“In 2024, global CPG innovation reaches an all-time low.”
That stark pronouncement is the first line in a new report from Mintel that says true innovation in food & beverage and across consumer packaged goods categories is at its lowest level since the market research firm began tracking new products in 1996.
When comparing different CPG industries, innovation has declined the most in food & drink, which launched just 26% of truly novel products between January and May 2024 compared to 50% in 2007, the report says. “Food & drink companies have preferred to launch new varieties/range extensions or new packaging as a way to offer new, but familiar, choices to consumers.”
Across the whole CPG landscape (food & drink, household, health, beauty, personal care and pet care), just 35% of global CPG launches were genuinely new products. This “means that so far in 2024, 65% of launches are ‘renovation’ -- i.e. line extensions, reformulations, new packaging or relaunches,” Mintel says.
Declining innovation comes at a time when big brands have just pushed through significant price increases, in many cases without offering consumers any additional benefits, according to the report.
This makes it easier for consumers to switch to private-label alternatives. For example, in May 2024, almost a third (31%) of U.S. adults admitted to buying more store brands over the past two months. Will those consumers automatically return to big brands once they feel more financially confident?
Looking at geographic segments but across all CPG categories, North America was next-to-last in innovation in the first five months of this year, its 29% innovation rate just one point ahead of South America and behind Africa (46%), Asia Pacific (37%) and Europe (34%).
See the full report at: https://www.mintel.com/insights/consumer-research/role-of-innovation-future-cpg-industry
