trend idtm Optimizing Trends Analytics for a New Era
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1 trend idtm Optimizing Trends Analytics for a New Era
2 Gluten-free. Non-GMO. Chia. We re all drowning in premium product attributes spreading steadily across the store. But which are really driving growth in your categories? It s a simple question but one that has traditionally lacked a nuanced tool to answer. trend idtm That s because syndicated sales databases do not contain enough metadata on products to accurately analyze the nuances of premium innovation in every category. So, in the absence of this, too many marketers are relying on their gut or on qualitative trends analytics. In both cases, it is very easy to misforecast demand for a niche product attribute that feels appealing and has 1 or 2 growing brands carrying it but which is not statistically correlated to growth. Essentially, it s very easy in our current information age to get distracted by highly niche product trends (e.g., kale) in the absence of hard data to measure their actual sales performance. Unlocking growth by challenging industry assumptions Category trends are not surfaced by counting new product introductions, since not all new products succeed in securing demand long term Instead, the product attribute is the key unit of analysis, as it is what premium consumers use to make key purchase decisions And the UPC, not the brand, is the key level of analysis, because many important growth attributes are not brandwide at all Category-by-category analysis of attribute growth is critical, because specific attributes (e.g., organic) can vary widely in their power to drive growth across categories Trend id is our proprietary process to surface the specific emerging product attributes driving growth in your category and to estimate their relative mainstreamability in the broader marketplace. Trend id Your Strategic Advantage Custom category lens ensures findings are applicable to your business Foundation of decades of consumer and cultural insights allow us to go beyond explicit product attributes those claims and ingredients explicitly listed on product packaging to uncover implicit attributes attributes that are not explicitly stated on the product itself but which the average consumer likely perceives because of other packaging or narrative cues (e.g., minimal processing) that matter in the category under investigation Identification of the category-specific attributes that are highly correlated to volumetric growth in the category and an understanding of what they mean in the eyes of consumers
3 RTE Popcorn Case Study We cannot imagine a better case than one of America s fastest-growing snack categories during the past five years: ready-to-eat popcorn. This formerly sleep land of state fair kettle corn has truly come alive with a phenomenal rate of product launches enabled by the minimal costs to entry in the space. It is one of those categories where it appears that almost anthing would grow, right? In fact, traditional trends analysis that focuses on tracking product launches would confirm that all sorts of different attributes are getting very high launch rates in the space. But are these products growing unit sales because of these attributes? Or are they just distribution-led businesses with no real pull? Select RTE Popcorn Growth Attributes in xaoc+c channels 1 minimally processed dairy/lactose-free claim vegan claim white cheddar nut-free claim etc. Implicit attributes matter: Minimally processed is one of the strongest attributes in the category because of a select few premium brands that have won over consumers with their non-industrial formulations using only kitchen-level ingredients for flavorings and oils. For years, we ve known that leading edge consumers are attracted to ingredient panels that lack any industrial additives. This desire is strongest in categories where the eating motive is health oriented and where the food is thought to be inherently simple like popcorn. 1 Source: Hartman Trend id for Popcorn-Popped, AC Nielsen xaoc+c channels, past four years, week ending 11/21/2015
4 Explicit attributes with subtle meanings: Dairy-free and vegan are essentially serving the same signaling purposes not only to vegan consumers but to a subset of consumers who simply believe vegan is implicitly lower in calories and healthier (and in the case of RTE popcorn, this is frequently true). While launches of cheese-flavored RTE popcorn have been plentiful, it is only the white cheddar UPCs that are growing well recently. Strong, spicy cheese reminds consumers of their overindulgence and the excess calories they ve just consumed: not a source of sustainable growth in a society with increasing anxiety about overeating. Attributes with lots of launches do NOT necessarily correlate with real organic growth = Trend id growth attribute presence correlates strongly to unit volume growth = Not a growth attribute presence is no guarantee of growth # of UPCs launched other indulgent flavor minimally processed cheese (ex. white cheddar) kettle corn white cheddar vegan nut-free dairy-free Source: Popcorn-Popped, AC Nielsen xaoc+c channels, past four years, week ending 11/21/2015 Most of the attributes with the biggest launch counts from 2011 to 2015 did NOT drive growth in unit volume, as this sample of our findings shows. The ones where launches and real growth did align, like minimally processed, generally did so because the brands launching the UPCs in question launched within a clear premium tier of quality in product design and with younger premium brands on the pack.
5 In the old days, counting launches was a way of gauging whether or not certain ingredient supplies or merchandising opportunities looked favorable for those thinking about entering a category. It was a metric pegged to an era when big manufacturers controlled supply chains and when major retailers only worked with big CPG companies. And it was a metric that worked when the market was far less competitive, hence launches perhaps better correlated with success. Today, this is simply no longer true. A better approach to trend measurement is needed in a low-growth market favoring new, premium entrants. Trend id is it. Two levels of insight based on your business needs: Attribute Identification (Trend id Base Report) provides insight into a category s key attributes and ingredients for product marketing, innovation, R&D Identification of attributes that are highly correlated to volumetric growth in their respective categories In-market product examples demonstrating growth attributes in natural channel Prioritization of growth attributes based upon Hartman Group s proprietary scorecarding method to determine potential for long-term mainstreamability Consumer Benefit Bundles (Trend id Premium Report) provide insight into current and future portfolio innovation and strategic acquisition pipeline Identification of attributes that are highly correlated to volumetric growth in their respective categories Alignment of growth attributes into culturally relevant consumer benefit bundles (e.g., Simple Nutrition) Category-focused consumer reason to believe for each consumer benefit bundle In-market product examples that illustrate consumer benefit bundle in natural channel Prioritization of the benefit bundles based on Hartman Group s proprietary scorecarding method to determine those most suited to mainstream adoption For more information, contact Shelley Balanko, Senior Vice President, at shelley@hartman-group.com.
A Consumer-Centric Growth Innovation Strategy for Premium Brands
disruption emerging from the edges culturally relevant growth defend to gain product attributes go-to-market strategy on trend % category Unit share A Consumer-Centric Growth Innovation Strategy for Premium
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