COMPANYPROFILE
Culture Club
By educating more consumers on the health benefits of its great-tasting cultured yogurt products, Danone Canada continues to see sales soar
BY CAROL NESHEVICH
he rumours are true: yogurt is good for you. It’s a great source of calcium – more easily digestible for the lactose-intolerant than any other dairy products – and it’s highly beneficial to your digestive and immune systems. Doctors and nutritionists have touted its benefits for years, and it’s been a staple in many European countries for ages. Yet according to Danone Canada Inc.’s president and CEO, Louis Frenette, the nutritional benefits of yogurt aren’t as well known in Canada as they could be. “We’ve made it our local mission to increase yogurt consumption,” says Frenette. “The consumption per capita of yogurt in Canada has doubled since 1999,” he explains, adding that he believes that with a little effort, consumption would continue to grow by leaps and bounds. Frenette says that according to Euromonitor statistics, in many European countries people eat an average of 20 to 30 kilos of yogurt per capita; Canadians, on the other hand, eat about eight kilos per capita.
T
“The conditions are here, in Canada, to make that bigger,” he says, explaining that Canada is a wealthy, well-educated population. Canadians are increasingly looking to eat healthier, and are educated enough to comprehend what yogurt can do for their bodies. Of course, by spreading the word about yogurt’s benefits Danone Canada is positioning itself to expand on its already impressive success. It also doesn’t hurt that the company works very hard to produce products that taste good. And with annual revenues of more than $250 million, the strategy seems to be working. Danone Canada is part of France-based Groupe Danone, a highly successful worldwide company specializing in yogurt products, bottled water (with Evian being their best known water brand) and cookies (through the Lu brand, which is very popular in Europe). Before being purchased by Groupe Danone in 1993, Danone Canada was known as Delisle, a Quebecbased yogurt company with a 75-year history.
WWW.FOODI NC ANADA.COM
32
• AP RI L
20 0 7
Jude Delisle had been on a trip to France in the 1930s when he discovered the nutritional powers of yogurt. Upon returning to Canada he decided to get into the yogurt business himself, setting up a small shop in Montreal. Leslie Jonas bought the company in 1963, and thanks to his business acumen, Delisle had become the leading yogurt producer in Canada by 1967. By the following year production was being handled by a modern facility in Boucherville, Que., where Danone Canada’s headquarters are still located today. The 1970s were pivotal for Delisle. In 1975 the company launched Silhouette, Canada’s first fat-free, sugar-free yogurt brand. It was a hit with body-conscious Canadians across the country, and caused Delisle’s revenues to soar past the $40million mark by 1980. Today, with more than 500 employees and a sales force with offices across the country, Danone Canada markets brands devised by the international parent company Groupe Danone – including the wildly popular Activia, a yogurt made with the special probiotic B.L. Regularis (Bifidobactérium Lactis), as well as a number of children’s yogurt products like Danino – in addition to brands that have been created by Danone Canada itself. These latter include Silhouette, which is still a top-selling yogurt brand, and Cardivia, a new lowcalorie yogurt that has no milk fat and which features omega-3 polyunsaturated fatty acids from both fish and plant sources. Cardivia, introduced just last year, was developed in conjunction with Dartmouth, N.S.-based Ocean Nutrition Canada Ltd. “To have a competitive edge, we wanted to
Canadians are increasingly looking to eat healthier, and are educated enough to comprehend what yogurt can do for their bodies.
work with the best,” says Frenette of the partnership with Ocean Nutrition, adding that these types of strategic partnerships will be crucial in the innovation game as time goes on. Since omega-3 from fish has been shown to have certain cardiovascular benefits that flax oils don’t, Danone Canada wanted both fish oils and flax for the omega-3 content of its yogurt. Although Cardivia is currently only being sold by Danone Canada, other Danone companies around the world are free to use the formula and adapt it however they like, just as Danone Canada is free to produce any brands developed by other Danone companies around the world. For example, several years ago Groupe Danone partially acquired the U.S.based Stonyfield Farm company. This allowed Danone Canada to adapt the Stonyfield formulas and packaging for the Canadian market, making the popular Stoneyfield Farm the company’s first organic yogurt brand when it launched it last year. Danone also now offers Naturalia, made from only natural ingredients. A major part of Groupe Danone’s business is its bottled
www. f o odi nc a na d a . c om
water line, especially its worldrenowned Evian brand. A year and a half ago, Danone Canada entered the water business, launching its new Silhouette spring water-based beverages. In flavours such as Pink Grapefruit-Green Tea, LemonLime and Strawberry-Raspberry, these flavoured waters have zero calories and no sugar, and are able to capitalize on the company’s well-known Silhouette brand. So far sales are going well, says Frenette, noting that although the company’s focus is primarily on yogurt, it is always on the lookout for new opportunities and partnerships that make good business sense. At present, however, Danone Canada is putting a great deal of corporate emphasis on innovation and research. Groupe Danone laid the foundation for this focus, with approximately 800 international R&D specialists working on creating new products. Many of these scientists are in France working at the Danone Vitapole research centre. “They’re dedicated to finding the most appropriate materials to meet the nutritional needs of the people, and to develop products with specific health benefits,” explains Frenette. In Canada, Danone Canada has its own Danone Institute, led by Dr. Peter Jones. According to the institute’s website, its mission is “to improve the health and well-being of Canadians through better nutrition. Its mandate is to promote nutrition behaviour change in the general public, in vulnerable populations with an emphasis on childhood nutrition.” The Quebec-based, non-profit institute, which was established in 1998, is funded by Danone but administered by an independent board of directors and a scientific council. “We’re also encouraging local research at Canadian universities,” says Frenette, explaining that the institute gives grants to PhD students and scientists working on specific food science or nutrition questions. Since 1998, the Danone Institute of Canada has given more than $2.5 million in grants to students, graduates and researchers. “Research and product development is a great priority for us,” emphasizes Frenette. And it seems that Canadian consumers are happy with the results of these efforts. “Consumers are telling us they appreciate what we’re doing,” says Frenette. “The market share shows it.” Because of this, Danone Canada plans on continuing to focus on developing innovative, healthy products that taste good, while heavily promoting the benefits of yogurt in general to the Canadian public. “We’re investing a lot, in terms of capital expenditure, to make this category grow. We’re working very closely with the scientific community, milk suppliers, the government, the Danone Institute…trying to find solutions to make the economics better,” he says. “And it’s going well. We had a good year in 2006, and we’ll have an even better 2007.” FC
Food in C ana da •
33