Halo Top promises shoppers the indulgence of ice cream without the guilt, and millennials are eating it up. Literally.
The brand launched in 2012, but it did not explode until 2016. Halo Top has become one of the most Instagram-able products available in the frozen dessert aisle, with 28.8 million pints sold last year, generating $132.4 million in sales, according to data from IRI.
Halo Top's growth reflects shoppers' growing desire to shop for healthy, unique products from small brands. That's good news for brands like Halo Top, but that doesn't necessarily mean traditional ice cream brands are doomed — although they may need to play catch up.
Ice cream is still a profitable industry: last year, sales reached $6.6 billion, up 3.4 percent, according to Nielsen. But conventional products aren't necessarily driving the growth. While the sales for the whole category increased, sales of products that fit within the Food and Drug Administration's definition of "healthy" grew 85 percent last year.
"There's no turning back here. This is not a fad," said Jack Ringquist, principal and global consumer products leader, Deloitte Consulting. "This is truly an evolution that's occurring and (big companies) need to truly adjust to become positive players as opposed to resistors."
'Consumers are paying attention'
Small companies are driving growth throughout the food industry, according to research from Nielsen. Halo Top is leading the effort in the pint section of the frozen desert aisle. The brand is privately owned and is still run by Justin Woolverton, its 36-year-old founder.
Woolverton used to make ice cream for himself in his spare time. His hypoglycemia prevented him from eating store-bought ice cream because it was high in sugar, so he experimented with Greek yogurt and fruit.
He stumbled upon a cheap ice cream maker on Amazon and decided to test out a new recipe. When he tasted it, he had a "eureka" moment, knowing he had created something other people would want to eat. He convinced an ice cream factory to let him use their equipment and spent the next two years toying with the recipe when he wasn't working at a law firm.
Once Woolverton was satisfied with his product, he quit his job and focused on getting his ice cream, which was then called Eden Creamery, in stores around Southern California in 2012. After being sued for copyright infringement, Woolverton rebranded his product Halo Top.
He was sued again by another company in 2015. He was allowed to keep the name, but he had to change the packaging, which he considers a lucky break. The new packaging put its nutrition facts "front and center," prominently displaying the calorie count of the entire pint on the front of its cartons.
One-half cup of Halo Top's vanilla ice cream is 60 calories, while one-half cup of Ben & Jerry's ice cream is 250 calories. Woolverton knew the difference would be attractive to shoppers, but he did not realize how much it would drive sales. Customers may buy three or four pints at a time because it's lighter, so they may feel better about it eating it more often, he said.
"We built kind of a lifestyle ice cream that you can stock up in freezer," he said.
But Ben & Jerry's does not necessarily mind the difference.