Frozen-Yogurt Revival

Segment resurgence a win for c-store impulse sales.

By  Abbie Westra, Editor-in-Chief, Convenience Store Products

Article Preview: 

RaceTrac is trying it. So are Casey’s, Love’s, The Pantry and Pilot Flying J, not to mention a good number of regional chains and independents.

Reflecting the trends toward snacking, customization and better-for-you foods, soft-serve frozen-yogurt is appearing in c-stores around the country as retailers hope to ride the wave started by the restaurant industry nearly 10 years ago. They’re rolling in shiny new machines, setting up vast toppings bars and training customers to understand the pay-by-the-ounce concept.

In the restaurant industry, the frozen-yogurt segment continues to grow as operators are attracted to its small footprint, low labor requirements and quick ROI. Despite market saturation in some cities, consumers continue to gravitate toward the segment to satiate their sweet tooth in a healthy, economical way.

For c-stores, the risks restaurateurs face—buying the real estate, making it a destination—are minimized: You already have the store, and the hundreds of other SKUs on your shelves make frozen yogurt more likely to be an impulse sale than a traffic driver, at least to start.

But today’s frozen-yogurt concepts have evolved since the 1980s craze, and c-stores will be challenged by the quality, flavor profiles and price point consumers have come to expect. A successful program will rely on a strong operational plan and aggressive marketing.

Steady Growth

Frozen yogurt’s resurgence began around 2005, when Red Mango and Pinkberry began infiltrating the marketplace. Not your mom’s TCBY, these new concepts surprised consumers with a tart flavor profile, funky toppings from Nutella to mochi, and a self-serve, pay-by-the-ounce format.

While the typical demographic of these concepts is the 16- to 34-year-old female, the segment actually sees a broad base of ages and genders, says Darren Tristano, executive vice president of Technomic Inc., Chicago. Its popularity and growth can also be attributed to timing: The by-weight format was perceived as an economical indulgence through the recession, and the health halo certainly helped, too.

For the operator or franchisee, Tristano likens the segment’s attraction to Subway: There are so many of them in large part because “you can open a store with small square footage, low labor and a small upfront investment,” he explains. “You don’t need a lot of revenue to get to profitability.”

While most c-stores will opt to slide a few frozen-yogurt machines into their foodservice or dispensed-beverage offer, Warrenton Oil Co., which runs 33 stores under the FastLane banner, opted to go all in and open its own stand-alone frozen-yogurt shop.

About a year ago, the Warrenton, Mo.-based chain opened Swirls n Sweets, a brand it developed internally. It went into an endcap of the company’s building that houses a FastLane c-store and—tip of the hat to Tristano—a Subway.

“We work to bring both brands together by taking samples of yogurt to the pumps to draw awareness to the yogurt shop,” says Laura Wacker, director of foodservice. The shop features a fun, energetic design with a pink, yellow and green color palette, crisp whites and a curving, tiled wall showcasing the built-in Taylor frozen-yogurt dispensers. There is plenty of seating and six machines, for a total of 18 flavor choices. Flavors vary from traditional strawberry with real fruit pieces to more unique offerings such as Ooey Gooey Cinnamon Bun.

Pages

Click here to download full article