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06/02/2012

Pulse Report: Adding variety and pizzazz through new products

Retailers aimed to ease consumers' budgetary woes as they stocked new entrees inspired by restaurant-style meals and new cosmetics and personal care products that offered improved performance without the cost of professional salons.

These are just a few of the findings highlighted in SymphonyIRI's 2011 New Product Pacesetters analysis, an industry-recognized benchmark of exceptional first-year CPG sales for newly launched products.

Larry Levin,
executive vice president/general manager, consumer insights,
SymphonyIRI Group

As a whole, new items also registered smaller year-one sales than new entrants of more robust economic periods. Eight out of 10 new products in 2011 generated less than $7.5 million in sales, which was the minimum level to qualify as a Pacesetter. Two-thirds fell short of the $20 million mark and only three new brands rang up $100 million or more in year-one sales, according to SymphonyIRI. "In 2011, we definitely saw the continuation of a trend toward smaller, more targeted innovation," says Larry Levin, executive vice president, consumer insights, SymphonyIRI.

Products with pizzazz or a fun image caught on in 2011, while other successful launches focused on convenience and performance. With consumers eating more meals at home, complete dinner solutions represented 23 percent of food Pacesetter dollar sales. Introductions that added variety to a category through new flavors or new technology also were popular, Levin says.

Candy and gum were among the hot categories, as shoppers splurged on sweet indulgences while cutting back on other luxuries. Wrigley's Extra Dessert Delights from Mars brought new out-of-the-box flavors, such as apple pie, to gum. "Variety really is about bringing excitement and indulgence to the next level in the candy and gum arena," Levin says. The growth of the K-Cup single-serve coffee category also is based largely on providing more beverage varieties in a convenient, make-at-home format. "The K-Cup explosion is also playing nicely into trends around convenient, restaurant-inspired dining at home at a much lower price tag," Levin says.

"The proliferation of targeted innovation and the success of small players, such as Udi's Gluten Free Foods, proves that you don't have to be a behemoth to become a Pacesetter. It's listening to and answering your customers at a very individualized level that translates to prolonged success in the CPG marketplace," Levin says.

New Brands vs. Brand Extensions

Average Year-One Sales ($ Millions)*

* Across Food, Drug & Mass Channels (excluding Walmart)
SOURCE: SymphonyIRI New Product Profiler™

Extending sales through existing brands

New brands typically outperform line extensions in first-year sales. Still, in 2011, nine out of 10 of the top-selling new products were brand extensions, SymphonyIRI said. CPG manufacturers strived to curtail risk and expense by playing off existing brand equity. Among new food and beverage products, new brands generated $35 million in average year-one sales, compared with $22 million for new line extensions.

Going upscale with restaurant-quality foods
A downturn-driven trend toward home-based eating supported the launch of new gourmet entrees and indulgent treats at retail, including P.F. Chang's Home Menu frozen entrees, Lean Cuisine Market Creations and new upscale K-Cup coffee varieties and coffee creamers.

2011 New Product Pacesetters: Top 10 Food & Beverage Brands

Year-One Dollar Sales ($ Millions)*

1.
P.F. Chang's Home Menu
$101.6
2.
Thomas' Bagel Thins
$73.6
3.
Oscar Mayer Selects
$69.2
4.
Folgers Gourmet Selections K-Cups
$58.4
5.
M&M's Pretzel
$58.4
6.
Sun Drop
$55.8
7.
Kellogg's Special K Cracker Chips
$50.6
8.
Lean Cuisine Market Creations
$48.6
9.
Gold Peak Chilled Tea
$44.3
10.
Baileys Coffee Creamer
$44.2
* Across Food, Drug & Mass Channels (excluding Walmart)
SOURCE: SymphonyIRI New Product Profiler™; New products that completed their first year in calendar year 2011.

Delivering sweet indulgences
The top-selling new food products in 2011 included dinner solutions, meal makers and candy and gum. Mars produced four of the top 20 food Pacesetter brands, including M&M's Pretzel, which generated $58.4 million in year-one sales.

Most Active Food New Product Pacesetters

Product Usage Group as Percent of Total Food Pacesetter Dollars

Note: Numbers may not add to 100% due to rounding.
SOURCE: SymphonyIRI New Product Profiler™; New products that completed their first year in calendar year 2011.

Taking advantage of new technology

Non-food CPG manufacturers took advantage of new technology to create products with enhanced performance. Pampers with Dry Max, which uses technology to keep babies twice as dry, generated $296 million in year-one sales. L'Oreal has 12 New Product Pacesetters for the year, including Maybelline Fit Me facial cosmetics and Maybelline Volum' Express Falsies mascara, both of which landed in the top 10.

2011 New Product Pacesetters: Top 10 Non-Food Brands

Year-One Dollar Sales ($ Millions)*

1.
Pampers Cruisers and Swaddlers with Dry Max
$296.0
2.
Gillette Fusion ProGlide
$169.4
3.
U by Kotex
$74.6
4.
Schick Hydro
$64.9
5.
Maybelline Volum' Express Falsies
$46.5
6.
Nicorette Lozenge
$45.2
7.
Sally Hansen Salon Effects
$41.8
8.
Tide plus Febreze Freshness
$37.9
9.
Ensure with Revigor
$37.5
10.
Maybelline Fit Me
$36.2
* Across Food, Drug & Mass Channels (excluding Walmart)
SOURCE: SymphonyIRI New Product Profiler™; New products that completed their first year in calendar year 2011.

More than nine of 10 new foods and beverages launched in 2011 were line extensions.

 


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