business, depending on the month," ​said Altschul. "So this has now become a channel in which have been able to build one-to-one relationships with consumers.”

The Nick's brand resonates with shoppers at many levels, with buckets of consumers attracted to a range of attributes, from low calories to low net carbs or keto to particular flavors, said Altschul.

“It’s all about getting the right messaging in front of the right consumer, so we are continuously optimizing our messaging for the right audience. So in some cases, we are testing 30,40, even 50 types of messaging per week, as what is relevant or resonating one week might not be resonating two or three weeks later. So it's an ongoing process.”

EPG: Same taste, texture, a fraction of the calories

While light ice cream is a highly competitive segment, Nick’s stands out in part through its use of EPG​, a plant-based oil that has been restructured in such a way that virtually none of it is absorbed by the body.

The solid fat - listed on food labels as ‘EPG (modified plant-based oil)’ – contains 0.7 calories per gram (fat usually contains 9 calories), enabling significant calorie reductions (Nick's pints have 220-360 calories) without compromising on taste or texture, said Altschul.

Nick’s – which sweetens its products with a combination of allulose, erythritol, and steviol glycoside Reb M – has recently renovated its core range to further reduce net carbs, said Altschul, who said the brand’s keto-friendly credentials are attracting consumers, although it doesn’t reference keto on the front of pack.

Nicks vegan pints
Nick’s is one of a handful of brands pioneering a new ‘animal-free’ sub-category that utilizes ‘real’ milk proteins (from Perfect Day) that are produced by microbial fermentation instead of cows.Picture credit: Nick's Ice Cream

Animal-free dairy...

For its 7-strong vegan range,​ Nick’s is also one of a handful of brands (Graeter’s​, Brave Robot​, Smitten​) pioneering a new ‘animal-free’ sub-category that utilizes ‘real’ milk proteins (from Perfect Day​) that are produced by microbial fermentation instead of cows.

As no animals are involved in the production of the ‘non-animal whey protein’ in Nick’s frozen desserts - which started shipping direct to consumer in mid-December 2020 – it describes the products as vegan, although consumers with milk protein allergies are reminded that they contain milk allergens on the front of the pack, said Altschul.

The products - which claim to deliver the sensory experience of regular dairy ice cream with no lactose (as no milk sugar is involved), and no compromise – are performing well, although education is important at this early stage, he said.

We invested with our partner​ [Perfect Day] to drive awareness of what makes these products different​ [from, say, plant-based vegan frozen desserts] in that we have an animal-free dairy protein, so we can deliver the experience of a regular ice cream with better nutritionals and without the impact of dairy from a sustainability standpoint. We invested in that message and we saw a significant increase in interest and purchases of our vegan line as a result.”

While the notion of a vegan* product that contains dairy proteins is challenging for shoppers, consumers will get used to animal-free dairy as a concept as these ingredients become more widely used in the food industry, predicted Altschul.

“Our approach, which you can see in our campaign that we launched in April in May, was to be upfront about the fact that we’re using technology to deliver a full dairy ice cream experience in a product without the use of any animals.”

Allulose and erythritol in tight supply

Asked about tight supplies and high prices for certain specialty sweeteners​– particularly allulose and erythritol, which feature prominently in Nick’s products – he said:

We are one of the biggest buyers of allulose and erythritol across the country, but we have great relationships with our suppliers and we are leveraging those relationships to make sure we have uninterrupted supply and can mitigate some of these cost increases when it comes to passing them on to consumers."

* There is no legal definition of 'vegan' enshrined in US food law, so manufacturers make their own judgments or rely on 3rd party certifying agencies if they wish to adhere to a specific standard.  Nick’s says its products are vegan because the whey proteins it uses from partner Perfect Day are made “without the use of animals​​.” 

That is, although its whey proteins are identical to whey protein from cow’s milk, they are not derived​​ from cow’s milk, but made via microbial fermentation in a tank.

  • Read more about animal free dairy HERE​.

Nicks pints and bars

“In the history of shipping ice cream, we’ve never seen the growth that we’ve seen from N!CK’S. In the last six months, N!CK’S has caught up to brands like Ben & Jerry’s and Haagen Dazs and in the month of June, outpaced them.”

Steve Sauter, CEO, e-Tailer Inc. ​ Pic credit: Nick's Ice Cream

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