The new packaging from Oikos
Danone North America
Oikos Greek yogurt launches this summer with a new look and formula as Danone North America aims to reignite the category.
According to Euromonitor International, the total value of the US market last year was $ 10.1 billion. With more than a third of the total market share, Danone is the top yogurt maker. Chobani, which helped make Greek yogurt a household name but has since expanded into other food categories, falls in distant second place with 19.1% of the market. (Chobani is considering an IPO later that year.)
“The category itself, pre-pandemic, has been relatively flat overall for several years. There was some acceleration during the pandemic, sort of a mid-single-digit rate of growth, but I think it’s fair to say it hasn’t accelerated “as much as some of our other segments,” said Shane Grant, Danone CEO North America.
Grant took over leadership of the division last year after serving as head of Coca-Cola’s Still beverages division. North America has become an increasingly important part of Danone’s overall business after the French company bought WhiteWave in 2017, roughly doubling its US business.
Danone’s strong influence on US yogurt consumers is largely due to its success in the wellness category with its probiotic yogurt Activia and the plant-based segment, which is currently by far the fastest growing segment of yogurt. Danone sells dairy-free yogurt under the Silk brand.
However, Greek yogurt, the largest segment in the yogurt category, is seeing much slower growth despite the fact that sales have increased due to the pandemic. In the 52 weeks ending May 29, total U.S. retail sales of Greek yogurt rose 4.6%, according to Nielsen. Two years earlier, sales of Greek yogurt had fallen 7.4% over the same period.
“While Greek has been pretty consistent, it hasn’t really been one of the real drivers of yogurt growth, at least not in recent years, and as we’ve seen, it hasn’t done it with enough enthusiasm from millennials,” Grant said.
Through several customer feedback rounds, Danone succeeded in reformulating Oikos Blended skimmed yoghurt with 50% more fruit and a creamier taste. It also left out the fruit at the bottom to blend it throughout the yogurt. The new packaging has a white background with bold letters.
Oiko’s blended yogurt hit grocery store shelves in June. It will be available nationwide by July, with a big marketing push from Danone.
And the timing is no coincidence either. Grant said a “good chunk” of yogurt consumption comes from consumers who take their yogurt pots from home while they are on the go. During the pandemic, these opportunities largely disappeared but were replaced by breakfast as many consumers worked remotely and started preparing their own breakfast for the first time in years. However, now consumers are more mobile as the states lift restrictions, and many employers are preparing to call their workforce back to the office if they haven’t already.
The rebranding and reformulation is the third step in Danone’s plan to strengthen the Oikos brand as part of its broader strategy to stimulate yogurt demand. It was reinvested in Oikos Triple Zero, which has zero fat, zero percent added sugar and no artificial sweeteners. Last year it launched Oikos Pro, which contains 20 grams of protein.
“We saw an opportunity here – because Greek is big, clearly the largest ingredient in yogurt – to bring measures to market that we believe can really revitalize that component of the yogurt market,” said Grant.