Defense

Yoplait and the Hidden World of Defensive Strategy

11 Sep , 2013  

Defending Yoplait is a top priority at General Mills but you wouldn’t know it if you look at the company’s annual report.

Yogurt is an important business at General Mills. The category is growing quickly, which is fairly unusual in the world of food. General Mills recently acquired global rights to Yoplait, one of the largest brands in the category. Yogurt makes up 15% of the company’s global revenue.

yoplait logo

Unfortunately, General Mills ignored the Greek yogurt category and now the business is quickly losing share as new entrants Chobani and Fage build awareness and trial and established player Dannon aggressively defends its position. In its 2013 fiscal year, General Mills saw U.S. yogurt revenue fall by 5% even as the category grew. This follows a similar decline the year before. These are just terrible results.

So defending its yogurt business has to be a top priority at General Mills.

The company is clearly focused on the task. It recently reformulated all of its Greek yogurts to improve the quality. It updated the packaging. Just this Sunday, the company ran a full page color ad in the New York Times. I can’t recall ever seeing a full page ad for yogurt in the New York Times. General Mills is (finally) investing and spending to defend.

The amazing thing is that this defensive effort isn’t mentioned once in the just released 2013 annual report. I received my copy last week. The words defend, defense, protect and respond don’t seem to appear at all. The report’s theme is “Healthy Growth.”

What?

The company doesn’t mention the defensive effort in the annual report at all?

Really?

Of course, this isn’t unusual. Companies generally don’t discuss defensive efforts. Brands defend all the time but rarely mention the topic. It is a hidden world.

This is partly because many executives think talking about defense seems weak. People like to discuss innovation and growth and social responsibility.

The other issue is that companies are nervous about antitrust regulations. The rules on competitive activity are not clear so the internal legal team will almost always say that the safest approach is to avoid mentioning defense in public.

But hiding defensive efforts is not the best approach.

Employees and partners need to see a company fighting back. A competitive battle is a great way to motivate employees. To defend well, a company has to move quickly, invest and engage the entire team.

Dannon took a very different approach, quickly recognizing the defensive challenge and responding. Dannon discussed the issue in public and then bought an ad on the 2012 Super Bowl, a move that had enormous symbolic value; Dannon let everyone know that it was not going to let the category slip away as Chobani grew. It was defending.

General Mills should not keep its defense a secret. It should communicate its commitment to maintain its market share to its employees, partners, customers and investors. The New York Times ad was a good move but it is just a start.


2 Responses

  1. Just want to say your article is as surprising. The clearness in your post is simply cool and i can assume you are an expert on this subject.

    Well with your permission let me to grab your feed to keep up to date with forthcoming post.
    Thanks a million and please continue the rewarding work.

  2. This is so true! Everyone seems to be “infected” with the word growth. Funny thing is that if you don’t grow as fast as your base is loosing due to lack of defense…in the end you are actually shrinking…

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