Download the full report here<\/a>.)<\/p>\nMore than one-third of manufacturers (37%) say they are pumping up product development strategy<\/strong> over the next 12 months, while only 13% of retailers plan on taking on more national brand innovation than usual. However, more than a quarter of retailers will be hitting the gas on private brand innovation, a continuation of the private brand growth the industry has experienced over the past three years.<\/p>\nMost new products from national brands will target the mainstream and premium price tiers (59% and 37%, respectively) \u2014 not the value-priced innovation that retailers would like to see.<\/p>\n
Meeting Shoppers\u2019 Concerns<\/h2>\n
While high prices continue to be the top concern for shoppers, retailers and manufacturers are taking different tacks to address that. Nearly six in 10 manufacturers say they plan no price increases in the next six months, while 13% plan to lower prices on their non-core products. Meanwhile, more than a quarter of retailers plan to lower their everyday prices on a significant number of products.<\/p>\n
Szumlas highlights the importance of a well-defined portfolio strategy for manufacturers, emphasizing the need to incorporate tactics to support entry-level price point items.<\/p>\n
\u201cOnce a brand wins a customer\u2019s loyalty at that entry price, it becomes easier to introduce them to products in higher price tiers,\u201d Szumlas says. \u201cThis approach can effectively attract price-sensitive shoppers, build trial and encourage increased foot traffic to retailers. It\u2019s a strategic move to create both consumer engagement and sales opportunities.\u201d<\/p>\n
Retailers are also planning to draw more shoppers with their loyalty programs and in-store promotions. Over the next 12 months, retailers will be improving their loyalty offers, including increasing partnership programs and adding more perks, according to the Advantage Outlook report. They\u2019ll also be increasing their use of digital coupons and the frequency of promotions.<\/p>\n
\u201cGiven how far inflation has gone over the last few years, it has really challenged manufacturers and retailers to take more innovative approaches in the value propositions that they’re presenting to shoppers,\u201d Szumlas says. \u201cWe\u2019ll be watching to see how these latest strategies will pay off.\u201d<\/p>\n
Making a Positive First Impression<\/h3>\n
The retailer focus on private brands is connecting with consumers: According to the latest Private Brand Intelligence Report, 87% of shoppers today say they buy private brands during every typical grocery trip.<\/p>\n
On the manufacturer side, 57% of national brand innovation will be line extensions, while almost one quarter will target new categories.<\/p>\n
When it comes to evaluating the success of new products, manufacturers think they have more time than retailers do to assess whether a launch is successful or not. Less than half of manufacturers and more than three-quarters of retailers say that new products have a life span of seven to 12 months after launch before they are considered to be underperforming.<\/p>\n
That gap between how retailers and manufacturers evaluate new products needs to be addressed, says Szumlas.<\/p>\n
\u201cIt\u2019s critical for manufacturers and retailers to align on innovation evaluation criteria before new items hit the shelf,\u201d she says. \u201cA successful innovation launch plan should include pre-defined success criteria and contingency plans through the first full year on shelf, and even an exit plan if the new item doesn\u2019t meet expectations.\u201d<\/p>\n
The Advantage Outlook is published quarterly and produced in collaboration with Nielsen IQ.<\/p>\n","protected":false},"excerpt":{"rendered":"
As the rate of inflation continues to slow, retailers and consumer packaged goods manufacturers are ramping up efforts to appeal to value-conscious shoppers. Product innovation \u2014 for both national brands and private brands \u2014 and pricing shifts are leading the way, although the ways in which retailers and manufacturers approach these strategies are markedly different, […]<\/p>\n","protected":false},"featured_media":2361,"menu_order":0,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"mrktblog-category":[41],"class_list":["post-2362","mrktblog-posts","type-mrktblog-posts","status-publish","format-standard","has-post-thumbnail","hentry","mrktblog-category-advantage-news"],"acf":[],"yoast_head":"\n
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