Interview Synopsis

Danone – US essential dairy & plant-based division strategic review

  • Multi Asset
  • Consumer
  • North America

With plant-based products gaining ground around the world and stiff competition in traditional dairy, Third Bridge Forum interviewed a former executive at Danone SA to discuss the US dairy market and the company’s essential and plant-based segments.

A look under the lid of Danone’s US dairy business

As well as pricing pressures from competitors Yoplait and Chobani, one of the challenges unique to the US is that yogurt is perceived as a snack, resulting in a much lower penetration rate than Europe. “When it comes to the moment of consumption, the dairy yoghurt actually does compete with a lot of other snack alternatives, which has always been the challenge,” the expert said.

Conversely, the overall plant-based category has logged robust growth, ranging from 5% up to 30%-plus in certain sub-segments. “That’s really where there is an opportunity to grow the business, going forward, and there is a possibility also to extract more value than in the traditional dairy, where clearly the competition was more intense,” the specialist said. 

However, the plant-based market is also growing rapidly, making it more difficult to compete, particularly in the oat milk or oat-based product segment.

The strategic rationale behind Danone’s acquisition of WhiteWave, which effectively doubled the size of the business, was also discussed. “What is important to understand is the strategic rationale was actually going far beyond North America only,” the expert said. Indeed, the acquisition gave Danone a “strong foothold or a strong starting point in Europe with Alpro”.

After touching on Danone’s organic brand, Horizon, the Interview discussed the future growth of Danone’s legacy yoghurt portfolio in the US, and offered a three- to four-year outlook for the total US business.

To access all the human insights in Third Bridge Forum’s Danone – US essential dairy & plant-based division strategic review Interview, click here to access the full transcript. 

The information used in compiling this document has been obtained by Third Bridge from experts participating in Forum Interviews. Third Bridge does not warrant the accuracy of the information and has not independently verified it. It should not be regarded as a trade recommendation or form the basis of any investment decision.

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