Top 5 Take-Aways.
This year's food and beverage New Product Pacesetters illustrate practicality with pizzazz.
A hallmark of the country's economic downturn has been the return of home-based eating and drinking. The ranks of IRI's 2012 New Product Pacesetters confirms, though, that home-based need not be mundane. The best-selling food and beverage launches of 2012 are anything but mundane. They are healthful and flavorful. They are indulgent and exciting. They are convenient and, quite often, they are 100 percent portable. These products are a true lesson in not simply beating the new product odds, but doing so in a way that drives growth despite a less-than-ideal economic environment.
1 Go where the shoppers are
The evolution of the CPG industry's competitive landscape has been hastened by the country's long-standing economic downturn, with traditional grocery and drug stores facing intensifying pressure from channels perceived as having a stronger value proposition. Supercenters and dollar stores, for instance, have seen penetration and buy rate increase during the past year. Grocery and drug stores, meanwhile, have experienced flat penetration and decreasing buy rates. In 2012, an estimated 47 percent of food and beverage Pacesetter year-one sales came from outside the traditional grocery, drug and mass merchandise environment. CPG marketers must re-evaluate their distribution strategies, aligning their programs with the new, broader retailer environment and the 360-degree shopping behaviors of target shoppers.
2 Elevate the value proposition
Price is important, but value is absolutely critical. Value is a balance of price against product benefits. Key benefits and the importance of those benefits are different across different consumers, different categories and different brands. But, simply put, value is a product that effectively meets consumers' needs at a reasonable price tag. Successful marketers understand the needs of their key and target shoppers at a granular level. They develop products highly targeted to those needs and they communicate their value proposition clearly and consistently across marketing platforms.
3 Convenience is a must
Convenience is a long-standing, often secondary attribute of successful packaged-goods launches. In 2012, one in five food and beverage Pacesetters marketed convenience-related benefits. Convenience will remain a hallmark of the CPG industry.
4 Think outside the plate
The need for convenience has been elevated by the blurring of eating occasions. Today, one-quarter of consumers often eat snacks instead of meals because they are on the go. But, the term "snacks" is not limited to traditional snack categories, such as cookies and ice cream. Many food and beverage categories can and should play the role of snack and/or mini-meal. More than one-third of convenience-positioned 2012 Pacesetters took a bite-sized or handheld form. Some of these forms, such as squeezable fruit, have served to dramatically change the way a category is viewed. Innovators must continue to look across CPG aisles and beyond for new and exciting ways to deliver convenience and satiety to today's on-the-go consumers.
5 Take a proactive stance on wellness
Wellness is a long-standing trend in the food and beverage arena. Today, wellness is taking on a new look. In 2012, 15 percent of the most successful food and beverage launches offered functional attributes--added ingredients that enhance the product's nutritional profile. New technologies and new ingredients will continue to emerge, so savvy marketers must be constantly on the lookout for new opportunities to wrap the latest, greatest attributes into their own existing and emerging brands.
The class of 2012 IRI New Product Pacesetters is remarkable for many reasons. These products are bringing consumers increased value at a time when value is more critical than it has been in recent history. They are doing this by harnessing many and varied ingredients that not only taste better and offer enhanced nutritional value, but they bring excitement, without breaking the bank. Innovators across the CPG arena can make their road to successful and growth-stimulating innovation a bit easier and, perhaps, shorter by heeding the lessons of the many marketers that measured up to consumers' lofty expectations in 2012.
Price is important, but value is absolutely critical. Value is a balance of price against product benefits.
The best-selling food and beverage launches of 2012 are anything but mundane.
Susan Viamari is editor of Times & Trends at Chicago's IRI. She can be reached at 413.998.3266 or Susan.Viamari@iriworldwide.com.