Yasso on track to hit $300m in sales in 2023, 'Without question this could be a half billion dollar brand or more,' says CEO
Up until a few years ago, Yasso was primarily a regional brand doing about 80% of its business in the Mid-Atlantic region.
When current CEO Craig Shiesley stepped in (who held leadership roles at WhiteWave Foods and Amplify Snacks previously) he saw the potential to make Yasso a national household name.
"What I saw was significant runway in terms of distribution and building household penetration behind the brand," Shiesley told FoodNavigator-USA.
"It just looked like without question this could be a half billion dollar brand or more with pulling the right levers for growth first starting with moving it from being a regional brand primarily out East to pulling it into national accounts in a more meaningful way."
'Novelties as a category plays well beyond dessert'
The most immediate and obvious course of action was to build its national distribution footprint and also embrace its position as a permissible snacking brand (vs. strictly a frozen dessert brand) through new product innovation in the frozen novelty category, which Shiesley argues fits into multiple dayparts beyond dessert.
"Novelties as a category plays well beyond dessert from post lunch to before dinner," he said.
To tap into what Shiesley calls that "mindless munching" occasion, Yasso developed new formats specifically targeting consumers' cravings throughout the day with its Poppable offering (chocolate-coated Greek yogurt bites), which the company launched in a small test market before deciding to go national later this year.
"What the Poppables platform is intended to do is offer more permissible indulgence but portion control and it pulls the eating occasion from dessert (to other day-parts)," said Shiesley.
"That’s what we’re trying to do with all the snack platforms is change the daypart and give the consumer more permissible snacking occasions that are better-for-you."
Better-for-you and uncompromising taste
Ultimately what makes the brand so appealing to consumers boils down to two simple attributes: uncompromising taste and a better-for-you nutrition profile, said Shiesley, who noted that Yasso core bars are all 100 calories or fewer with 5g of protein and lower sugar than conventional competitors. For its newer innovations, Poppables and Mochi, the calorie count is lower at 50 and 80 calories per serving, respectively.
"That’s the joy in the product. It’s not just the taste, but you’re doing it without sacrificing a lot of those really important health attributes," he said.
Incubate: Test, learn, then execute
A key to Yasso's strong growth has been its incubation approach, which is a test-and-learn strategy for the brand as it observes how the market responds to new products such as Poppables before deciding to go full force into a national launch, explained Shiesley.
"In our incubation, we’re optimizing pricing, we’re optimizing product, and package, so that we have a really strong foothold and strong velocities within the first 12-15 weeks so we can build out fast and continue to expand the innovation based on that strong early success," he said.
"What you’ll see launch nationally starting in December is all the learnings from that test market built into a full national launch of Poppables."
Household penetration and brand awareness
Looking at brand performance, Shiesley said while Yasso is pulling in impressive numbers both in terms of repeat purchase rates and consumer loyalty, the fact remains that not enough consumers know about the brand (yet).
"We have very low awareness of the brand right now of what we call unaided awareness in the low single digits," he said, noting that total household penetration (HHP) is about 5.5% and the goal for 2023 is to hit 8+%.
However, Yasso has already surpassed many ice cream and frozen novelty brands in the better-for-you set and has the potential to take share from legacy indulgent brands such as Häagen-Dazs, which has 12.1% HHP, Outshine (14% HHP), and Klondike (17.4%), said Shiesley.
"When we look at our total addressable market, however, there’s about 20-25 more points available to us.
"We have a lot of runway in total household penetration. With the right innovation and the right advertising there’s no question we can fulfill that aspiration."
According to Shiesley, the business is projected to grow between 30-40% over the next few years hitting $300m in retail sales in 2023 and then eventually $500m in a few years.
"What’s going to fuel that is going to be those snacking platforms and us really pushing the brand towards snacking platforms, moving beyond dessert and supporting that with a pretty aggressive advertising with what I call a challenger campaign," he said.
And while the company has had to take price on its products owing to recent significant cost inflation, the brand has not seen a downturn in consumer loyalty but rather a stronger allegiance to the brand, claimed Shiesley.
"Our larger consideration is the value we’re offering to customers. When you look at the other alternatives you can buy, we have a very strong value proposition of offering uncompromising taste in a better-for-you way," he said.
"We have not seen a category pull back, we actually see a category that is one the strongest-growing in all of grocery."