Comment: Chobani spreads wings amid pressure in yoghurt
Chobani, facing slowing growth and fierce competition in yoghurt, is diversifying
With its latest new products, Chobani has signalled its ambitions - but the moves into categories like desserts and oatmeal could also suggest the privately-owned US yoghurt group is feeling the pressure in its core sector.
The company will roll out products including Chobani Indulgent desserts and Chobani Greek Yogurt Oats in June. These two lines represent moves into new areas for Chobani, which has been at the forefront of the boom in sales of Greek-style yoghurt in the US.
Announcing the launches, Chobani said the products were a natural extension for a business looking to "push Greek yoghurt beyond breakfast".
"The yoghurt story in America is just beginning and as the category leader we are creating new ways to enjoy Chobani's delicious, nutritious, natural products throughout the day," Peter McGuinness, Chobani's chief marketing officer, said.
Chobani is a business only formed in 2005. It reportedly generated sales of US$1.5bn last year. Founder and CEO Hamdi Ulukaya and his colleagues clearly have a strong track-record of growth. And the new products appear sensible ways to extend the Chobani brand - a brand with a solid following - into adjacent categories.
However, the products will be ways for Chobani to diversify its product offering at a time when the might of Danone has nibbled away at its leadership of the US Greek yoghurt sector.
Danone last month told an investor conference in London it was no longer behind Chobani in the category. "We are head-to-head," Danone co-COO Emmanuel Faber said.
Danone has been stepping up its own new product development for the US market. Last month, it launched Danimals Superstars, a Greek yoghurt line aimed at children.
Further back, General Mills has been increasing its activity in the sector. The Yoplait owner pointed to increased investment in marketing and merchadising yoghurt as a factor in its profit warning for its third quarter last month.
Above all, while there is still growth in Greek yoghurt, it is slowing - Danone's Faber claimed last month the sector was "plateauing" - meaning Chobani has to look for new avenues of growth.
Chobani has been reported to have been in discussions to sell a stake in the business. Three weeks ago, The New York Times, citing unnamed sources, said private-equity firm TPG Capital was in "advanced talks" to become a shareholder.
No deal has been announced but, in the meantime, Chobani has been demonstrating its ambitions - both in the NPD news of recent days but also moves into new markets in Asia and Latin America.
Investment from the likes of TPG into a business spreading into new categories will make more of the established food giants sit up and take notice.
Nevertheless, such diversification is likely to be borne out of necessity as well as ambition.
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