new food products


What is The Success Rate of New Food Products?

The success rate for new food products at retail can vary widely and depends on several factors, including the type of product, the market segment, consumer preferences, marketing strategies, and the overall quality of the product. There is no one-size-fits-all answer to this question, as success rates can fluctuate over time and across different regions and markets.

However, it’s important to note that the food industry is highly competitive, and launching a new food product can be challenging. Market research suggests an 80% failure rate. With so many new food products failing to gain traction in the market and the resources available to entrepreneurs today it is surprising that the reasons for failure have not changed as much as we might expect.

Consumer Preferences: If the product doesn’t align with current consumer trends, tastes, or dietary preferences, it may struggle to find a market, or it can also be that the market can’t find you. You have a listing in retail, but consumers are just not aware of where to find you in the store.

Quality and Taste: The taste, texture, and overall quality of the product must meet or exceed consumer expectations. A subpar product is likely to fail. Most new products have evolved from a great taste USP however, in today’s competitive environment brands require more than great taste to win. Consumers want sustainability, price, packaging, etc. to all be superior to what they are currently purchasing in order to shift brand preferences.

Marketing and Branding: Effective marketing and branding are crucial for introducing a new food product to consumers. A strong marketing strategy can make a significant difference to a product’s success. Gone are the days of the 30-second commercial on prime-time TV. In many ways, social media is accessible to many of us, but keep in mind it too takes time and or funding to keep ahead of your competitors.

Distribution: Getting the product onto store shelves and making it readily available to consumers is essential. If distribution is inadequate, it can hinder a product’s success. Discussions with the team at Foodbizwiz confirm getting a listing is just your first step. As the manufacturer of your brand, you need to participate in activities to have consumers go into a store to buy your brand and continue to purchase it. Understanding this role is imperative.

Competition: The food industry is crowded, with many established brands and products. Competing with well-known brands can be challenging for newcomers. One of the biggest reasons is that larger brands have a history and the funds to compete, but keep in mind not every brand at a large organization is well funded, and sometimes innovation can upend a market brand leader.

Regulations and Compliance: Meeting food safety and labelling regulations is essential. Failure to do so can lead to product recalls and damage a brand’s reputation. Recalls can also cost the brand manufacturer a lot of money as retailers penalize you for a re-call.  Having a regulatory agent on call is important when you are creating your brand, and they can help immeasurably upfront, so you don’t get into trouble.

Economic Factors: Economic conditions, including inflation, consumer spending habits, and market dynamics, can influence a product’s success. We know that there will always be premium brands with premium pricing, and everyone hopes their brand can be part of this target market as it provides ease on your margins and allows you to have funds to spend on marketing.  But sometimes a price brand is needed to take a share out of the market leader.  The marketing rule does suggest that as competitors enter a category, they take market share, but they can also contribute to the growth of a category.   Where does your brand fit? Consulting with Christine Couvelier, our market trendologist, can help in understanding this critical equation in market dynamics.

Timing: Launching a product at the right time can be critical. Seasonal and trend-related products may have a limited window of opportunity. Today we do buy suntan lotion in December. However, understanding your consumer’s buying patterns and market research is critical to understanding timing.

Given the complexities and uncertainties involved, the success rate for new food products can be relatively low. Some sources estimate that as many as 70-80% of new food products fail within the first year. However, it’s essential to recognize that some products do succeed and become highly profitable for their manufacturers.

To improve your chances of success, food companies often conduct market research, invest in product development and testing, build strong marketing and distribution strategies, and adapt to changing consumer preferences and trends. Market research and consumer feedback are valuable tools for understanding what will resonate with consumers and increase the likelihood of a product’s success. Join Food Biz Mentoring Start-up Stronger Workshops to help you increase your chances of success.