Levels of new product activity have been holding up in the face of the difficult global financial situation, with the number of launches in 2008 ending up at a similar level to that in 2007, according to the Innova Database (www.innovadatabase.com).

Looking at new product activity as a whole, there have been some very interesting trends and developments, giving an insight into what we might expect to be the key issues for 2009. Innova Market Insights has identified its top ten new product trends for the coming year, as follows:

1. Trading Down and Up
2. Claims that are True
3. Balancing Act
4. Novel Niches
5. Up Close and Personal
6. Ancient is Modern
7. Seasonal Changes
8. Natural Progression
9. Not Without a Trace
10. Less Red Tape

Key trends identified by Innova Market Insights include:

Trading Down and Up

As the credit crunch bites and consumer confidence declines, consumers are increasingly turning to cheaper options, either in terms of shopping venues (the discount retailers) or of product ranges (own brands and value lines). One of the most interesting initiatives from the UK grocery scene, which is notable for the very high share taken by retailer own brands, has been the leading multiple retailer Tesco’s launch of a discounter range of tertiary brands originally developed for its central European stores. This new level of products sits somewhere between its Value and standard own-brand ranges, depending on the product, breaking the traditional and established economy-standard-premium pattern characteristic of retailer own brands in the UK.
 
The other mainstream multiple retailers in the UK have taken up the challenge in different ways, with initiatives such as Sainsbury’s Feed the Family for a Fiver with Jamie Oliver. Asda, meanwhile, is continuing to emphasise its position as the cheapest of the UK supermarket chains overall with an ongoing program of price cuts.

But while the financial crisis may be forcing consumers to cut back in some areas, certain sectors of the market may still benefit from a move towards eating out less but spending more money on food for in-home consumption. This could be in terms of buying higher quality meals or components rather than eating out, or reheating restaurant-quality fresh and frozen pizzas, rather than going for a takeaway or sending for home-delivery. Likewise, consumers may cut down on going out to the cinema, etc., and instead stay in and invite friends round, offering opportunities for more snacking products, particularly in sharing formats.

Balancing Act

2008 was a difficult year for functional foods, with growing pressure for claims substantiation tending to inhibit innovation and development. In some instances this has been replaced by products responding to the interest in “balance” and so-called “permissible indulgence,” whereby consumers want to eat well with the occasional treat and maintain a viewpoint of “everything in moderation.”

The further development of portion-control has been evident in the launches recorded by Innova Market Insights over the past year, particularly in the 100-calorie-pack market, which has seen a rising number of confectionery and snack products appear in this format in a growing number of countries, and in smaller snack or mini versions of existing products. The ice cream market was a good example of this in 2008 with the introduction of Unilever’s Mini Magnum and Mars’ launch of mini formats of its popular confectionery-branded ice creams, including Galaxy Minis and bite-size Bounty, Snickers and Mars in “A Little Bit of…” This latter launch was also positioned to create an ice-cream sharing market for those, highlighted above, who are staying in more as a result of the credit crunch.

Ancient is Modern

Another different approach to health is the rising interest in naturalness, authenticity and tradition, whereby product activity in ancient grains and foods produced using traditional ingredients and processes has experienced a resurgence. Quinoa, millet and spelt are perhaps the best-known of the ancient grains, but others still in widespread use in traditional societies and increasingly appearing in Western markets include amaranth, kamut, sorghum, teff and chia.

According to Innova Market Insights, launch numbers for products containing these grains have been rising markedly in recent years, led by interest in millet and spelt, ahead of quinoa.

“With rising awareness of their nutritional properties added to the unique and individual flavours offered by many of these grains, their appeal for consumers looking for healthier options and variety is clearly apparent, and companies are starting to use these grains in a wide range of food applications, including biscuits, baby foods, soups and confectionery, as well as launching the basic grains in a growing number of formats,” says Natalie Tremellen, an analyst at Innova Market Insights.

These are just three of the trends highlighted by Innova Market Insights that can help clarify the potential ways forward for your company for 2009 and beyond.

For more information on all ten trends, sign up for guest access to the Innova Database at www.innovadatabase.com/guestregister.aspx

For more information about Innova Market Insights, please visit: www.innovadatabase.com

Lu Ann Williams:     This e-mail address is being protected from spambots. You need JavaScript enabled to view it     Tel: +31 26 319 2000

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