The Chobani brand is widely credited with starting the Greek yogurt craze in the U.S.Consumers have gone nuts for it since the product hit shelves in 2007, and Chobani has grown into a massive force.
Turkish native Hamdi Ulukaya is the man behind Chobani. The 40-year-old ran a modest cheese company in New York state before getting into the yogurt business.
Now, the company is the No. 3 maker of non-frozen yogurt in the U.S., raking in about $750 million in sales, according to Symphony IRI. The only ones ahead of it are industry titans Yoplait (owned by General Mills) and Dannon (owned by Danone).
And it all started with one snap decision.
'I came from a family of farmers who made cheese and yogurt, but that was the furthest thing from my mind at that time,' he told Forbes. 'I came here for education, to learn English, to learn business.'
That changed once he saw the opportunity. Ulukaya had always thought that American yogurt brands were 'horrible,' and thought if he made something better, people would flock to it.
Ulukaya initially threw away the ad, but decided the next day that he wanted to buy the former Kraft Foods plant in Columbus, N.Y. It took him five months to come up with the funds to do it.
He bought it using less than $1 million in loans, including one from the U.S. government's Small Business Administration, according to the Wall Street Journal.
'Everybody around me thought I was nuts,' he told the WSJ. 'Here was this huge company, Kraft, getting out of this plant. If there was value in it, why would they close it? But you just have a gut feeling you can do something.'
'I wanted to make sure the product was perfect because I only had one shot and it had to work,' Ulukaya told the Wall Street Journal.
He worked with his sixth employee -- a 'master yogurt maker' and family friend from Turkey -- to create it.
The company's original name was Agro Farma Inc., but Ulukaya later decided to rename it after his flagship brand Chobani.
Chobani's big breakthrough came in late 2009, when BJ's Wholesale Club and Costco decided to put the product on their shelves.
Since then, Chobani has been growing like crazy, prompting a Greek yogurt craze that's sweeping America.
In 2009, Chobani was selling 200 cases of yogurt per week. Now, it's selling 1.5 million of them.
It's the top-selling yogurt brand in America, with around 10% market share in the overall non-frozen yogurt industry (though both Yoplait's and Dannon's total yogurt operations are much bigger because of their multiple brands).
And it utterly dominates Greek yogurt brands with about 50% market share.
Early on, Ulukaya didn't have the funds to market his yogurt traditionally, so he had to figure out other ways.
'I used to answer the phones and I would hear people say 'I love this yogurt. I'm going to tell my friends and family about it,'' he told the Wall Street Journal. 'That gave me the idea to reach out to bloggers, and to use Facebook and Twitter to have direct communication with consumers. We also had our own sampling truck that went all over the country to festivals and parades.'
Now with more funds, Ulukaya can afford to advertise in traditional channels. However, Chobani's latest attempt had some problems.
Chobani was forced to cut short its first ever national TV ad campaign last year due to capacity problems. The stumble prompted additional investments by Chobani. It's spending $300 million to build a new plant in Idaho, and $100 million more to expand its original plant, according to the Wall Street Journal.
Chobani has its own kids-centric Greek yogurt brand called Champions. Its latest promo uses U.S. softball superstar and two-time Olympic gold medalist Jennie Finch, pegging it with all the Summer Olympics hype (even though softball won't be played at the Olympics this time).
Chobani has become so powerful that even food industry juggernaut Kraft Foods didn't stand a chance against it.
Kraft Foods discontinued its Athenos brand of Greek yogurt earlier this year after just two years on the market. Despite the popularity of the segment, the brand's marketing just wasn't working, and Kraft decided it was best to invest in other product lines that had a better chance of success.
As CEO, Ulukaya is still heavily involved in the day-to-day activities of Chobani. He devotes his life to it.
'You have to have passion because it requires a lot of sacrifices,' he told the Wall Street Journal. 'I sacrificed my family life. I lived in the plant for the first two years. I still live in the plant.'
'We've said no to almost everybody you can think of,' he told Forbes. 'We're having fun. I'm going to be here a long, long time. I'm not somebody who is going to build something for a few years, sell it and then go off and just have fun. That's not why I did this.'
The Greek yogurt craze is in full swing, and Ulukaya -- along with his 1,200 employees -- are taking full advantage of it.
Greek yogurt makes up around 28 per cent of the total U.S. yogurt market now. Three years ago, it was only 3 per cent, according to UBS.
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