By RDBA CEO Phil Lempert
Mintel reports that in 2014 more than 14,000 new food and drink products from both large and small companies were introduced in the U.S., and of these only 40 percent were truly new – the others were a combination of new flavors, new packaging, new formulation or a relaunch. The sad fact is that between 85-95 percent of all these new food and drink products actually fail.
One wonders just why Frank Sinatra’s Pasta Sauce didn’t make it, while Paul Newman’s line of food and beverages now has over 100 products and is quite successful. Dennis Rodman had lollipops and Bing Crosby tried ice cream. Phyllis Diller was ahead of her time as a crusader for great tasting food in the early 1980’s with her branded chili that contained no sugars, preservatives, fillers or “other things I can’t pronounce.” David Letterman, who in his youth worked in a supermarket, often showcased new products found throughout the country in a segment called Supermarket Finds – including Tony Packo’s Hot Dog Sauce with beef featuring Jamie Farr’s face on the label, Mushy’s brand of canned peas and yes, even Diller’s Chili.
As we witness consumer trends changing the food world (such as shorter and better quality ingredient labels along with more exotic flavors led by the food-passionate Millennials) the question is how can we predict which will be a hit and which a miss. Which ones do you as a retail dietitian want to push your buyer to stock and your customers to buy? A fundamental flaw in product development is not separating out those products that are part of a trend or simply part of a fad. Brands have made a lot of money jumping on the fad of the moment (think sriracha or kale). The trick is to know when to get out before the market disappears.
Trends are identifiable and explainable. There is little question that for soda brands their declining sales of carbonated soft drinks are due to consumers concerned about and wanting to curb the amount of sugar or artificial sweeteners they are drinking coupled with science that suggests both these ingredients may be harmful to health and waistlines.
Products that are on trend usually are consistent with lifestyle trends, grow slowly and have multiple brands entering the category. A perfect example of this is the rise in plant and insect proteins that are being used for ingredients and stand-alone products for their health benefits, lower cost as compared to animal proteins, and their sustainability profile that has far less impact on the environment.
Fads on the other hand typically play off the hype and the emotional need to purchase a product. Cronuts, cragels (half bagel/half croissant), rainbow colored bagels, bacon & cheese deep-fried crickets and self-heating cans of celebrity chef coffee are all examples of ethereal or ill-conceived benefits with limited appeal. Often these are produced by a single brand with limited appeal – the result is that the faddish product gets publicity, sees a spike in sales and then dies rather quickly.
We are also witnessing Silicon Valley embracing the food industry especially in the better-for-you categories – from farm to delivery to meal kits to our tables. While these new food entrepreneurs are seeing the foods we eat through a different lens we need to remind them that a successful food brand is built on a trend and not a fad.