Core Viewpoint - Häagen-Dazs is facing unprecedented challenges in the Chinese market, including store closures and declining sales, leading to speculation about a potential sale by its parent company, General Mills [3][4][5]. Group 1: Current Situation of Häagen-Dazs - Häagen-Dazs has closed several stores in major cities like Beijing, Shanghai, and Dalian, reducing its presence from over 400 stores to around 250 by June 2025, nearly a 50% decrease [7]. - The chairman of General Mills acknowledged a double-digit percentage decline in customer traffic for Häagen-Dazs stores in China, indicating a tougher consumption environment [7]. - In the third quarter of fiscal year 2025, General Mills reported net sales of $4.842 billion, a 5% year-over-year decline, with a 3% drop in the Chinese market [7][9]. Group 2: Market Dynamics - The ice cream market in China is undergoing significant changes, with local brands gaining popularity due to better alignment with consumer preferences and competitive pricing [10][12]. - DQ has rapidly expanded its presence, increasing its store count by nearly 800 since 2020, reaching 1,721 stores by April 2025 [12]. - New domestic brands like Gelato and Bobo Ice Cream are capturing market share, with Gelato projected to reach a market size of over 12 billion yuan by 2024, growing at a rate of 10% [13][15]. Group 3: Challenges and Competition - Häagen-Dazs faces intense competition from various sectors, including established dairy companies and new entrants from the restaurant industry, all vying for a share of the lucrative ice cream market [17][20]. - The brand's high pricing strategy, once a symbol of luxury, is now seen as a disadvantage as consumers shift towards more affordable and locally appealing options [22][29]. - Häagen-Dazs has attempted to innovate and adapt by introducing new flavors and products, but struggles to keep pace with the rapid innovation of domestic competitors [25][27]. Group 4: Consumer Perception and Brand Positioning - The brand's previous image as a luxury product has diminished as consumer preferences evolve towards value and local products, leading to a loss of its "high-end" appeal [29]. - The shift in consumer behavior reflects a broader trend where younger generations prioritize personal satisfaction over brand prestige, challenging Häagen-Dazs's traditional marketing strategies [29].

Core Insights - General Mills is considering selling its Häagen-Dazs ice cream stores in China, with a potential sale process expected to start within the year, aiming for a price in the hundreds of millions of dollars, although negotiations are still in the early stages and may not result in a sale [1][2] - Häagen-Dazs has experienced a significant decline in customer traffic in China, with reports indicating a double-digit drop, leading to the closure of several underperforming stores [2][4] - The brand's market position has weakened due to changing consumer preferences and increased competition from domestic ice cream brands that offer lower prices and a focus on fresh, handmade products [8][12] Company Performance - As of January 2024, Häagen-Dazs had 466 stores in China, but this number has decreased to 263, indicating a significant reduction in its retail presence [2] - The company has attempted to adapt by expanding its sales channels and implementing price reductions, with notable discounts on products sold through convenience stores and e-commerce platforms [5][7] - Despite some growth in specific product lines, overall net sales in the Chinese market fell by 3% year-on-year in the third quarter of fiscal year 2025 [7] Market Dynamics - The competitive landscape in the Chinese ice cream market has shifted, with domestic brands like Bobo Ice and Romanlin gaining traction by offering products at lower price points, typically between 10-20 yuan [8][12] - These domestic brands have rapidly expanded their store counts, with Bobo Ice reaching over 1,200 locations and Romanlin opening more than 140 stores in the first half of 2025 [10][12] - Additionally, tea and coffee brands are entering the ice cream market, leveraging their existing customer bases and offering products at competitive prices, further challenging Häagen-Dazs' market share [12][13]