Innovation boosts UK soft drink sales

Innovation contributed GBP162m or 2.3% to record beverage sales of GBP7.1bn for 2003, the new Britvic Soft Drinks Category Report reveals.

The long hot summer was responsible for about half of total sales volume, which was up 11% in both take-home and on-premises categories to 6,824m litres and 553m litres respectively. Sales value in each category breached the GBP5bn and GBP2bn marks for the first time.

Still drinks outsold fizzy drinks for the first time, due largely to a 20% growth in value.

Coca Cola, Robinsons and Pepsi filled the top three slots by sales value, but the fastest-growing brands were Volvic, Lucozade, Fanta and Evian.

There were about 300 new entrants to the soft drinks market last year, but consumer conservativeness and competition for shelf-space meant few survived. “innovation in terms of brand and flavour development accounted for less than 4% of the value of the soft drinks market, despite accounting for almost 15% of current soft drinks lines,” the report says.

Sales of Vanilla Coke, launched in March 2003, contributed almost one-third of the total GBP612m sales attributable to innovation, with five other brands kicking in another one-third. Other key launches were Fanta Zesty Berry, Pepsi Twist, Tango Fruit Fling, Fruit Shoot Apple, Red Bull Sugar-Free, Sunny Delight no sugar added, and Lucozade Hydroactive.

Health and functionality still drive innovation in this sector. But Andrew Marsden, Britvic’s category director, reckons it will pay firms to resegment the market in terms of shoppers’ buying habits with respect to point of purchase. Think out-of-town, convenience and high street, rather than cola, juice, dairy, etc.

“Consumers are more health-aware but they are prepared to pay more to indulge themselves. This makes premiumisation an important factor in raising profitability,” he says.

Less bang for the buck
Japanese make progress with novel foods
Zippers are clean

Innovation

Less bang for the buck

A 90% failure rate is a damning indictment of how companies measure and do innovation.

This is the view of Peter Flentov, founding partner of 20/20 Innovation, a Boston-based innovation consultancy. Writing in Always On, he says “Each year the US spends more than $260bn on “innovation” (as measured by R&D expenditures) – globally the amount spent on R&D exceeds $600bn per year. The outcome of this investment in innovation is prodigious. Over 100 new patents are applied for each hour, and 2,265 new businesses are started each day. An estimated 80-100,000 new products are introduced in the US alone each year.

“But the results are dismal at best. The typical supermarket carries somewhere between 30-40,000 items. In 2001 32,025 new lines hit supermarket shelves. That’s roughly the total number of SKUs stocked.

“Marketing Intelligence Service, a business unit of Ogilvy & Mather, tracks new consumer packaged goods introduced to the North American market. It has developed an Innovation Rating to measure whether a new line offers consumers a meaningful difference from existing products.

“To be considered innovative, a new product has to offer the consumer significant new or added value in one of the following:

• - new positioning to reach new users or new ways of use

• - providing a new customer benefit through new packaging

• - introducing a new formulation

• - adding new technology to the product

• - opening a new market for the product

• - new merchandising methods to sell the products

“In 2001 only 7% of the new products introduced to supermarkets, about 2,000, qualified as “innovative” based on MIS’ Innovation Rating criteria. According to market researcher ACNielsen, 93% of consumer goods are no longer on the shelf 12 months after launch.”

NPD

Japanese make progress with novel foods

Japanese food researchers have unveiled a number of novel foods and their effects.

The Agriculture and Livestock Industries Corporation (ALIC) has developed a new functional fermented soybean paste (miso) with four times the angiotensin-converting enzyme (ACE) inhibition activity and three times the content of calcium of the regular miso. The ACE inhibition activity is expected to prevent hypertension.

The miso, developed in collaboration with the University of Miyazaki, Itoham and Yamae Foods, includes more amino acids than typical miso because skim milk is degraded and fermented thoroughly in the fermentation process.

Meanwhile, researchers at food conglomerate Kagome and the National Institute of Health Sciences (NIHS), have shown that beta carotene derived from carrots is an antiallergic. This means that carrot juice may help prevent and treat allergy including hay fever. They will present details of the finding at the Pharmaceutical Society of Japan on 29-31 March in Osaka.

In addition the US Food and Drug Administration (FDA) has granted GRAS status to CSPHP, a soy protein/phospholipid complex system that may help maintain healthy cholesterol levels made by the Kyowa Hakko Kogyo.

CSPHP, an abbreviation for C-fraction soy protein hydrolysate with bound phospholipids, is a newsoy peptide. Japan’s Ministry of Health, Labor and Welfare has approved beverages that contain CSPHP as a Food for Specified Health Use (FOSHU).

CSPHP comes in tablet or granule form. It is an ingredient in baked goods and baking mixes, breakfast cereals, dairy product analogues, fats and oils, grain products and pastas, functional food and beverages, meat products, milk products, plant protein products, processed fruits and fruit juices, processed vegetables and vegetables juices and soups and soup mixes.

Packaging

Zippers are clean

European packaging firms Supreme Plastics and Amcor Flexibles EuroPouch have developed a zipper for retortable applications.

This gives manufacturers the ability to produce multi-portion, resealable pouches of moist foods, from fish to petfood.

The zipper will work with viscous products to withstand temperatures of up to 129 degrees C for 45 minutes, making it particularly suitable for packaging foods that until now have been presented in cans or jars.

The use of resealable closures in food packaging has grown steadily with the increasing popularity of stand-up pouch formats, which replace traditional cans, jars or cartons, minimise packaging volume and increase sales impact. 

Switching from metal and glass to retortable, flexible packaging reduces storage requirements and lowers transport costs. In addition, heat transfer is faster in plastic and the food retains its flavour superbly through a shorter cooking time, say Supreme spokesmen. The zipper uses a modified polymer blend that resists distortion during the sterilisation process, resulting in an effective closure that is not too rigid.

Jonathan Fowle, Amcor Flexibles' group director of innovation, design and marketing says "The retort zipper opens up new opportunities for consumer convenience and portion control. On-the-go eating and food service applications are major target areas.”