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July 2002 Times & Trends Executive Summary
New Product Pacesetters: Food Benefit Trends

Taste benefits have become a prerequisite among new food product introductions.
Nearly all (90%) of top new food product introductions offer a taste benefit – a distinctive flavor, texture or recipe--in their positioning to consumers. This percentage is up significantly from just five years ago when only two-thirds of new products featured taste benefits. In fact, taste is far more important today than low fat, reduced calorie and other “better-for-you” benefits. Bottom line: no matter what other benefits a food product may offer, it has to taste good.

Manufacturer's continual efforts to make busy lives easier are rewarded with strong sales.
Manufacturers have heard consumers’ “do-it-for-me” demands and have responded with numerous new products designed to make lives easier. Meal solutions that complete time-consuming preparation steps are thriving.  In the battle for share of the Dinner Solutions segment, bowl dinners, which even eliminate the need to wash pans and dishes, have come on strong.  Focused on simplifying, saving time and enabling our on-the-go lifestyle, manufacturers are continually “raising the bar” on convenience.

While the number of new “better-for-you” products has declined significantly, a recent growth spurt among mature brands in this segment may stimulate new interest.
In response to consumer apathy towards products with “better-for-you” benefits, such as reduced fat and reduced cholesterol, manufacturers curbed new product development in this area.  Only 11% of new food products in this year’s report had reduced fat benefits versus 38% in 1995-1996.  Yet, after several years of decline, sales of leading meal solutions with wellness benefits increased 2.4% in 2001 as consumers eat at home more since September 11. 

Restaurant brands find success in traditional CPG channels.
With year-one sales in excess of $110 million in supermarket, drugstore and mass merchandise channels, Boston Market’s frozen and shelf stable products and Starbucks coffee were the top two new food product introductions for 2000-2001.  Consumers clearly gravitate to brands and tastes they know.  Given the phenomenal success of these and other restaurant brands, expect more to follow. 

Variety stimulates and sustains consumer interest.
Since the inception of New Product Pacesetters in 1995, a majority (60%+) of new products profiled have offered variety – a range of flavors, recipes and other choices for consumers.  Variety has long been considered a critical success factor for new food products as it enables products to appeal to a broader group of consumers and sustain interest.

True innovation is worth the effort.
Most brand extensions (which comprise 89% of Food Pacesetters) offer “me-too” benefits, which already exist in the category, rather than truly innovative benefits.  An extensive analysis of 931 new products introduced since 1995 revealed that truly innovative products yield 56% higher sales than “me-too” products.  While “cloning” a category leader may be safer and faster, investing in true innovation is typically worth the effort.