Stale economy slows new product launches
January 26, 2010
by Bryan Salvage
CHICAGO — Food and drink product launches showed a substantial decline of nearly 30% in 2009 from 2008, due primarily to the ongoing economic slump, according to a recent review of Mintel’s Global New Product Database (G.N.P.D.).
“In the last decade, Mintel G.N.P.D. has only tracked occasional, small declines in new product introductions for the U.S. market, never a decline as strong as this,” said 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.”
Some categories and product claims, however, found a hidden niche in which to excel. For example, ethical and environmental claims increased to 17% of all product launches in 2009 from 9% in 2008. The environmentally-friendly packaging claim nearly tripled, growing from 3% of all products launched in 2008 to 9% 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,” Ms. Dornblaser said.
Products featuring an economy claim have increased by 72% from 2008 to 2009.
The side dishes category saw an increase in 2009, with 16% more launches than in 2008. This increase is probably due to more people eating at home and introducing products that offer convenient solutions. Most categories, however, suffered decreases due to the recession.
Natural and organic products, which experienced large increases in 2008, retreated in 2009 due to their higher price points, Ms. Dornblaser said. Food and drink introductions with an all-natural claim decreased from 15% of all launches in 2008 to 13% in 2009. The organic claim, showed a similar decline of 12% to 10% in the same timeframe.