How Danone North America is tapping into high protein and low sugar trends to grow yogurt sales
High-protein and low-sugar Greek yogurt is the key to dairy giant Danone’s North America growth plans.
In its July earnings report for the first half of 2024, Danone said that high-protein and plant-based products led growth. In North America, sales were up 5%, thanks in part to the growing popularity of the company’s Greek yogurt line Oikos.
Danone North America sells 11 yogurt brands, as well as other products like cold brew, creamers and plant-based products under various brands like International Delight, Silk and Stōk. Oikos — and its line with the highest protein content, Oikos Pro — is currently one of Danone North America’s fastest-growing lines. As such, the company said it will continue to accelerate with new variations of the Oikos Pro line, such as one that packs up to 25 grams of protein per serving.
Rafael Acevedo, president of the yogurt business at Danone North America, told Modern Retail the company is heavily investing in new yogurt recipes and formats to accelerate the portfolio growth.
Acevedo said that U.S. consumers are increasingly seeing the benefits of yogurt, such as high protein content and low sugar. “We’re seeing those are two areas that are helping us drive a lot of the growth for our brands,” he said. Gut health is another rising wellness trend on social media that lends itself to yogurt.
Moreover, Acevedo said, “Yogurt is becoming more versatile.” That is, people are considering yogurt beyond an on-the-go breakfast food and for different occasions, such as using it as a healthier ingredient swap in cooking. “Consumers are moving away from having a full breakfast and snacking on-the-go throughout the day,” he said.
These shifts prompted Danone North America to develop new formats to better serve busy lifestyles. “For example, we just rolled out Oikos Pro drinks and shots, and that’s on fire right now,” Acevedo said. Oikos Pro, in particular, is currently helping drive the parent company’s sales. “With Oikos, this is a brand that’s growing more than 40% in retail dollar sales,” he said.
Another yogurt line that Acevedo says has high growth potential is Too Good, which launched in 2019. It’s a low-sugar Greek yogurt that contains no added sugar. Its name derives from the fact that it has just two grams of total sugar per cup.
“We just introduced Too Good Zero Sugar in the U.S., and we’re already starting to see velocities ramping up,” Acevedo said.
Still, with so many Greek yogurt options available on the market, Acevedo said the company is trying to differentiate Oikos’ branding and positioning.
“Oikos has broken some conventions in the yogurt category,” he said. For example, Oikos opts for all-black packaging in order to stand out from the sea of white yogurt containers on the shelf. “We’ve also strategically associated Oikos with athletes to showcase it as a performance brand,” Acevedo said. Earlier this year, the brand’s “Hold my Oikos” Super Bowl ad featured ESPN host and former NFL player Shannon Sharpe with actor Martin Lawrence.
Kantha Shelke, a trendspotter on behalf of the Specialty Food Association, said that “high-protein foods are surging in popularity because of their health halo and the universal recognition of protein as essential and better-for-you. “Diet trends like paleo, keto and veganism are driving the focus on protein-rich foods,” she explained.
Shelke noted that, unlike other macronutrients, protein has consistently maintained a positive health perception over the last few decades. Danone’s Oikos and Too Good are part of a growing cohort of brands capitalizing on the protein everything craze. “People have more options today with plant proteins on the rise and in practically every food category,” Shelke said.
Acevedo also said he sees more yogurt snacking format opportunities on the horizon, especially with the rise of weight loss drugs changing eating habits. GLP-1 medications are helping boost new categories for CPG giants, with those taking the injections looking for light, healthy meals to eat on a curbed appetite. Oikos bottled yogurt drinks and shots are some examples of ways that Danone will try to cater to these occasions, Acevedo said.
With more new products in the pipeline, Acevedo said, Danone North America is hoping to bring in more younger consumers into the fold. “We’re trying to shape the culture of yogurt with the functional benefits, but also with products that deliver on taste,” he said.