Lovin’ spoonfuls
It’s a happy time for yogurt sales. Consumers are pushing sales into record territory. A report from Innova Market Insights estimates the global market for yogurt (both dairy and non-dairy) would exceed the US$100 billion mark in 2021, for the first time.
According to the latest stats provided by NielsenIQ, sales of yogurt in Canada have reached almost $1.7 billion, representing a 4% increase between December 2020 to December 2021.
What’s behind the uptick? “Yogurt fits well with a healthy regime,” says Sylvain Charlebois, senior director of the Agri-Food Analytics Lab at Dalhousie University. “Gut health is increasingly becoming a focus for a growing number of people, which is why the category has potential for growth. And we’ve seen interesting innovations in the category keeping consumers engaged.”
One such innovation is non-dairy yogurt. Going forward, it’s a sector that holds “great potential,” since regular yogurt will become more expensive in the months to come as the cost of milk production increases, notes Charlebois. That will push consumers to look for alternatives. He says grocers need to maintain decent traffic in the dairy aisle. “Better merchandising and promotional strategies will go a long way.”
Yogurt has been used as a loss leader by some retailers, underscoring the importance of pricing. “The best thing that the big brands can do to help us sell their yogurt is to help lower our costs to allow us to sell the product for a more competitive price since many types of yogurt are very price sensitive,” says Nigel Oliver, management team member at Ontario’s Vince’s Market. Oliver also suggests that premium and lesser-known brands should offer shelf talker-type materials to educate customers on product benefits.
Giving consumers new reasons to buy yogurt keeps sales robust. When it comes to innovation, plant-based yogurts are out front with double-digit growth. Ontario’s Simpla Foods is a newcomer in that space. “We started the business because we couldn't find a plant-based yogurt in Canada made without additives, gums and preservatives,” says Ari Davis, the company’s co-CEO. “Simpla is made with the simplest organic ingredients, without preservatives and no added sugar. We believe our customers should know what they’re eating.” Later this year, Davis says the company will roll out a new plant-based yogurt featuring regeneratively-farmed organic oats.
Retailers are on board the plant-based train, too. “In 2022, we will keep focusing on non-dairy alternatives, such as Riviera coconut milk-based yogurts and kefirs,” says Nathalie Coutayar, marketing merchandising manager at Denninger’s Fine Foods in Ontario . Full-fat options are also strong sellers, largely driven by keto diets. Coutayar says yogurt producers can help support retailer sales with fair specials among grocery banners and by offering a full return program for perishable items, like yogurt.
Big players are also evolving their yogurt rosters, including Quebec’s Maison Riviera. “In the last couple of years, we have focused on the most popular and mainstream segments of yogurt such as Greek and plant-based products,” says Jennyca Perrot, brand manager at the company. “Fresh dairy products are constantly evolving, keeping pace with the changes and trends of our consumers.” She also credits the emergence of flexitarianism and eco-responsibility, as well as a focus on local and healthier products for yogurt’s sustained strength.
Danone Canada’s diverse portfolio of dairy and plant-based yogurt brands continue to be in high demand. Iannick Melançon, senior vice-president, sales, Danone Canada, predicts strong growth over the next couple of years. The company’s 2021 Usage & Attitude study show people consume yogurt for three main reasons: health, taste and texture, and convenience (ease of getting nutrients, like calcium and protein). “Whenever we come up with a new product, we always keep these in mind,” he says.
Danone also introduced Activia Immune System drinks with vitamin A and vitamin B12, Activia yogurts made with plant-based ingredients (vanilla, peach and cherry) and Silk plant-based yogurts (strawberry-raspberry and vanilla). To support sales, “Danone offers numerous tools to ensure impactful merchandising and quality execution via multiple in-store touch points,” explains Melançon.
One thing is certain—the food industry is undergoing a fundamental disruption. “In fact, at Danone, we go so far as to call it a ‘food revolution’–one driven by consumers who are shifting dramatically towards healthier eating habits while questioning where their food comes from, how it was produced, and the impact it has on their community,” says Melançon.
All of those factors seem to indicate yogurt’s time in the spotlight is far from over, even with any price hiccups that may lie ahead.