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Taking aim: IRI's annual new products report shows that successful new products are becoming more targeted.

Article Excerpt
Now in its twelfth year, the annual Information Resources Inc., New Product Pacesetters report tracks the prior year's most successful new CPG brands. Less than one-quarter of new brands exceed the $7.5 million year-one sales hurdle required to earn Pacesetter status.

The New Product Pacesetters illustrate that despite low historical success rates, success is attainable.

How did they do it? New food and beverage brands offered convenient health and wellness solutions, as well as new varieties. Within nonfoods, breakthrough performance landed many of this year's Pacesetters onto the list, while others offered new scents, designs and targeted solutions that were embraced by consumers.

In nearly all cases, manufacturers leveraged the equity of well-established brands, rather than creating new brands. Further, manufacturers are increasingly developing new formulas, recipes and technologies as the basis for brand differentiation, rather than single benefits, such as a more basic flavor, that would be easier to replicate.

While down slightly from 2005's record number of introductions, 2006 was still one of the most active in recent history. Despite the high numbers, success rates remained consistent with rates over the past decade.

Less than one-quarter of introductions met the New Product Pacesetters hurdle of $7.5 million or greater in year-one sales. In fact, only 3% of food and beverage introductions and 1% of non-foods exceeded $50 million in their first year.

While these numbers are disheartening and clearly point to the need...

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