Greek yoghurt: an American success story


We have seen a peculiar phenomenon in the dairy world in the United States over the past five years: the Greek yogurt market has literally exploded in a short period of time. This thick yogurt owes its success to its nutritional qualities and its flavour, in a society which is constantly thinking about eating more healthily, but is not willing to compromise on taste.


In February 2012, Danone announced very satisfactory results for its US business unit, Dannon:

We have increased sales in the Greek yoghurt segment by 88% during 2011.

In just a few months in 2012, with its Oikos brand the company saw its share of the Greek yogurt market rise from 2% to 14%. Today, it hovers around 20% and Dannon is number 2 in the segment, behind the historical leader, Chobani. But this success story is not Dannon’s alone. The Greek yogurt market has tripled in the US. It is now the largest category, representing one third of the total yogurt market by value, and it all happened in just five years. Why is there such a craze over this thick, creamy yogurt, born in Greece centuries ago and introduced to the United States in 1998?


The success of Greek yogurt in three words

2008 saw a striking shift in culinary habits: American consumers, who are traditionally not huge yogurt fans (they eat six times less yogurt than the French each year), started to buy Greek yogurt on a massive scale. As a result, the value of the Greek market jumped dramatically, from less than US$100 million then to about US$2 billion today. Greek yogurt now accounts for about 35% of the yogurt market by value (as against 4% in 2008), and for basically all of the growth. Some might call it a revolution. A revolution that came as a surprise to some, since Greek yogurt is significantly more expensive than “classic” yogurt: three times the volume of milk is required to make it. This explains why Greek accounts for only 20% of yoghurt sales by volume but over a third by value. So, with price clearly not a factor, what makes American consumers chose this novel product? In three words,  it’s healthy, tasty and filling.

As « New Nutrition Business » magazine explained in July 2012,

what consumers want is value, and what the taste and texture and perceived health benefits of Greek provide adds up to good value.

In fact, the driving force behind Greek’s success is the fact that it combines three very important qualities. In terms of health, Greek yogurt contains almost no fat (mainly 0% and up to 3% on average) and is full of protein (10g per 100g on average). In terms of taste and texture, Greek is also unique and different from standard yogurt, and now offers a variety of flavours to pick from, and a thick texture that gives it a “fuller mouth feel” than regular yogurt – a capital asset in a country where people value pleasure and indulgence in food. Finally, Greek yogurt is filling, and that makes it consumable as a proper snack. In a country where yogurt used to be perceived as healthy but not that tasty, and as such was mostly purchased by weight-conscious consumers, the market took off when people realised they did not have to compromise on taste for health, and that they could have it all in a full snack or for breakfast. In fact, the Americans do focus a lot on indulgence and pleasure, but the spread of diet-related non-communicable diseases such as diabetes and obesity has also built a strong appetite for health. As food sociologist Claude Fischler explained in his latest book, « Manger. Français, Européens et Américains face à l’alimentation (Eat. The French, Europeans and Americans and their food) », after taste, Americans tend to focus a lot on nutrition and diet, with the underlying idea that everyone is responsible for their own body and must make the best choices to keep it in good condition. This double cultural tendency to value health and indulgence could well explain why Greek yogurt is experiencing such a success. Another of its benefits is also becoming key: it is perceived as very natural, and that helps support its growth in a society more and more concerned with the origin of foods and their impact on the environment and on the human body. Consumers instinctively link naturalness with positive health.

A potential to fulfil

For all these reasons, Greek is likely to keep growing in the near future:

A further 40% increase in Greek-style sales in just the next year and 120% over five years” is to be expected, wrote New Nutrition Business.

While an imagination competition to come up with the products that will seduce more and more customers is starting to develop, simplicity is still what works best for the most successful brands, which rely on the inherent quality and appeal of their products. In fact, the emotional dimension of Greek should not be underestimated: people are seeing something new and exciting happen in the yogurt section, something that everyone can enjoy (including men, who thanks to its taste and protein content no longer see yogurt as a “female only category”) and that has become very popular and highly valued. While yogurt has certainly not reached the royal status it has in the Netherlands (38.4kg per capita in 2011), France (35.6kg), or Germany (32.1kg), the destiny of Greek yogurt across the pond proves how much potential it has, in emerging as well as in mature markets. Because of its qualities, which are in fact not often found all combined in one snack, strained yogurt (high protein, low fat) could well give yogurt a new status in Europe, creating a new consumption habit, and making it somewhat different from a dessert. As we analysed in a previous article about the “ideal diet”, our Western, post-modern society is trying to combine everything in one meal: health, nutrition, respect for the environment… and of course pleasure. Health, taste and nutrition walking hand in hand, that has to do wonders.