Trends Behind the Fastest-Moving New C-store Products
Health, Indulgence and Convenience Reign
Nearly 1,900 new products hit U.S. retail shelves last year, and only 11% met IRI’s benchmarks for exceptional first-year sales success. The 200 top-selling CPG launches of the year each captured more than $13 million in year-one sales across the multi-outlet geography, with an individual average of $39.5 million in first-year revenues.
Among the c-store New Product Pacesetters, a number of notable trends surfaced:
- No single product blew dollar sales out of the water compared to last year’s ranking, but the number of products over the $100 million mark was notable.
- While indulgence is certainly still a priority for c-store shoppers—case in point: Reese’s Minis and Magnum ice cream—many items in the top 10 touted better-for-you attributes. Fourth-ranked TruMoo has lower sugar than traditional flavored milk; Monster Rehab features electrolytes, coconut water and superfruits; Dr Pepper Ten touts only 10 calories; RockStar2x has lowered carbs; and Lipton has all-powerful “natural” on the label of its ready-to-drink tea.
- The blurring of eating occasions—and with it, the growth of snacking—appeared between the lines in this year’s ranking. IRI placed all new products together by consumption groups, and it found that while the breakfast grouping accounts for just 13% of overall CPG dollars, breakfast solutions account for one-third of total Pacesetter dollars. And of course, these “breakfast” items—such as Dannon Oikos yogurt, which ranked No. 1 for all other retail outlets, and Nature Valley Protein Bars at No. 8—aren’t necessarily consumed in the morning.
- While they didn’t make it on the c-store ranking be it for distribution reasons or otherwise, a number of products that placed in the total retail top 10 have a rightful place in the convenience channel. Yogurt, protein bars, frozen alcohol-beverage pouches, water enhancers and flavored waters are all hot c-store subcategories. It is in the c-store retailer’s best interest, says Viamari, to look at the multi-outlet top 10 for opportunities that have yet to be fully realized by the convenience industry.
- This year’s New Product Pacesetters also saw an increase in the number of small companies. “That’s very telling of changes that are going on in the industry,” says Viamari. “The playing field is more level now. Social media are enabling these smaller guys to get their word out there a little better.”
The Cycle of Innovation
Anyone who’s been burned by a new-product flop may question the true value of the next big thing. It’s important to understand and appreciate the ebbs and flows of the innovation cycle.
“A lot of innovation is intentionally a flash in the pan, just trying to keep the category exciting. So it’s going to be a new bell and whistle this year, and then there will be another bell and whistle the next year,” says Viamari.
“But then there are the breakthrough, blockbuster innovations—Greek yogurt or K-cups (single-portion brewing cups manufactured by Keurig and other companies)—that are really changing the way we view the category,” she continues. K-cups revolutionized coffee, and now manufacturers are building on its success with a bevy of flavors and even tea options.
“It used to be about innovating outside of the box; now, how can you innovate not only outside the box, but moreso within?” says Derek Gaskins, chief customer officer for 58-unit Rutter’s Farm Stores, York, Pa. For example, as energy products are established as a crucial category, “how do I target women, or millennials, or some other demographic with a niche vs. a whole new product category?”
To Gaskins’ point, innovation is also growing increasingly targeted toward niche audiences, resulting in successful rollouts with smaller sales outcomes. Take Greek yogurt. Last year, for the first time in a while, yogurt growth was very small, almost flat—not because the trend was dying, but because it was the year between the launches of Chobani and Dannon Oikos.