New is not easy to do

Posted by Oliver Koll on Oct 23, 2014

Folie6The positive impact of innovations on brand success is well-known: By enhancing a brand’s equity, they justify the price premium, attract buyers and help to contain private labels. We looked at the trial and share impact of 90,000 innovations launched in seven European markets.
Ignoring short-term launches (like seasonal offers) we find that
a. 7 out of 8 innovations are minor – adding a new pack size or  flavor average.
b. Just under 70% of these innovations survive the first two years.
c. The average trial rate after 24 months is around 1.5%.
d. Private Labels innovate as much as brands
e. Major innovations have a much stronger share and growth impact.
f.  Growing brands innovate more.