This summer, more Canadians than ever were noshing like the Kardashians.
The boom in low-fat soft serve frozen yogurt joints exploded in popularity first in California, and spread across the U.S. over the past seven years. It has now ventured north. High-profile brands such as Pinkberry and Menchie’s – already marketed in pop culture through paparazzi shots of the product in the hands of Hollywood starlets and featured on television shows such as The Hills and Curb Your Enthusiasm – have been building a Canadian presence.
And they have spawned homegrown competition, such as fast-growing Canadian chain Yogurty’s. But when consumers fill their cups with chichi new flavours such as almond cookie, crème brûlée or red velvet cake at Yogurty’s, they may be on more familiar ground than they think.
The chain is owned by International Franchise Corp., the company behind Canadian frozen yogurt stalwart Yogen Fruz. Why would the marketing team sacrifice a well-known brand name for those new locations, effectively starting from scratch in its marketing in a competitive category? Because Yogen Fruz is too strongly associated with the last frozen yogurt craze in the 1980s – something its existing locations are trying to change. A new brand was needed.
“Because the name was so embedded in people’s minds as the company that blended the fruit, we felt that might have been a disadvantage to us,” said Aaron Serruya, chief executive officer of International Franchise. Mr. Serruya launched Yogen Fruz with his brother Michael in 1986, also capitalizing on a trend they had seen gain popularity in the U.S. at the time. When their company CoolBrands International saw its fortunes decline in the last decade, he spun off the franchise business and still runs Yogen Fruz today.
While these frozen yogurt brands began to be spotted in Canadian urban centres last summer, industry watchers identify this as the year that the trend has really begun to take root and expand.
“There’s going to be growth – you’ll see it ramping up the way the U.S. saw it three to four years ago … We’re going to see kind of a battle of the brands,” said Darren Tristano, executive vice-president of the food services industry research firm Technomic Inc.
“The first wave was, ‘Fool me into thinking it’s ice cream.’ This wave is more about the control,” Mr. Serruya said. “The customers want to customize ... [Self-serve] soft serve is the way of the future. If Yogen Fruz stayed with its original system, you’d be a dinosaur pretty quickly.”
The younger customers targeted by these chains primarily expect customized service. The new restaurants allow people to take as much or as little yogurt as they want, and choose their toppings in whatever variety and quantity they like. (With the exception of Pinkberry, which also allows for customized toppings and has servers build the dessert at the customer’s request, most chains are self-serve.)
Marketing to that generation also means not penalizing them for customizing their products. The pricing model at Menchie’s and Yogurty’s has customers pay by weight, which Michael Shneer, the president of Yogurtworld Corp., which owns the rights to Menchie’s for all of Canada, believes is a welcome departure from the old model of charging 50 cents extra for sprinkles, and seems intrinsically more fair. (Pinkberry has a slightly different system, that allows customers to choose a size of cup but then servers will add as many toppings as a customer requests, as long as it fits inside.)
Yogen Fruz’s owners expanded the Yogurty’s brand to attract those customers, but is also imitating the trend in its older stores, which are being renovated to include “U serve” machines. Yogen Fruz will continue to have a brand presence in shopping malls and cinemas, but the plan is for Yogurty’s to be the brand on the street.
Beyond the desire to customize, consumers’ eating habits are also changing, with more emphasis being put on health. Most flavours at the new frozen yogurt chains are low-fat or no-fat, and many even address the new pariah of the diet-conscious, by offering sugar-free flavours.
“We felt that a healthy indulgence would be much more preferred than an unhealthy indulgence,” Yogurtworld‘s Mr. Shneer said. Before banking on frozen yogurt, he was also responsible for bringing the Nutrisystem and L.A. Weight Loss diet plans businesses to Canada. Pinkberry is also marketing to a health-conscious crowd. It offers mini servings that are under 100 calories, for example.