Where were you during the Great Froyo Wave of the 2010s?
According to some frozen yogurt operators, we’re still smack dab in the middle of it.
Though many frozen yogurt chains have seen sales and unit counts freefall in recent years, some concepts maintain they are just as relevant as ever. These brands are attempting to avoid the pitfalls of the past and expand their reach with new flavors, partnerships and ingredients (often of the plant-based variety).
Sam Yoon, president of California-based chain Yogurtland, believes the frozen yogurt era is far from over.
But previously, he said, froyo became too commoditized for brands to thrive.
“For the first [frozen yogurt] wave in the 1980s, the key factor was that it was so popular that everybody did frozen yogurt,” he said. “I think that commoditization trap, we will be able to avoid that through the innovation and also the experience of coming to our store, which will be different from the commoditized experience of any restaurant or in a grocery store.”
Here’s how chains like Yogurtland are hoping to leave that trap in the last millennium.
A focus on innovation
The frozen yogurt market has historically been prone to booms and lulls in demand, and its most recent wave is no exception.
Per a report from Restaurant Business sister company Technomic, only 19% of consumers planned to increase their consumption of frozen yogurt last year—and 16% planned a decrease.
Menchie’s Frozen Yogurt, a top player in the froyo sphere, saw units shrink 15.4% in 2021, according to Technomic. Sales at Pinkberry, a onetime darling of the frozen dessert world, have fallen an average of 31.8% over the last three years, and its units dropped by 5.3% last year. At Orange Leaf Frozen Yogurt, sales slipped by 44.2% and unit count by 41.3% during the last three years.
Yet some chains remain optimistic, such as New York-based brand 16 Handles, which grew sales 7.5% last year while its unit count remained stable.
Neil Hershman, the newly named CEO of 16 Handles, argued that demand for frozen yogurt has remained prominent.
“It’s been a really strong market for a long time, there’s this thought that there’s these different waves of froyo, but if you look at it on a longer scale, it’s been overall successful for two decades now,” he said. “It is a good, long-standing proven concept, however, there’s not a lot of innovation in it. So maybe the question is: Why are the same brands still the largest owners of the frozen yogurt segment?”
Hershman said he doesn’t see oversaturation as an issue for frozen yogurt concepts.
“Some of these older, aging stores that haven’t been upgraded, that don’t have unique product lineups and aren’t meeting the modern consumers demands will phase out,” he said, noting that he believes lack of innovation is a larger hurdle.
“I think the bigger issue is that you have a lot of national brands that stopped innovating and stopped giving their franchisees the resources they need to update their stores, to refresh business and a constant flow of new product offerings and new marketing materials,” he said.
While other chains have missed opportunities by focusing on one type of consumer, aka kids, 16 Handles tries to create an energetic experience for a variety of customers, Hershman said.
“At 8 p.m., these entry-level workers, these couples after they finish their dinner date, they should have somewhere to go: a cool place to hang out, to sit down and enjoy dessert,” he said. “And that’s what 16 Handles was, and that’s how I found it. It’s a modern design and just a really fun store to hang out in.”
Leaning into technology has also allowed 16 Handles to keep pace with consumers, he said.
“I think there’s really strong demand, especially for brands that are meeting the modern consumer and are engaging the modern consumer on social media and on platforms that they’re actually on and giving them a really great delivery and pick-up options,” he said. “Online ordering is a huge part of our business now.”
In that vein, 16 Handles earlier this year brought on YouTuber Danny Duncan, whose channel has generated 1.5 billion views, as chief creative officer and co-owner. This came as a result of the company’s sale to Hershman, who is also its majority franchisee.
Yogurtland has taken a similar path when considering how best to reach today’s consumer. “We’re focused on the customer experience side … impactful communication, which is clear and consistent,” Yoon said. “That involves influencers, social media, et cetera, the relevant content for this time.”
In addition, he said Yogurtland directly involves customers, such as its rewards members, in its flavor development process.
“Right now, we have a strategy and flavor plan that goes into 2026, considering what the customers want, what the market wants, what makes our customers really love our brand,” Yoon said. “Collaboration is really a key word for us.”
Yogurtland has also teamed up with popular CPG brands and incorporated items such as Sour Patch Kids and Flamin’ Hot Cheetos into its new flavors and toppings.
A healthy positioning
Cheetos aside, the health halo of frozen yogurt is one aspect that will help it stay top of mind, Yoon said.
“It’s very in trend right now, it’s about healthy,” he said. “[Frozen yogurt] contains probiotics, helps digestion, it can boost the immune system and so it’s this concept of healthy.”
According to research from distributor ADM, 57% of consumers are more concerned about their immunity due to COVID-19, and 48% of consumers plan to purchase more items related to health and wellness.
Yogurtland is innovating its products to meet these trends, Yoon said. The 224-unit chain plans to launch dairy-free flavors to meet the growing demand for plant-based foods.
“We’re gonna be very innovative with categories like no sugar added, dairy-free flavors, plant-based flavors—it will play into supporting us being very relevant and impactful in the market,” he said.
Similarly, 16 Handles has partnered with plant-based milk producer Oatly to provide a variety of dairy-free options, and the brand dedicates two of its handles to flavors made with Oatly products.
“We’re able to kind of leverage all that [Oatly is] doing and bring in all these consumers and additionally give all of our existing vegan consumers the best vegan frozen yogurt offering that has ever been made,” Hershman said.