Red Mango USA dishes up healthier frozen yogurt

LOS ANGELES -- The frozen yogurt business puts a sour taste in Daniel Kim's mouth. And that's good.

Kim is on a mission to bring a more tart and better-for-you version of frozen yogurt to the USA. Already a hit in South Korea, it is fermented in a way that he says makes it less sweet and more healthy than desserts that are often called frozen yogurt.

Winning over U.S. consumers, though, won't be easy. Red Mango USA, headed up by former investment banker Kim, 31, has only 10 stores open. It is facing stiff competition from West Coast upstarts that are attempting to get consumers to try this new type of frozen yogurt, often called fro-yo, that's served in a cafelike environment.

Meanwhile, frozen yogurt hasn't exactly been one of consumers' top choices. Production of frozen yogurt has fallen 43% to 303.5 million pounds in 2006 from 1990, says Don Blayney of the USDA Economic Research Service, which means the average person ate just a pound of frozen yogurt that year.

But despite the major hurdles, Kim thinks consumers are ready for premium yogurt much as they were ready for deluxe coffee when Starbucks first started. "Yogurt is healthy, natural and tastes good," he says. "People love this concept."

The fact frozen yogurt isn't yet mainstream means it's possible to grab a bigger slice of the market for frozen dessert, Kim says, which the International Dairy Foods Association sized at $23 billion in 2006.

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Made like beer and cheese

But what is the concept? The first key ingredient is the product itself, the yogurt. It's real yogurt, meaning it's fermented in much the same way that beer or cheese is made. Most desserts called frozen yogurt are made by mixing powder, milk and sugar.

Red Mango's process leaves behind living organisms called live and active cultures. These cultures give the yogurt probiotics, or organisms believed by some to have health benefits that continue to be studied, says Jeff Blumberg, professor of public health at Tufts University.