1. Shopper & Customer

Building Buzz: Why New Products are Essential for Retail and CPG Success

Lisa Maas, principal and practice lead, Circana
Joan Driggs, vice president of content and thought leadership, Circana

Who among us hasn’t stopped short in a grocery store aisle, shopping cart wheels screeching, because a new product — seemingly created to fulfill a very specific recent craving, need, or void — suddenly catches your eye. Maybe you snap a photo of it for your group chat or your Instagram story while you’re still in the store (if you haven’t caused a traffic jam).

Or perhaps a digital ad from a well-known influencer popped up in a social feed and led you to pull over at a convenience store to hunt down that new energy drink with a unique flavor experience. Either way, you’re buzzing from the dopamine hit that accompanies discovering something new and exciting and sharing it with someone you know will love it.

If these consumer experiences resonate with you, it should be easy to understand why new products matter and why Circana has published its 29th annual New Products Pacesetters report. New products are essential for retail and CPG success because:

  • They help to address evolving consumer needs in innovative ways, and foster shopper loyalty for those retailers carrying those relevant products, giving shoppers a reason to visit the store and keep their dollars within the chain.
  • They give shoppers something new to talk about and provide an avenue through which they can engage with retailers and build relationships.
  • They create energy and enthusiasm for the category. Overall, 14% of Pacesetter survey respondents said they are early adopters who like to have the newest products, with 25% claiming to be early adopters of food products.
  • New products drive growth and contribute significantly to sales and revenue. Products that achieved Pacesetters status in 2023 accounted for an 18% growth contribution to total multi-outlet sales, compared to 11% in 2022.

Success in new products requires innovation

Being “new” isn’t enough to ensure new product success across food and beverage and nonfood CPG sectors. New products that made our Pacesetters list did so because they relied heavily on innovation to anticipate and respond to major shifts in post-pandemic consumer behavior as well as economic forces like inflation, which drove consumers to demand more value from their purchases.

Across food and beverage and nonfood CPG categories, we saw some common themes in the most innovative products that should continue to be areas of opportunity in the future.

More is more
As consumers continue to grapple with inflation, they’re looking for products that provide the perception of added “value” or additional benefits. We saw this in several categories, from beverages to oral care to laundry products. For example, consumers have been demanding functional benefits from beverages for years. But in 2023, Pacesetter products offered more benefits around hydration, zero sugar, added electrolytes and essential vitamins, and gut health, which we saw with Gatorlyte Zero, Electrolit, Gatorade Fit, Olipop and Poppi. In the laundry detergent aisle, successful new products including Gain+Odor Defense and Tide Ultra OXI with Odor Eliminators, don’t just mask odors – they actually eliminate odors embedded deep in fabrics. Toothbrushes that showed up as Pacesetters weren’t just toothbrushes – they were “oral care personal trainers,” such as the Oral-B iO series of Bluetooth-enabled electric toothbrushes that track brushing habits.

Post-pandemic behavior
Most of the products on this year’s list were developed during the pandemic and anticipated a world where consumers increasingly returned to hybrid workplaces and a “new normal.” The end of home-centric lifestyles precipitated demand for on-the-go snacking whether indulgent or permissible (mini Doritos, Cheetos, and Sunchips sold in canisters, Nutella B-ready, Junkless Foods, Nature Valley Crunch Dipped), convenient dinner solutions (Kevin’s Natural Foods refrigerated entrées, Ben’s Original Ready Rice Jasmine, Birds Eye Microwave roasters), and a desire for more convenient specialty coffee in the home, which we saw with Starbucks by Nespresso for Vertuo.

The rise of parents
The baby boom and spike in pet adoption during the pandemic created an opportunity for CPGs to innovate with products for growing families. Like other categories, brands that infused new products with added benefits, like the immune nourishing prebiotics in Similac 360 Total Care infant formula, or elevated baby foods in ultra convenient pouches, like the Serenity Kids line, performed well. Savvy brands that understand how much pet parents consider their pets to be members of their family (up to 50% of pet parents according to Circana data) – and market their products accordingly – earned Pacesetter status.

For a deeper look at all these trends, check out Circana’s 2024 New Products Pacesetters Report, which is available here. And don’t forget to watch a recording of our webinar, which takes a deeper dive into the brand and marketing stories of the products featured in our report.

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