Mixed bag

Dairy Field, Aug 2003 by Cook, Julie

Yogurt continues to enjoy strong consumer demand, while cottage cheese struggles to stay afloat.

From kid-friendly products, like Yoplait's Go-Gurt, Stonyfield Farm's YoBaby and Dannon's Danimals to such adult-oriented fare as Dannon's la Creme, Yoplait's Whips and Old Home Foods' Velvet Delight, yogurt processors have been vigorously flexing their R&D muscles in recent years. And their efforts are paying offin spades. According to data from Chicago-based Information Resources Inc. (IRI) for the 52-week period ending April 20, 2003, dollar sales of refrigerated yogurt soared 10.7 percent, while unit sales kept pace, rising 9.7 percent in supermarkets, drug stores and mass merchandisers, excluding Wal-Mart.

That dedication to innovation has proven key in driving year after year of growth, according to Gary Hirshberg, president and chief executive officer, Stonyfield Farm, Londonderry, N. H. With so many forms and flavors of yogurt on the market today, consumers find themselves fitting yogurt into more and more eating occasions.

"Whereas people previously might have had yogurt only a couple times a week, now they are having it a couple times a day," says Hirshberg. "If you have yogurt with some granola or cereal in the morning or maybe i yogurt with a salad at lunch, now you've got a late night, kind of indulgent fix that's not nearly as heavy as ice cream."

The yogurt industry has also helped itself tremendously by improving the taste and mouth feel of the product over the years, points out Hirshberg, adding that such improve- ments have made the product more palatable to men and other non-traditional yogurt eaters. What's more, medical professionals have begun recommending yogurt for s people with an assortment of health problems. "I remember the days when the only people really interested in yogurt were women because of yeast infection prevention," Hirshberg recalls. "Now, athletes who are getting broken bones and stress fractures are being told to eat yogurt to get more calcium."

That's not to say that yogurt has reached its peak by any means. Across Canada and the United Kingdom, per capita consumption stands at 10 to 15 pounds, according to Mark Sugden, senior category business director, Kraft Foods, Northfield, III. In certain European countries, that number reaches as high as 30 pounds, while U.S. per capita consumption remains at just 5.4 pounds.

That could change in a hurry if American con- sumers warm up to smoothies and other drinkable yogurts the way their overseas counterparts have done. In Europe and Latin America, Hirshberg claims, yogurt drinks occupy as much as 50 percent of the category's cooler space.

Numerous U.S.-based processors have tested the yogurt smoothie waters in years past, consumers never seemed to embrace pre-packaged, storebought smoothies, preferring freshmade product instead. Within the past couple of years, however, smoothies and drinkable yogurts have hit the retail dairy case with a vengeance, as a number of players, including Yoplait, Dannon, Stonyfield Farm and Old Home Foods, have rolled out such products. Early indications are that Americans are indeed responding to the latest wave of retail smoothies, as sales of refrigerated smoothies soared 51.8 percent in dollars and 65.9 percent in units this past year.

So why have retail smoothies taken off so well this time around when they proved to be a resounding failure just three or four years ago? Dave Holdsworth, vice president of sales and marketing for Old Home Foods, St. Paul, Minn., says it was a matter of adjusting the taste to please American consumers. "When the first smoothies started coming out, the European taste really didn't play well with the American palate, and it really took a while to evolve," he says. "Over the past few years, with the research and the testing, people started to hit on better tasting products that consumers like."

Among those products has been the Old Home Smoothie, a yogurt-based product containing real fruit, rather than juice. Doug Pritchard, marketing manager for Minneapolis-based Yoplait USA, reports strong consumer response to his company's Nouriche product, which he describes as "more than a smoothie" because it provides the nourishment of a full meal. Likewise, Hirshberg reports continued growth of its Drinkables yogurt, an organic product containing inulin, a natural dietary fiber clinically proven to help boost calcium absorption.

Among the top 10 yogurt processors, Stonyfield Farm experienced the strongest growth, rising 25.2 percent in dollars and 18.6 percent in units. Hirshberg hopes to further boost sales with the introduction of Moo La La, a line of dessert yogurts, this fall. Sold in four-packs of 4-ounce cups, Moo La La will be available in Chocolate Under Chocolate, Strawberry Cheesecake, White Chocolate Raspberry and Lemon Chiffon. According to Hirshberg, Stonyfield Farm has been extra vigilant in testing the product because it will be going up against Dannon's popular la Creme product. "We have been testing the product a little bit more than usual to be sure that there was a unique taste delivery and that we succeeded in getting those benefits across," he says. "I'm pleased to report that the consumer just gets it."