Dairy-free ice cream maker NadaMoo! closes $10m series B round, plans move into adjacent categories, says price increases are 'absolutely inevitable' in category
The coconut-fueled brand, which first launched in Whole Foods Market in 2005, is looking at “low hanging fruit” such as frozen novelties, said CEO Daniel Nicholson, but is also looking at “tangential categories centered on indulgence that are very complimentary to the frozen dessert category.”
The cash injection will also be used on “more aggressive marketing initiatives along with putting a lot more time and energy into product development,” Nicholson told FoodNavigator-USA.
Covid cuisine: ‘Our [plant-based] category has not fared as well as some of the more fully indulgent products’
As Dreyer’s Grand Ice Cream president Kim Peddle Rguem recently observed, it’s been an odd couple of years for ice cream, with plant-based and lower-calorie brands (which were outpacing the growth of more traditional products pre-pandemic) losing a bit of momentum as shoppers sought out more indulgent, comforting products, said Nicholson.
“What we have seen is that because our product and our brand proposition has always been one of a better for you offering with lower calories and lower sugar per serving, our category has not fared as well as some of the more fully indulgent products.
“But we don't believe that those trends will be sustainable over the longer term,” said Nicholson, who acknowledged that sales of NadaMoo’s ‘no sugar added’ line using allulose and erythritol had been “lighter than our initial expectations.”
He added: “In the short term, we do expect the space in the non-dairy frozen dessert category to continue to be tight and maybe even tighten up a little bit more, but there's an extreme optimism on our end that over the long haul, the healthier, more sustainable trends will rise back to the surface.”
Animal-free dairy
Asked about the emerging ‘animal-free’ dairy category, driven by brands such as Nick’s and Brave Robot, which utilize ‘real’ dairy proteins made by microbes instead of cows, he said: “I'm not personally aligned with that movement.
“However, I do think it's very interesting and it has an obvious appeal to the investment community. The difficulty in the food space has always been the fact that intellectual property is hard to come by in a recipe or formulation, so a food company that’s incorporating biotechnology into its formulation is able to achieve a much sweeter valuation, although it remains to be seen whether or not there will be a mass adoption by consumers.
“Ultimately, the consumer gets to decide what direction the market will move in.”
Digital marketing push: ‘We’ve gotten a lot more focused on data’
In 2022, NadaMoo! plans to spend more on digital marketing, said Nicholson, who said he had historically relied a lot on sampling and organic social media activities.
“Now we really believe that there are clear opportunities for us to leverage the strength of digital media and be better equipped to target consumers that are already shopping the category.
“The landscape is changing and brands are getting a lot much more aggressive with buying their way into the space, so it's important for us to dive deeper into our brand and ensure that the consumer understands very clearly what NadaMoo! is all about.
“We’ve gotten a lot more focused on data and on being able to more effectively pinpoint where our consumers are and how we can target them.”
Price increases ‘absolutely inevitable’
Asked about supply chain disruption and inflationary pressures, he said: “In our category in general, we haven't seen a lot of price movement just yet. But it is absolutely inevitable.”
