Although the Magnolia is already strongly represented by margarine, cheese and butter brands, sales of the ice cream brand lagged during the 90s, eventually leading to the company dropping it from shop shelves.
But with the continued presence of the brand in other dairy product formats, San Miguel says that the brand name carries tremendous strength, which, given the right marketing opportunities, could easily be turned into a success again.
In the Philippines, the Magnolia brand is by far the dominant player in the margarine segment, where the brand is claimed to have cornered 90 per cent of the market for non-refrigerated margarines and 80 per cent of the market for refrigerated margarines. Although the market for ice cream is much more competitive in the Philippines, the company still believes that the existing market dominance in the other segment will do much to strengthen the brand's chances of renewed success in ice cream.
San Miguel says that as a quality and totally dairy-based product, Magnolia ice cream is likely to be positioned at the upper end of the market. It will be relaunched in its classic flavours: chocolate, strawberry, sweet corn, vanilla, ube and mango, as well as the addition of new variations that will include ripple and fruit bits, gold labels rocky road, cookies and cream, dulce de leche and double dutch.
Although the company's domestic food sales have not performed with any gusto recently, sales of soft drinks and the company's own label San Miguel beer have helped to buoy results both in the domestic market and across the Asia Pacific region. At the beginning of this month, the company announced a 35 per cent increase in its consolidated operating income, to reach PHP 10.1 billion (€140m). At the time the company said that the performance was largely attributable to its Coca-Cola and beer sales.
However, reflecting a bullish attitude to the food market, the company announced a PHP 5 billion expansion programme for the expansion of its domestic food business at the end of last month. The investment will include the expansion of production facilities focused on the production of processed meats and flour milling.
San Miguel is one of Southeast Asia's leading food, beverage, and packaging company and the dominant player on the domestic market. But stagnant sales have led the company to look overseas in an attempt to reignite growth within the group. Currently it has over 100 major manufacturing facilities in the Philippines, China, Hong Kong, Indonesia, Vietnam, and Australia and its products are exported to over 40 countries throughout the world, but outside the Philippines, the San Miguel name is rarely attributed to anything other than its global brand, San Miguel Beer.