What drives established engineering products to spend valuable resources (time, money, human capital, etc.) on new product development. Here are six reasons to invest in new product development.
Staying ahead of the competition should always be front of mind for existing companies. New products give you a competitive advantage over your competition. It might be new sales, more shelf space, consumer impressions or other advantages. If you are the market leader, you want to keep your competitive advantage, if you are not the market leader – you need a competitive advantage. New products allow you to focus on taking a competitive leadership position. There’s leadership position in the nut category is clear and their continued focus on new products keeps them in front. Their new dessert inspired mixes are definitely look mouth-watering.
Speaking of competitive leadership, there is the credibility that comes with being the category innovator. Innovative companies are thought of as creative and ground-breaking bringing more excitement to their brand and solving consumer problems. Being first is always better than needing to flatter your competition by replicating something they did first and you wish you had thought of earlier.
Every brand wants more sales and new products help. New items might not be your number one SKU driving the most sales, but they drive new sales to your brand or category and they provide a continued look at existing products consumers may have forgotten about keeping your brand front of mind. I’m sure watermelon flavored Oreo’s are not their best seller, but each new offering generates loads of consumer media attention and new purchases.
Reason to See Your Buyer & Engage Your Consumer:
Depending on your category you might see your buyer one to four times a year…maybe monthly if you’re lucky. During those meetings you probably discuss general category data including pricing, promotions and performance, but what about products. Same story different day doesn’t create a lot of reason for the buyer to schedule an extra meeting with you or give you more business. New products on the other hand generate new discussion and new opportunities.
Test Consumer Trends
Consumers are constantly evolving which means their tastes and preferences change with them. In recent years we’ve see probiotic foods, gluten free, and paleo emerge as just some of the important consumer food trends. Your ability to maintain an active focus on innovation and stay current on trends allows you to be ahead of the curve with emerging consumer trends and test new concepts in early stages of trends and refine them as the trend becomes mainstream. This test and refine concept allows you to see what concepts have potential and which were fleeting while still maintaining a competitive advantage.
Just like consumer trends drive new products, advances in technology drive new opportunities in various food products as well, typically in the area of food packaging. Food packaging and processing advances have opened up entirely new product opportunities. Your innovation, production and marketing team should constantly be exploring new technology that will aid in new product development.
New product development doesn’t have to be costly, but it must be a priority. Just like we talked about the power of building a marketing-minded culture, it’s equally important to include innovation as part of that ideal to foster continued organizational growth.