The milder tasting yogurts – which use different cultures to Chobani’s core Greek range and are flavored with fruit varietals such as Alphonso Mango and Monterey Strawberry – do not contain any high intensity sweeteners (Chobani’s Simply 100 range, which was sweetened with stevia leaf extract, monk fruit, and sugar, was discontinued in spring 2017).
Each 5.3oz cup contains 12g protein and 9g cane sugar, vs the 13-17g sugar in Chobani’s fruit-on-the-bottom and blended Greek yogurts, reflecting growing demand for less sweet options in the category that has helped drive sales of Icelandic yogurt (skyr) and prompted recent innovations such as Yoplait’s new ‘intentionally less sweet’ YQ line.
“The velocities of Hint are exceeding established low sugar brands, and the dollars per TDP [total distribution points] is very good, so it’s very productive on shelf, and consumer feedback has been very positive,” chief marketing and commercial officer Peter McGuinness told FoodNavigator-USA.
“This is also highly incremental... so it’s appealing to a low sugar consumer out there that didn’t like the current options for whatever reason [ie. bringing in new consumers to the category], or people are buying it in addition [to what they are already buying], so we’re seeing among our existing base people are buying the core products, Flip and Hint.
"They may want a low sugar option in the morning and something with a bit more sweetness in the afternoon.”
Chobani drinks deliver incremental growth
Chobani - which unveiled a new visual identity in November and grew its top line by 7% last year vs 2016 with double digit profitability growth – also saw an increase in household penetration following a product giveaway to celebrate its 10 year anniversary earlier this year, said McGuinness: “It was not inexpensive, but it paid off, as it raised our baseline essentially.”
Smooth – Chobani’s first foray into the non-Greek segment – originally launched in a two-pack, but has recently been relaunched as a single serve product, prompting an increase in trial and repeat sales, he said. “We’re committed to non-Greek and I think ultimately it will become a platform.”
Chobani’s drinkable yogurt is performing well and delivering incremental growth, he claimed: “People are drinking the drinks as well as spoonable yogurt; it’s a different need state and daypart and we’ll continue to innovate in this space.”
Flip continues to deliver for the brand, with more indulgent flavors such as strawberry rhubarb shortcake, S’more S’mores and Cookies & Cream doing particularly well, he said, while creamy flavors such as orange and cream are also doing well in the “strong and profitable” core Chobani range, which is being expanded to include more whole milk options.
The yogurt category: SKU proliferation, duplication, and irrational pricing
Asked about category trends, he said: “The category is volatile, but a lot of the wounds are self-inflicted, so you’ve got SKU proliferation, duplication, and irrational pricing. If you look at the category, there’s 829 SKUs out there and the average set has 475. Our average [retail] customer has 12-14 strawberry yogurts, and it’s just confusing the consumer.
“There’s a direct correlation between the number of SKUs and velocity declines and productivity declines, because [the category] is harder to navigate. The average yogurt consumer spends 20-25 seconds at the shelf, and if you’re hitting them with 20 different variants of the same thing, they get confused.”
As for duplication, he said, “A bunch of people coming out with imitation Flips is not category accretive, it’s not bringing new people in [although rivals note that Chobani was not the first to come up with a flip-type concept, which was first developed by brands including Fage and Muller, who both had products with yogurt and toppings in a separate side dish, although the latter was not a success in the US market].
Short term irrational pricing is commoditizing the food and sucking dollars out of the category
Asked about pricing, he said: “I think short term irrational pricing is commoditizing the food and sucking dollars out of the category, and we’re not going to get sucked into it.
"We’ll do 10 for $10 deals, but we’re not going to sell Greek yogurt for 67 cents. We have a line in the sand. If you look at the data, if you go that low, you’re not selling that much more.”