Buyers eyed more than 122,000 new items in 2008

Articles
February 02, 2009

Buyers eyed more than 122,000 new items in 2008

Facts, not gut, drive category decisions. Yet the annual barrage of new products tests buyers, who rightfully view most as brand extensions or minor changes to existing products. Which ones to integrate or ignore? How to bring in the best ones with impact? These are just two questions they weighed on 122,743 new UPCs launched in the 52 weeks ended December 27, 2008. Buyers were effective: new items rang up more than $21 billion, or 5.7% of 20008 sales in U.S. grocery, drug and mass merchandiser stores (excluding Walmart) for the period, reported Nielsen. By sector, food and beverage items accounted for 39% of new-item introductions and $10.5 billion in sales; general merchandise contributed 29% of launches and $3.6 billion in sales; health and beauty care (HBC) represented 20% of new items and $3.9 billion in sales; non-food grocery yielded 12% of launches and $3.3 billion in sales. Health and wellness claims were popular among the nearly 50,000 new food and beverage items launched in 2008: 9.0% bore a ‘natural’ claim; 5.1% absence of specific fat; 4.7% organic; 3.7% no preservatives; 3.0% whole grain; 2.8% low fat; 2.7% cholesterol-free; 2.4% fat free; 2.0% reduced calories; and 1.9% gluten free.

Facts, not gut, drive category decisions. Yet the annual barrage of new products tests buyers, who rightfully view most as brand extensions or minor changes to existing products.

Which ones to integrate or ignore? How to bring in the best ones with impact? These are just two questions they weighed on 122,743 new UPCs launched in the 52 weeks ended December 27, 2008.  Buyers were effective: new items rang up more than $21 billion, or 5.7% of 20008 sales in U.S. grocery, drug and mass merchandiser stores (excluding Walmart) for the period, reported Nielsen.

By sector, food and beverage items accounted for 39% of new-item introductions and $10.5 billion in sales; general merchandise contributed 29% of launches and $3.6 billion in sales; health and beauty care (HBC) represented 20% of new items and $3.9 billion in sales; non-food grocery yielded 12% of launches and $3.3 billion in sales.

Health and wellness claims were popular among the nearly 50,000 new food and beverage items launched in 2008: 9.0% bore a ‘natural’ claim; 5.1% absence of specific fat; 4.7% organic; 3.7% no preservatives; 3.0% whole grain; 2.8% low fat; 2.7% cholesterol-free; 2.4% fat free; 2.0% reduced calories; and 1.9% gluten free.

Overall, consumers responded best to new snack items, which posted $2.07 billion in sales, or 18.2% of the entire category. Paper products comprised the only other category in which new items attracted more than $1 billion in first-year sales: the figure was $1.6 billion, or 15.2% of total category sales, according to Nielsen.

Areas of the store where new items proliferated, and merchants were pressed to make room, were led by: cosmetics, 5,212 new items yielded $311 million or 10.9% of category sales; candy, 5,133 new items generated $812 million or 10.7% of category sales; paper products, 4,274 new items produced $1.6 billion or 15.2% of category sales; bread and baked goods, 4,138 new items drew $348 million or 2.4% of category sales; and grooming aids, 3,755 new items attracted $170 million or 15.2% of category sales.

By contrast, many food categories depended little on new item introductions. Among them:  frozen juices and drinks, 18 new items yielded 0.1% of category sales; ice, 35 new items produced 0.2% of category sales; flour, 53 new items generated 0.2% of category sales; ethnic HBC, 47 new items drew 0.3% of category sales; and pickles/olives/relishes, 291 new items yielded 0.3% of category sales, the Nielsen data showed.

All 124 categories tracked by Nielsen had at least one new product introduction in 2008: most (105) had more than 100 new UPCs; 33 (27%) had more than 1,000 new UPCs; 56 (45%) rang up more than $100 million in new item sales.  Women’s fragrances (33.9%), men’s toiletries (24.9%) and baby needs (23.0%) showed the highest shares of new item sales as a percent of total category sales. And 38 of the top 100 new food items came from the snacks category.