Positive Reviews: Häagen-Dazs’ high-end brand building was once an industry benchmark, and its historical accumulation still holds potential value
Häagen-Dazs’ early success in the Chinese market was a textbook case of foreign brands’ high-end localization. When it first entered China in 1996, the price of a single scoop at 25 yuan far exceeded the average monthly salary of workers at that time (about 500 yuan). However, it precisely captured consumers’ pursuit of “foreign brands” after the reform and opening up and the “status symbol” needs of the emerging middle class. Through the red and gold store decoration, emphasis on imported ingredients (such as premium milk and Belgian chocolate), and emotional marketing of “love” and “romance” (such as the classic slogan “If you love her, take her to Häagen-Dazs”), Häagen-Dazs successfully upgraded ice cream from a “summer snack” to a “ritual consumption” and even became a “standard scenario” for young people’s dates and anniversaries.
This positioning strategy was strongly validated by the market from 2006 to 2015. The compound annual growth rate of its sales in the Chinese region reached as high as 23%. In 2017, it reached the top with “half of the global market share”. The scale of more than 400 stores (accounting for over 60% of the global total) became the core fulcrum of its global strategy. The success during this period not only brought substantial profits to General Mills but also established Häagen-Dazs’ “mental monopoly” position in the high-end ice cream market in China. For a long time, “high-end ice cream = Häagen-Dazs” was almost consumers’ intuitive reaction.
Even in the current predicament, Häagen-Dazs’ brand assets have not completely dissipated. The uniqueness of its store scenes (one of the few ice cream chain brands that provide seats and are suitable for socializing), consumers’ remaining trust in “imported ingredients”, and the emotional memories of early users (such as Liu Xing’s lines in the TV series Home with Kids becoming a childhood symbol for a generation) still leave some room for brand premium. If it can effectively activate this historical accumulation during the transformation, Häagen-Dazs still has the opportunity to find new growth points in the segmented market.
Negative Reviews: Lagging innovation and unbalanced positioning have put Häagen-Dazs in an awkward situation of being neither high-end nor mass-market
Häagen-Dazs’ decline is essentially a typical lesson of a brand strategy failing to adapt to market changes. Its problems can be summarized as “three major disconnects”:
Firstly, product innovation is disconnected from consumer needs. The current ice cream market has entered the era of “experience consumption” from “functional consumption”, and consumers’ requirements for taste, ingredients, and health attributes have significantly increased. However, Häagen-Dazs’ product line has been stagnant for a long time. The official mini-program shows that there are less than 20 core single-scoop ice cream products, and the flavors are limited to traditional choices such as chocolate and vanilla, which have been criticized by consumers as “unchanged for a decade”. In contrast, DQ offers 28 varieties in 5 categories for personalized customization. Bobbie’s Creamery has expanded rapidly with its “milk ice cream”, and Mr. Wild Man with its “pistachio specialty”. Moreover, the “poor man’s ice cream” (2 yuan per piece) of Mixue Ice Cream & Tea has captured the mass market with its extreme cost-effectiveness. Häagen-Dazs has neither launched disruptive innovations in the high-end line (such as low-calorie and organic health concepts) nor attracted trial users in the mass market by enriching SKUs. The weak product strength has directly led to the loss of customer flow.
Secondly, price positioning is disconnected from consumer perception. Häagen-Dazs’ “high-end filter” has been completely broken in the era of information transparency. Consumers have found through overseas shopping and travel that it is often promoted at a low price of 1 US dollar in American supermarkets, which forms a sharp contrast with the price of 40 yuan per small cup in the Chinese market. According to the 2022 – 2027 China Ice Cream Industry Market Panorama Research and Development Prospect Forecast Report, consumers’ acceptable price range for a single ice cream is mainly between 3 and 10 yuan (accounting for 70.9%), and only 1.8% can accept prices above 20 yuan. Häagen-Dazs’ high price far exceeds the mainstream consumption expectations, but it fails to provide sufficient “high-end value” (such as limited editions, handmade products, and exclusive ingredients) to support it. Although its 50% discount promotions in recent years (such as the special price of 21.9 yuan on third-party platforms) have attracted customers in the short term, they have further blurred the brand positioning, falling into a vicious cycle of “lowering prices harms the brand, and not lowering prices leads to no sales”.
Thirdly, the channel strategy is disconnected from the market structure. Häagen-Dazs initially relied on the heavy-asset model of “specialty stores + high-end shopping malls” to build its brand image. However, with the rise of new channels such as convenience stores and e-commerce, its channel coverage has seriously lagged behind. Although it started to enter convenience stores like FamilyMart in 2016, compared with DQ’s 1,721 stores, Bobbie’s Creamery’s more than 1,000 stores, and Mixue Ice Cream & Tea’s tens of thousands of stores, Häagen-Dazs’ 263 stores are not dense enough to reach the mainstream consumption scenarios. At the same time, under the pressure of a double-digit decline in passenger flow, the contradiction between the high cost (rent and labor) and shrinking revenue of the heavy-asset store model has become increasingly acute, ultimately forcing the brand to shrink its front line (such as the closure of the Guorui store in Beijing and the Parkson store in Nanchang).
In addition, the impact of the healthy consumption trend cannot be ignored. When “more additives than life” has become a common complaint about traditional ice cream among consumers, Häagen-Dazs failed to launch healthy products with “less additives” and “low sugar” in a timely manner. Instead, it was questioned for “excessive marketing” due to its ingredient promotion (such as “imported”), which further weakened users’ trust.
Advice for Entrepreneurs: Key Elements for Long-term Brand Survival from Häagen-Dazs’ Rise and Fall
The case of Häagen-Dazs provides multi-dimensional inspiration for entrepreneurs, which can be summarized into the following four key points:
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Product innovation is the “lifeline” of a brand, and a continuous iteration mechanism needs to be established
Häagen-Dazs’ decline started with the stagnation of its product strength. Entrepreneurs should realize that consumer demands (especially the taste, health, and personalized needs of young people) change extremely fast. They must establish a product R & D system of “rapid trial and error and high-frequency iteration”. For example, they can capture trends (such as low-sugar and Chinese-style flavors) through user surveys and community feedback, and regularly launch limited or customized products to keep the products fresh. At the same time, they should avoid the mindset of “relying on one product forever”. Even classic products need to be optimized according to market feedback (such as adjusting the sweetness and adding new ingredients). -
Brand positioning needs to be dynamically calibrated to avoid the blurring of “high-end” and “mass-market”
Häagen-Dazs’ awkward situation stems from the confused positioning of being neither high-end nor mass-market. Entrepreneurs need to clarify the core value of their brand (such as high-end experience, extreme cost-effectiveness, and health attributes), and design pricing, channel, and marketing strategies around this value. If choosing the high-end route, they need to strengthen the “high-value perception” through exclusive technology, scarce ingredients, or unique services (such as handmade products and scenario-based experiences). If targeting the mass market, they need to establish advantages in cost control (such as supply chain optimization) and channel coverage (such as convenience stores and e-commerce) to avoid losing users’ trust due to overpricing. -
Channel layout needs to match consumption scenarios and transform from heavy assets to “omni-channel integration”
Häagen-Dazs’ heavy-asset store model has shown its vulnerability in the new consumption era. Entrepreneurs should break the inherent thinking that “offline stores = brand image” and build an omni-channel network of “online + offline”, “specialty stores + convenience stores + e-commerce”. For example, offline stores can focus on experience (such as providing seats and theme check-ins), online channels (such as mini-programs and live broadcasts) can focus on sales and user interaction, and convenience stores can cover daily consumption scenarios. At the same time, they need to dynamically adjust the store scale according to passenger flow data (such as closing inefficient stores and opening pop-up stores) to reduce the pressure of fixed costs. -
User perception management needs to be “consistent inside and out” to avoid trust collapse caused by information gaps
The breaking of Häagen-Dazs’ “high-end filter” is essentially the disconnection between brand promotion and users’ actual experience (such as the comparison between the low price in the United States and the high price in China). Entrepreneurs need to attach importance to “user perception management” to ensure that brand promises (such as ingredients, craftsmanship, and services) are consistent with the actual experience. They can enhance trust through transparent marketing (such as showing the supply chain and production process), and pay attention to users’ feedback on social media, responding to doubts in a timely manner (such as explaining the pricing logic and emphasizing local costs) to avoid the accumulation of negative word-of-mouth.
In conclusion, Häagen-Dazs’ rise and fall confirm the cruel law of the consumer market: there is no permanent “high-end”, only “value” that continuously meets users’ needs. For entrepreneurs, only by maintaining a keen insight into the market, an extreme pursuit of products, and a dynamic calibration of brand positioning can they achieve long-term survival and growth in the fierce competition.
