February 2, 2010
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| Lynn Dornblaser |
The economic slump paid its toll on U.S. food and drink manufacturers in 2009 as companies launched 30 percent fewer new products compared to the prior year, according to a Mintel’s review of its Global New Product Database (GNPD).
In clear correlation with the recession, however, products that boasted an “economy” claim increased by 72 percent from 2008 to 2009.
“In the last decade, Mintel GNPD has only tracked occasional small declines in new product introductions for the U.S. market, never a decline as strong as this,” noted Lynn Dornblaser, leading new product expert at Mintel. “We see that a number of small companies, which typically introduce a wide range of products, have been stopping or slowing their introductions due to the economy. Additionally, some categories have simply become so over-saturated that there is little room for new products.”
Despite this declining trend, there are some categories that found hidden niches. Ethical and environmental claims increased from 9 percent of all product launches in 2008 to 17 percent in 2009. Specifically in this category, the environmentally friendly packaging claim nearly tripled, growing from 3 percent of all products launched in 2008 to 9 percent in 2009.
“The increase in ethical and environmental claims is less about companies introducing new products or changing their packaging and more about manufacturers communicating with their consumers and knowing what’s important to the people who purchase their products,” Dornblaser said.
In addition, side dishes was one of the few categories of food and drink that saw an increase in 2009, with 16 percent more launches than in 2008. This increase is most likely due to more people eating in and the introduction of products that offer convenient solutions, such as vegetable steam bags, according to Mintel.
Still, most categories saw decreases due to the down economy, said Dornblaser: “Natural and organic products, which saw large increases in 2008, took a few steps back in 2009 due to their higher price points.”
Food and drink introductions with an all-natural claim decreased from 15 percent of all launches in 2008 to 13percent in 2009. The organic claim, showed a similar decline of 12 percent to 10 percent in the same timeframe.
SBD Views: This data reminds me of Danny Wegman’s presentation at the FMI Private Brands Summit in June where he showed how CPG’s were cutting back on investment at the same time store brands were growing in quality and sophistication. Can we be headed for a time where store brands are perceived as having superior quality and national brands are perceived to be inferior? Call me crazy, but I remember when the phrase Made in Japan meant “it’s cheap” and Made in the USA meant there was none better. If current trends continue, we may very well be headed towards the Age of Store Brands.
––John Failla for Store Brands Decisions