New brands vs. extensions
History shows that food & beverage marketers frequently choose brand extension as a means of bringing new products to market, and this trend continued in 2009. After all, they bring fresh news and vitality to core brands with less investment and shorter lead times versus new brand innovation. New food brands usually outperform brand extensions, but in 2009 food and beverage extensions garnered substantially higher year-one sales, on average, versus new brand introductions.
Marketers who have established strong brand equity are working to maintain relevance by "tweaking" existing lines. Campbell's Select Harvest soups, the top-selling food and beverage introduction of 2009, is an example of this type of product evolution. That's particularly important, since SymphonyIRI's 2009 Economic Update survey found 46 percent of consumers are trying fewer new products these days.
To combat this reality, new product introductions are becoming increasingly targeted. Bud Light Lime, for instance, is a successful new launch with niche-market focus on those who like the taste of lime in their beer. Kellogg's FiberPlus bars make eating healthy enjoyable. A high-fiber snack with antioxidants, vitamin E and zinc, the bars help consumers achieve their wellness goals without sacrificing indulgence.
More than 80 percent of successful new food and beverage products over the past year bring added variety to the marketplace. In an industry that serves consumers with shrinking pantries, this is a startling trend, and it is not expected to change in the near future. It speaks volumes to the need for consumer-centric marketing – from new product innovation to package design to distribution/assortment to communication across marketing platforms.
Key benefits centered on health and wellness, convenience and excitement. As technology evolves, CPG marketers have successfully brought these benefits to market across a variety of products.
The year's most successful food and beverage innovations deftly capitalized on consumers' drive for at-home and from-home meal and snack solutions that provide a mixture of nutrition, convenience and indulgence.
Products with wellness benefits dominated the most successful new product launches, and of those the themes were potency and efficacy. But today's consumer is driven by value. Consumers are planning carefully to get the most from their money.
High fiber and whole grain product attributes continue to be in high demand, and CPG marketers are feverishly working to capitalize on this opportunity. In 2009, products touting grain claims accounted for 4 percent of CPG sales, and are increasing in number. Unit sales of products with grain claims climbed 3.4 percent for the year, and 22 percent of the Pacesetters tout high fiber or whole grain claims. In it's first year, Yoplait Fiber One yogurt garnered $26.6 million in sales despite a difficult economy.
Across nearly one-third of 2009 Pacesetter products, CPG marketers have added nutrients to enhance the wellness profile of their products. For example, Ocean Spray CranEnergy is a juice drink enhanced with green tea extract and B vitamins, providing a healthful and natural energy boost to "get through a busy day." Beechnut Let's Grow line targets the youngest consumers with added nutrients to support healthy growth and development.
Technology is paving the way for more powerful food & beverage solutions. CPG marketers are effectively harnessing these technologies and raising the bar on wellness. And while wellness has been on consumers' radar screens for several years, this past year saw wellness goals escalate to a new level.
Nearly three-quarters of shoppers embark on shopping endeavors seeking components to make a nutritious meal. Products across categories are hitting the mark: Thomas' Better Start English muffins are a low-calorie, high-fiber breakfast option. Healthy Choice All Natural frozen entrees provide consumers with a "healthy in a hurry" lunch or dinner. And Nature's Pride bread crosses dayparts with natural snack/sandwich appeal.
The drive for wellness is not expected to wane. CPG marketers displaying an intimate understanding of the wellness goals of their key consumer and target markets will play an integral role in driving the growth of this important industry segment.
SymphonyIRI's 2010 Snacking Survey reveals 32 percent of consumers view snacks as an important part of a healthy eating plan. Dannon's Danimals Crush Cups are an on-the-go yogurt option targeting the youth markets. And Yoplait Delights provide a sweet treat in a controlled calorie portion.
At-home cooking and eating is quite prevalent. In fact, 60 percent of consumers are creating and serving simple meals at home with increased frequency, and nearly all will continue to do so throughout 2010. Consumers do not want to compromise, though. Products such as Campbell's Select Harvest soup and Arnold Select Sandwich Thins make creating high-quality and health-wise meals quick and easy. Meanwhile, lines such as Bush's Best Grillin' Beans and Dreyer's Edy's Fun Flavors ensure that day-to-day dining is anything but boring.