Report: Long-Term Growth Eluding New Food Products, Fast-to-the-Masses Launch Strategies Have Struggled Over Past Decade

BELLEVUE, Wash., June 6, 2013 /PRNewswire/ -- While many recently-launched food products have enjoyed first year sales exceeding $100 million, none have become engines for long-term growth, according to a new report from Hartman Strategy, an innovation and strategy consultancy serving major food and beverage companies.

The report, entitled Riding the Killer Curves of Food Innovation, provides an industry-insiders analysis of innovation growth curves and is authored by James Richardson, a top executive at Hartman Strategy. The report is the latest installment of Hartbeat EXEC, a free quarterly report for executives within major U.S. food and beverage companies. A full copy of the report can be downloaded at www.hartmanstrategy.com/hartbeat-exec

Top Line Findings within Report

Written specifically for top executives within the consumer packaged goods industry (CPGs), the 12-page report provides industry data and expert insights that:

• reveal a majority of the highest-profile food products launched between 2003-2007 are still being sold today but only a third now have sales larger than they achieved in year one, none are both larger and growing, and the majority are in decline
• examines five common go-to-market approaches deployed by packaged food and beverage companies and how they fared after at least five years on the market
• concludes that new food products taking slow and strategic go-to-market trajectories were more likely to achieve long-term sustainable growth than similar products launched via rapid and high ACV distributions, often times with far better long-term results than products launched via mass distribution and marketing campaigns
• forecast a growing need for top CPGs to build separate organizations that identify, cultivate and manage slow-to-market food products that are well-positioned for long-term growth 

"In the food and beverage industry, reaching and exceeding first year sales of $100 million is widely accepted as the mark of a successfully launched product," said Richardson. "But, as far as we can tell, no one has ever systematically tracked how these products fared in the five year period following launch. The results were surprising."

Mini Case Studies Reveal Food Innovation Strategies of Top Brands

The report also takes a closer look at five different growth curves commonly deployed in today's food and beverage marketplace and how each correlate to different innovation approaches and go-to-market choices of top CPGs. Key characteristics of each growth curve are broken-out in detail and also reference specific food products that adopted each including:

The Bunny Slope: The 2007 launch of Golden Grahams Treats is an example of this growth curve; one that begins with a small and specific distribution channel and virtually no advertising or marketing budget.

The Sand Dune: The 2003 launch of Breyer's Carb Smart is an example of a growth curve that leverages very rapid distribution to the masses via its affiliation to already-popular products. Products on this curve typically get out of gate because of a fad, and then gradually decline to niche status and, in many cases, are simply pulled from the market altogether.

The Great Plateau: The market launch of Hormel Compleats is used as an example of this growth curve; one that's able to sustain initial launch velocities by serving a niche audience of consumers, but generally can not continue to grow beyond this niche.

The Skate Ramp: The 2007 launch of Chobani Greek Yogurt provides a classic example of a slow but steadily growing growth curve that is often used by makers of premium food products and is a potential disruptive force that can overturn established category leaders.

The Ski Jump: Tyson Any'tizers, Activia Yogurt and Campbell's Reduced Sodium Soups are three food launches that leveraged fast-build, mega launches to achieve a doubling in size in FDM outlets.

About Hartman Strategy

Hartman Strategy works exclusively with the largest and most-respected food and beverage companies to identify, create and seize growth opportunities that align with America's constantly evolving food culture. Hartman Strategy consultants partner with senior executives to develop long-term, incremental growth strategies that enable each client to capitalize on both current and emerging market demand.  The company is singularly-focused on the food and beverage industry and provide clients with access to three decades of research on eating behavior, consumer demand, and business strategy.  Our core capabilities include: corporate innovation strategy; analysis of market trends in U.S. food culture; and investment guidance on early-stage food and beverage companies.

FOR MORE INFORMATION:
 Dan Branley (206) 914-1231
[email protected]

SOURCE Hartman Strategy