Dannon responds to the U.S. yogurt boom
Dannon is committed to bringing products to market quickly. Fostering internal communication and outside collaboration with suppliers helps the yogurt processor achieve that goal.
The pilot plant’s location is another reason Dannon can speed development of new products and test and refine concepts. It made sense to house the production and marketing teams under the same roof, said Neuwirth. Dannon moved the pilot plant out of a processing facility in Fort Worth, Texas. The pilot plant, which is plant no. 1174 on the Interstate Milk Shippers List, includes processing and packaging lines. (See related article on page 44 about Dannon’s processing plant in Minster, Ohio.)
Dannon makes food and beverage products that are designed for various demographic groups and health needs, Fuster notes. The brands are:
- Danimals and Dan-o-nino yogurts and beverages appeal to children.
- Activia promotes digestive health.
- DanActive supports a healthy immune system.
- All Natural is made with natural ingredients in plain, coffee, lemon and vanilla flavors.
- Pure, made with seven to nine ingredients, is a new value brand.
- Fruit-on-the-Bottom is Dannon’s original cup-set yogurt.
- Light & Fit is a nonfat yogurt promoted for weight management.
- Oikos is a Greek-style yogurt.
Dannon launched Pure this year. The package touts “simple natural ingredients.” Depending on the flavor, the blended yogurt is made with seven or nine ingredients. The vanilla flavor contains milk, sugar, water, milk protein concentrate, corn starch, natural vanilla flavor and lime juice concentrate.
Dannon’s purchase of YoCream, Portland, Ore., in late 2010 gives it an entry into the frozen yogurt market and a push deeper into foodservice. YoCream is a maker of frozen yogurt mixes with live cultures that are sold to foodservice operators. The acquisition gets Dannon into another day part and channel, Valle said. Lopez-May noted that 50% of food is eaten away from home and that YoCream is the No. 1 player in stores. (Read more about YoCream in the June 2010 Dairy Foods or search online at dairyfoods.com.) At the National Restaurant Association show in Chicago in May, Dannon introduced two new products: a Greek frozen yogurt soft-serve mix and a ready-to-serve vanilla low-fat parfait that includes granola and a strawberry fruit blend.
Assessing the yogurt market
The yogurt category is dynamic, Valle said. The competition consists of big companies, including General Mills (Yoplait) and Agro Farma (Chobani). And the customers (retailers) are big companies (including Kroger, Supervalu and Safeway). In such a world, Dannon needs to be able to react quickly to customers’ needs and competitors’ actions, Valle told me.
The open office environment, the pilot plant and having suppliers in the headquarters helps. So does an entrepreneurial environment. “There are not many procedures at Dannon,” Valle said. He recalled that the executive team had a meeting about how to approach the Greek yogurt market in February 2011. By July 2011, Oikos was in the market and the product was advertised on television during the 2012 Super Bowl.
Dannon’s challenge is to make yogurt “relevant” to the U.S. consumer. Someone who eats yogurt three times a week is considered a heavy user, Valle said. He told me that he eats yogurt twice a day.
One way to increase consumption is to find other occasions for eating yogurt. By the way, milk processors also are trying to promote new usage occasions by positioning chocolate milk as a post-exercise recovery drink.
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