New flavors for made-in-Latvia ice-cream

RIGA - Even for a cool summer that has yet to catch its spark, more and more people are strolling around with ice-cream in their hands. What used to be an all-Latvian criterion, when choosing between so many options in the local supermarkets, now new market trends indicate a new style for Latvians raised on domestic cones and cups.

Made-in-Latvia, funded by foreign money
Ask any Latvian and you will hear that it is far from uncommon for locals to prefer homegrown products and brands, and ice-cream is no exception. Most consumers, when approaching supermarket freezers, tend to go directly for one of Latvia’s biggest brands, Rigas Piena Kombinats (RPK), or opt for other popular names that have heavily invested during the past decades to promote their domestic image.

“A Latvian origin of the ice cream has a strong value in consumer minds,” says Dmitry Dokin, head of the ice-cream segment of Food Union, a new company forming from two major Latvian producers, RPK and Valmieras Piens. When asked about the reasons behind the merger, he explains, “We built a new brand, Food Union, with an operating philosophy strongly relying on Latvian dairy industry traditions and innovative marketing solutions to provide a radically new offer on both Latvian and our export markets.”

“[The] ice-cream market [like the] dairy market itself is competitive, traditional, but still evolving with very competitive and convincing local brands,” Dokin further comments. Currently RPK has been exporting its products to Lithuania, Germany and Israel and is planning to gain a stable market share in Russia and CIS countries in the coming years.
The future will show if the local consumers will begrudge, or finally stop pointing fingers at, the origins of big enterprise shareholders and investors (RPK’s latest investor, Andrejs Beshmelnickis, has been declared the 137th richest man in Russia on the Forbes list), and enjoy the taste and quality of the products that are still made from Latvian milk.

Thinking outside the cone
Ice-cream is just the tip of the iceberg. Sister industries have been cropping up and opening their doors to consumers in Latvia. One prominent addition is YoYo frozen yoghurt. Recently, it has become one of Riga’s coolest attractions – especially for the diet-conscious – with three new locations around the city selling lower calorie treats. Customers mob its shops, winding around the self-service stations where soft-serve machines and bins of nuts, licorice, chocolates and other assorted toppings await.

The brightly colored shops were introduced only ten months ago by four partners of Icelandic origin, who have strong ties to Latvia. “We are only selling one product - frozen yoghurt - which seems quite popular,” says Peter Holm, one of the four owners. “We have our own local production of yoghurt, which is supplying the shops in the close-by area. This means that we are setting up a new production facility when we are going to new areas. The local production is based on local supplies, which means that our production in Riga is based on Latvian milk and other Latvian supplies.”
With an effective business model for production, and rising popularity judging from the daily traffic, Yo Yo seems to have hit upon a recipe for success. “Our advantage most likely is that we are offering a healthy product in an entertaining way in a highly designed and refreshing environment,” Holm concludes.

Finding the right spice
Another fairly recent, five-season-old and fast-growing addition to cold desserts comes from the small Latvian town Skriveri. Known for an innovative spirit and original recipes, Skriveri Home Ice-cream is made of all-natural ingredients with no added preservatives, offering a garden variety of fifty or so imaginative and artistic flavors, from basil, peppers, beer, black balsam (Latvian liquor made of herbs), cottage cheese or pumpkin, to even more unexpected choices like parsley and tomato sorbets.

Founded by two locals, Lelde and Martins Podnieks, the company’s avant-garde style for ice-cream has earned them a word-of-mouth reputation around the biggest cities. An unconventional approach to the ice-cream shop may help. In the Alberta street location in Riga, Skriveri holds an open house with magazine and poetry readings, and their Web site is full of other such ‘meetings’ and alternative-to-supermarket locations.

Reinventing an icon (with a little help from next door)
Two Baltic countries have taken their cooperation with neighboring countries to a new level, successfully utilizing the best of both sides of the border. The Estonian market leader Premia Foods, currently holding a 14 percent market share in Latvia, has partnered up with the local producer Laima to add value to the already famous chocolatier by producing interesting flavors of ice-cream that are sold under the Laima brand.

“Taking into account the rarity of qualitative ice cream, these are made from real cream, without the addition of vegetable oils. Now these three ice creams Serenade, Vaverite and Laima, made with real cream and chocolate, can be enjoyed fully,” described Dace Kokina, former marketing director of Laima, in 2011 when Laima first took up the idea.
Customer satisfaction and product quality were seemingly the main drivers for such a project. “This was an important aspect. While developing these products, technologists from both companies had to resolve a difficult situation – to integrate the rich taste and filling of Vaverite and Serenade candy into ice cream. This was accomplished through the modern technologies available at Premia,” said Kokina.

Laima is poised to introduce more ice-cream with new flavors in 2012. This may be coming on the heels of gaining a 2 percent market share for Latvian ice-cream since it got into the mix.
One concern was common to all those interviewed by The Baltic Tsimes. Company representatives universally expressed the desire to improve their flavors, designs and offers for both local and export markets. In Dokin’s words, “Competition is always good for consumers; it’s how they can always get the best product.”