Contemporary Marketing 16th Edition by Louis Boone,David Kurtz

Exercise 4

When a Turkish immigrant converted an old food plant in upstate New York to create a kind of yogurt unlike anything many U.S. consumers had ever tasted, little did he dream his company would receive an Entrepreneurial Success of the Year award a few years later. Chobani, the company Hamdi Ulukaya founded with five employees in 2005, has become the number-one producer of Greek yogurt in the United States and is driving a dramatically rising trend.
Greek yogurt, with its thicker, creamier texture and slightly tart taste, now accounts for 25 percent of U.S. yogurt sales, and some observers believe there is no end in sight. Chobani and other brands of Greek yogurt have more protein and less sugar than products made by most U.S. firms, and consumers-especially women and upper-income shoppers-are snapping it up as fast as producers can manufacture it. Sales have reportedly more than doubled in each of the last three years, and the market has grown to a value of about $800 million a year.
Chobani and Fage, one of its competitors, both have ambitious expansion plans, including enlarging their plants, which lie about an hour apart in New York State, where they have given a strong boost to the local economy. "We're literally building as we speak to keep up with demand," said Fage's director of U.S. marketing. With a third company building a new plant in the area, too, yogurt production in New York alone is increasing 40 to 60 percent each year, creating what a dairy industry official calls a "once every two or three generations situation" for dairy farmers and yogurt producers alike. Chobani is also spending $128 million to open the largest plant of its kind in Idaho, in part to ease distribution of its products to western states. Meanwhile, mainstream yogurt makers like Dannon are introducing Greek-style yogurt products too.
Chobani has grown to employ 1,200 people and ships almost 2 million cases of yogurt across the United States every week. With "Nothing but good" as its corporate motto, the firm still pays individual attention to each batch. "We aimed at people who never liked yogurt," Ulukaya says, explaining that these consumers had never tasted Greek yogurt before, so they couldn't be blamed for not realizing how tasty it could be.
QUESTIONS FOR CRITICAL THINKING
1. What factors account for the rising popularity of Greek yogurt?
2. Do you think the sales trend will continue upward? Why or why not?