The pace of invention in new products is being dictated by millennials.
The process of developing new food and beverage products is beginning to show the affects of millennial consumers and the influence of their purchase decisions. The findings were released on April 16 during the annual Growth Summit of Information Resources, Inc., a market research business, in Las Vegas. The report was titled New Product Pacesetters.
During an educational session addressing the findings, Susan Viamari, vice-president of Thought Leadership for I.R.I., stated, “Changing demographics are changing the product development process.” “Millennials are opinionated, well-off, and in search of new products that will help them solve problems and have experiences.”
According to her, 40% of the New Product Pacesetters for 2017 had an excessive millennial index.”They are genuinely transforming the market, and they make up one-third of CPG sales overall,” the spokesperson stated. “They are better connected and more educated—women especially. They search for everything on Google and have access to a wealth of knowledge.
The concept of a successful product launch is evolving due to modifications made to the process of product creation. The New Product Pacesetters report states that the next $100 million new product launch is not what defines new product success. It all comes down to creating lifelong relationships, and producers of consumer packaged goods must make investments in innovation that fosters these kinds of connections.
Only one product, Halo Top, produced sales exceeding $100 million in its first year of release among the food and beverage New Product Pacesetters. According to Ms. Viamari, this is a sign of a pattern that has been happening for some time.”The median sales (of first-year products) in the food and beverage industry this year were $14.5 million,” she stated.
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Millennial customers seek out items with ingredients they believe to be natural in addition to experiences and advantages.
According to Ms. Viamari, “new products that embrace the natural phenomenon” move them. “Millennials are more influenced by natural ingredients than are older consumers. In fact, this is encouraging more organic creativity.
Good Thins crackers from Mondelez International, Nestle Splash bottled water, Lifewtr from PepsiCo, Inc., Hillshire Snacking from Tyson Foods, Inc., and Well Yes! soup from Campbell Soup Co. are among the products ranked in the top 10 of this year’s New Product Pacesetters list.”By bringing these brands to market, marketers are earning a premium,” Ms. Viamari continued.
The idea of wellness for millennial consumers aligns with natural ingredients, but Ms. Viamari stressed that indulgence plays a role as well.
“Healthy and indulgent are becoming increasingly muddled,” she observed.She cited Yoplait Dippers and Larabar Bites, two products made by General Mills, Inc.
The triumph of recently introduced brands in the market is another distinctive feature of this year’s New Product Pacesetters list.
According to Ms. Viamari, “just five years ago, an estimated nine out of every ten Pacesetters launched were extensions of existing brand lines.” 25% of non-food Pacesetters and 40% of food and beverage Pacesetters in 2017 were completely new to the C.P.G. marketplace. This amply illustrates the desire of consumers to explore “unknown” brands. Particularly millennials are less inclined to make purchases based only on brand name and are more moved by experiences and solutions to their requirements.Delivering goods and messages at the appropriate times and places is ultimately crucial to the success of new products.
“The challenge doesn’t end there—innovating to meet core needs and wants is crucial to ensuring new product success,” the speaker stated. “Marketers must make sure that the product and messaging are where consumers are when they are ready to buy in order for a new product to be truly successful. CPG marketers are able to see where consumers go to discover about new items, which retail banners have the greatest potential, and even where the highest potential locations could be found within each of these banners, thanks to big data and advanced analytics.
“Marketers can influence purchase decisions with knowledge of key shoppers, including what they want, where they go to learn about products, and where they go to try new brands.”