THE YOGURT MARKET AND YOGURT INNOVATION:GREEK YOGURT AND BEYOND

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About The Author

George Puro

George Puro is the principal of the Puro Research Group, a market intelligence firmspecializing in quick-turnaround insights and analysis. Mr. Puro has provided aha! insights to clients through more than 6,000 custom reports on a wide range of industries and consumer segments. Projects have included consumer and association member surveys, broad industry reports (e.g., the tea industry in the U.S), target markets (Hispanics and candy consumption), trending topics (vampires in pop culture) and obscure details (most common color of a dress shirt button). Mr. Puro has previously worked at ORC International (formerly known as Find/SVP), the National Hockey League, Citi, The Sporting News, and ESPN.com. Mr. Puro has a BA from The University of Chicago and an MBA from Washington University in St. Louis (Olin School of Business).

The Yogurt Market and Yogurt Innovation:

Greek Yogurt and BeyondThe yogurt market has undergone a sea change due to the Greek yogurt counter-revolution, which has yanked the category back to the future. Packaged Facts estimates the U.S. retail market for yogurt at $7.3 billion in 2012, up 6.6% over the previous year—with the Greek yogurt segment singlehandedly responsible for these respectable sales gains in a very large and mature product category. Greek yogurt surged from being from just a sliver of the yogurt market in 2007 to becoming the most important trend in the industry, albeit at the expense of non-Greek yogurt dollar and unit sales.

While Greek yogurt will continue to post gains and set the direction for the overall yogurt market, Packaged Facts does not believe it can keep up its amazing growth pace. As of early 2013, price competition has caused some areas of sales growth to slow, and major players to fight a zero sum game over market share.

Even so, many industry watchers hold that that yogurt, which is consumed at a relatively low rate per capita in the U.S., still has significant upside on these shores. With yogurt growing in consumption across various dayparts, and with the broad-ranging push for healthier eating and increased consumption of lean protein in the U.S., growth in the yogurt category is hardly on its last legs.

Executive Summary - Scope of the Report

This report examines the market for yogurt and yogurt drinks, both across the U.S. retail spectrum and worldwide. All retail channels are included in the sales quantification, with discussion focusing on supermarkets and grocery stores, convenience stores, supercenters/mass merchandisers, natural food and gourmet/specialty food stores, and warehouse clubs.

While the report does discuss yogurt in other forms (such as frozen yogurt, yogurt dips, snacks, etc.) and in other venues (such as sales in foodservice channels), the primary focus of the report is refrigerated yogurt and yogurt drinks at retail.

Executive Summary - Report Methodology

The information contained in this report was obtained from primary and secondary research.

Primary research entailed consultations with yogurt market sources, on-site examination of retail venues, and fielding a proprietary Packaged Facts online consumer survey focusing on yogurt product shopper insights.

Secondary research included extensive Internet canvassing and research- and data-gathering from relevant consumer business and trade publications; company reports including annual reports, press releases, and investor conference calls; company profiles in trade and consumer publications; government reports; and other food and beverage market reports by Packaged Facts.

Table 1-1 U.S. Sales of Yogurt, 2008-2012 (in millions of dollars)

Source: Packaged Facts

Year Sales (in millions) % Change

2012 $7,295 6.6%

2011 $6,817 9.0%

2010 $6,203 7.9%

2009 $5,716 3.6%

2008 $5,511 8.0%

Chapter 1 - Size & Growth of the Market

Source: Packaged Facts

Chapter 2 - Market Trends

Yogurt is a dynamic category in the United States continually marked by innovation and reinvention. The category has seen a monumental transformation in the last few years.

Dollar sales for yogurt, long dominated by brands such as Dannon and Yoplait, have shot up in the last five years, jumping 32% in the last five years alone. At the same time, unit sales have increased much more modestly, in the 7-8% range over the last five years.

Source: Packaged Facts

Chapter 3 - Greek Yogurt & Beyond

Greek yogurt is sourcing some of its growth from other categories across the grocery store. That growth is affecting deli-prepared meals, like soup and salad bars. People running in to grab lunch in the middle of the day are increasingly buying Greek yogurt, because of its high protein content, to replace those items. And it's affecting center-store items like soup and frozen meals, too.” (Star-Ledger, May 2012)

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Source: Packaged Facts

Chapter 4 - The U.S. Market: Marketer Profiles

Chobani, Inc.

When one thinks of America’s fastest growing businesses, one usually thinks of a bleeding edge new technology company that might be headquartered in Silicon Valley. Or a company that tries to reinvent how we shop locally, such as daily deal site Groupon.com. A yogurt manufacturer isn’t what would come to mind. Yet Chobani Inc., which was founded in 2005, has quickly turned the yogurt industry on its head, while becoming one of the fastest growing businesses in all of U.S. industry.

Source: Packaged Facts

Chapter 5 - The Global Market

Yogurt Sales at $69 Billion Worldwide

Table 5-1 Share of Yogurt Sales by Region, 2012 (percent)

Source: Packaged Facts

Chapter 6 - The Consumer

Packaged Fact’s analysis of consumer demographics for yogurt products draws on Simmons’ Fall 2012 National Consumer Study, which is based on 25,564 adult respondents surveyed from October 2011 through November 2012, as well as previous-year Simmons surveys, through telephone interviews and mail-in booklets. This survey measures household usage of standard yogurt brands. The discussion also relies on Packaged Facts’ online consumer survey of 2,000 U.S. adults, which was conducted in February/March 2013.

Table of Content Highlights

Yogurt Sales Bloom, Thanks to Greek

Yogurt is Bought In a Variety of Retail Outlets

Yogurt Sales Rise to $7.3 billion

Greek Yogurt Fueling Dollar Growth, but Cannibalizing Unit Sales

Market Share Concentrated Among a Select Few

Greek Invades Frozen Yogurt

New Products and Trends Around the World

Yogurt Percentage Usage Holds Steady; Per Capita Consumption Increasing

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