Greek Yogurt Latecomer Danone Eats Chobani's Lunch

Just two years after releasing its first product in 2007, Chobani became the biggest U.S. seller of Greek-style yogurt, which has more milk solids and a sharper taste than the conventional variety. This is not the kind of success that goes unnoticed by Danone, the world’s largest yogurt maker. After being blindsided by the upstart, the French food giant has fought to take back the dairy section with Greek-style products from its own Dannon Oikos brand. A marketing blitz included a pricey Super Bowl ad, and it’s given out samples at store promotions. The success of Danone’s belated push to slow Chobani’s momentum and narrow its lead in Greek yogurt is a testament to how an established player’s marketing heft can trump a newcomer’s first-mover advantage.

Danone put a picture of an ancient Greek colonnade on every package and cast Greek-American actor John Stamos in its Super Bowl ad to boost its Hellenic bona fides. Oikos sales increased 165 percent in the 12 months through May 2013, according to researcher Mintel Group. Although Mintel estimates that Chobani’s sales rose more than 20 percent in the same period—it still leads the segment—Sanford C. Bernstein says it has lost share for 18 straight four-week periods.