Launching new products is difficult in the best of times, but winners of the 2012 Nielsen Breakthrough Innovation Award found ways to succeed during one the worst recessions in a generation.
Nielsen announced recipients of the awards at its annual Consumer 360 event in Hollywood, Fla., this week after analyzing more than 11,000 new products in the United States between 2008 and 2010. Of the products evaluated, only 34 met award criteria. These products comprise less than 0.5% of all new product introductions during the period.
The 2012 Breakthrough Innovation winners were classified in tiers consisting of the following:
Platinum: Zyrtec, Bud Light Lime, Arnold Select Sandwich Thins for 2008, Chobani and Prevacid24HR for 2009 and Glaceau vitaminwater zero for 2010.
Gold: Nature Sweet Cherubs, Powerade ION4 Zero, Wonderful Pistachios, Tide Total Care for 2008, SoBe 0 Calorie Lifewater, Trop 50, Trident Layers, Plan B One-Step, Budweiser Select 55, Next Choice, Dove Men+Care for 2009 and Silk PureAlmond Milk, Thomas’ Bagel Thins, U by Kotex, PF Chang’s Home Menu, Schick Hydro for 2010.
Silver: Keebler Town House Flipsides, Miller Genuine Draft 64, Always Infinity, K-Y Yours+Mine for 2008, Nature Pride Variety Bread, Olay Professional Pro-X, Align Probiotic, Tide Stain Release, Fancy Feast Appetizers for 2009 and Special K Fruit Crisps, Oscar Mayer Selects, Lean Cuisine Market Collection for 2010.
Nielsen said its innovation awards are in contrast to those that focus on “one-year wonders,” because its program honors new products that succeed on multiple dimensions over a three-year period. This is the first year Nielsen has presented the award.
“To successfully launch a new product in any economy is beating the odds, but to launch and sustain success during a recession is remarkable,” said Vicki Gardner, SVP product innovation for Nielsen. “Breakthrough Innovation Award winners have unique bragging rights among CPG innovators.”
To be considered, honorees were expected to deliver on such attributes as distinctiveness, relevance, category impact and endurance. Although the study was conducted at the product level, there were companies whose successes underscored an organization-wide commitment to ongoing product innovation. For example, Procter & Gamble led the way with five initiatives making the list. Anheuser-Busch, Coca-Cola, Johnson & Johnson, Kellogg, Nestlé, PepsiCo, and Unilever each had two initiatives.
Winners followed multiple paths, but shared common themes. One trait shared was the understanding that getting it right the first time is neither likely nor important. Winners built a test-and-refine process to build in iterations before launch. Also, breakthrough Innovation leaders followed one of two activation models that Nielsen identified as sprinters or marathoners.
Sprinters were products that raced out of the gate in year one, then allowed momentum to sustain in-market performance in year two. Marathoners were products that deliberately start out at a slower pace and build on their success in subsequent years.
The typical sprinter profile is a larger company not straying far from the existing portfolio. They price at a premium, are aggressive with in-market trial and average nearly $50 million in one-year traditional advertising spend. After racing out of the gate, sprinters take their foot off the accelerator in subsequent years, shifting focus from growth to profitability.
Marathoners tend to be smaller companies who spend one-third as much on advertising in year one, but build support in year two, realizing an average of 80% growth in the second year.
For Profiles of the winners or to download a copy of the 2012 Breakthrough Innovation Report.