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Two startups disrupt American Dairy in record time

Dairy Disruptors LTwo backyard brands, born out of the curiosity and imagination of a single young founder, have catapulted to the top of US dairy.

The American dairy is one of the most competitive spaces in the food industry, long dominated by giants who have the scale to quickly and widely distribute a product with a very short lifespan, in a sector where consumer brand loyalty is legendary.

Perhaps the most competitive product lines within this increasingly cut throat category are yogurt and ice cream, and yet two backyard brands, born out of the curiosity and imagination of a single young founder, have catapulted to the top, taking on giants like Yoplait, Chobani, Haagen Dazs and Breyers in just a few short years – and all through the power of creative disruption.

Noosa Yoghurt was co-founded in 2009 by Koel Thomas, who discovered the creamy whole milk yoghurt, sweetened with passion fruit, while on a visit to her homeland of Australia.

She returned home to Boulder, Colorado, made a deal with a local dairy, built a yogurt factory right next door, and began marketing Noosa in the US.

Advent International acquired Noosa in 2014 to expand their production capacity, and sales this year are expected to hit $9.3-billion.

Halo Top Ice Cream is marketed as the ice cream that’s so good for you that you can eat the whole pint in one sitting. One fan lived on nothing but Halo Top ice cream for 10 days and actually lost weight.

Halo Top was invented in 2010 by former attorney, Justin Wolverton who, came up with the recipe while experimenting with his new Cuisinart in his own kitchen trying to come up with sugarless desserts to satisfy his own sweet tooth.

From these humble beginnings, Halo Top has shot to the top of the freezer case in record time. Halo Top sales in 2016 jumped about 2,500% from the year before. And they did all of that without spending on any traditional marketing.

So how did Noosa and Halo Top manage to disrupt the American dairy in record time? Here are a few ideas:

View your product through fresh eyes: Rather than trying to compete on the same playing field as other brands, both Noosa and Halo Top reimagined their offerings through an entirely new lens.
Halo Top uses top shelf whole ingredients, and no artificial substances of any kind, yet still manages to weigh in under 400 calories a pint.

In a category dominated by low fat products, Noosa is a creamy whole milk yoghurt that is part of a new whole fat trend that is starting to filter down from more specialised market onto mass market shelves.

And while most yogurt flavours are created in focus groups, Noosa curates theirs through the lens of travel, making a yogurt company into an experience company.

Noosa’s “flavour trek” line offers unique global flavour combinations like pear cardamom or raspberry habanero that are inspired by the founder’s own world travels.

Both brands have achieved first and best in class as a result of seeing their products through fresh eyes and offering consumers something new and unique.

Good worth of mouth begins in the kitchen: Noosa and Halo Top both place an emphasis on top quality, full flavour products made with seasonal and sustainable, whole ingredients.

Both products really do deliver on their brand promise right from the very beginning of the production line – in the kitchen.

Both companies were able to maintain their level of quality and still manage scale as start ups, because both companies owned their own production line from farm to kitchen to grocery shelf.

This allowed both brands to succeed without having to spend any money on traditional advertising. Word of mouth from happy customers did it all for them.

Innovation applies to packaging too: Just like the titan yogurt disruptor Chobani, and their now famous flip top yogurt cups, Noosa and Halo Top both owe some of their success to innovative packaging.

When Wolverton was designing his packaging, he thought first about how to stand out on a crowded freezer shelf.

He settled on doing something different, and in a category which usually features pictures of the product on the package, Wolverton chose bright colors, simple patterns, his signature golden lid halo, and a transparent expression of the products calorie count and ingredients as a an innovative way to showcase the product.

Noosa completely reinvented the shape of the yogurt cup, making it wide, flat, and providing a larger canvas for toppings.

Source: Forbes.com, authored by Charles Koppelman, who writes about business trends in the retail and music industries.

Related reading:

Fat is back…the rise of creamy yogurt

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