Tip Top's Eskimo Pies are to be renamed and rebranded due to the derogatory nature of the name, reports Stuff.
Tip Top plans to change the name and remove the Eskimo cartoon from the packaging of the chocolate-covered vanilla ice cream bars, which were first introduced to Kiwi consumers in the 1940s.
The ice cream itself is inspired by the blocks of an igloo and is named after the indigenous people of Alaska.
Companies around the world are making an effort to get rid of racist names and branding in the wake of the murder of US man George Floyd and the Black Lives Matter protests.
The Alaska Native Language Centre website states the name Eskimo is used in Alaska to refer to Inuit and Yupik people. But the name is considered derogatory in places such as Canada and Greenland as the term was invented by non-Inuit people.
Tip Top director Ben Schurr told Stuff: "We have been considering renaming this product and removing the Eskimo character from the packaging for a while now, so we're making plans to put the changes in place over the next few months."
Newshub reported earlier on Wednesday of Nestle changing the names of popular New Zealand lolly products 'Red Skins' and 'Chicos'.
The name 'Red Skin' is a derogatory term for Native Americans while 'Chico' is a racist slur against Latin Americans.
"These names have overtones which are out of step with Nestle values, which are rooted in respect. While new names have not been finalised, we will move quickly to change these names." Nestle said in a statement.
Tip Top's decision comes after another ice cream manufacturer, US company Dreyer, also pulled the plug on the racially charged name. Both Tip Top and Dreyer are owned by UK-based company Froneri.
Head of marketing for Dreyer's Elizabell Marquez told Stuff, "we are committed to being a part of the solution on racial equality, and recognise the term is derogatory."
Mars is looking at changing their 'Uncle Bens' rice packaging and Quaker Oats plans to get rid of their 'Aunt Jemima' pancake syrup, both due to racial stereotyping.