Greek Yogurt Maker Chobani Is Going Traditional For The First Time

June 28, 2017, 1:38 PM UTC

Hamdi Ulukaya changed the yogurt aisle forever a decade ago when he starting convincing Americans to give Greek-style yogurt a try. This summer, Chobani has plans to go tackle the market it disrupted: traditional low-fat yogurts.

With a launch unveiled this week at major national retailers, the yogurt maker is launching a new style it is calling Chobani Smooth—marketed as a low-fat, classic yogurt that packs twice the amount of protein as competitor offerings and 25% less sugar. The line, which retails for $1.79 per two pack, comes in five flavors including vanilla, peach and blueberry. The goal? Steal market share from the category’s legacy players Yoplait and Dannon yet again.

“This is a superior product,” Ulukaya told Fortune in a recent interview in Chobani’s New York City office. “This is the most delicious traditional yogurt in the market place.”


Greek yogurt maker Chobani is launching a traditional style for the first time in 2017.Courtesy of Chobani
Courtesy of Chobani

The yogurt industry in the United States is a roughly $8 billion market and Greek yogurt—a subcategory shepherded by Chobani—represented just 1% of the market in 2007 but now commands about half of dollar sales. Chobani revolutionized how yogurt was made and marketed in America, touting Greek yogurt as richer and more nutritious than the mainstream offerings by General Mills’ (GIS) Yoplait and DanoneWave’s Dannon yogurts. Chobani is now the largest-selling brand in the U.S., generating $2 billion in revenue annually in the market, according to research firm Euromonitor.

But in the process, light yogurts fell out of favor as consumers sought foods with higher fat and protein levels, resulting in double-digit sales drops for yogurts marketed as “light” or “low fat.” Greek yogurt fit neatly into those broader food trends, as companies like Chobani and Noosa Yoghurt touted their offerings as being more on-trend and nutritious.

Even Greek yogurt sales have softened of late, though Chobani and others across the industry blame the declines on Yoplait, which failed to respond to the changing trends in the market. This week, General Mills reported a steep double-digit decline for the company’s U.S. yogurt business in the most recently concluded fiscal year. It is vowing a fix with a new yogurt style called Oui by Yoplait.

Meanwhile, at Chobani, the newest innovation is a concession that Greek yogurts aren’t for everyone. “Thinking that everybody who is a yogurt eater is going to eat Greek is unrealistic,” admits Ulukaya. When asked if Greek is his preferred style, he says, “It is. But I can see myself going to [Chobani Smooth] every once in a while. There is a true craftsmanship behind it.” He hopes that Chobani Smooth can resurrect the slumping traditional yogurt market.

Chobani’s innovation in recent years has aimed to expand the brand beyond the winning share it commands within Greek. Chobani Flip, which combines yogurt with a pouch of sugary extras like honey-covered nuts that you can “flip” into the yogurt, is now a $350 million business. A ready-to-drink yogurt was launched last year to tackle rising interest in yogurt drinks and shakes, a category that grew to over $766 million in sales last year with double-digit growth according to research outlet Nielsen.

“We need to act like a leader in the category because the leaders aren’t acting like a leader,” says Ulukaya of his main rivals. “The magic of yogurt needs to come back.”

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