CPG Product Innovation Begins in the Natural and Amazon Channels

March 16, 2022
by SPINS Marketing

3 Questions Omni-Intelligence Data Can Answer

CPG product innovation is at the heart of a successful brand. Without it, your brand gets left behind as consumers seek out products that meet their current needs. Consumer tastes change, trends rise and fall, and other brands change the game. You want your brand to stay relevant. That can mean introducing a new product or updating an existing one.

How do you begin to strategically innovate so you create a product that customers want? Go to the source.

Natural and Amazon Channels Set the Trends

Shoppers in the natural and regional independent grocery (RIG) channels are the first adopters in the market. They seek out specialty ingredients, try new diets, and often opt for brands they can’t find in big box stores. Amazon shares some of those discerning shoppers—especially because online shopping is available for everyone even if they don’t have a specialty retailer in their community. Amazon’s innovation insights also come from their low barrier of entry for brands who can release new products without having to launch a full campaign. It allows emerging brands to debut their products, and legacy brands to test the waters before committing to a new item. Data from these sources give you an omnichannel look at the shoppers and brands that take risks to stay a step ahead of the rest of the market.

Data from the Natural Channel and Amazon answer 3 essential questions for successful CPG product innovation:

1. Where is the innovation opportunity?

Whether you have an idea in mind or are trying to find whitespace, you want proof that there is demand for a new product and that it warrants the resources you’ll invest to create it. You might find that the market is filled with products identical (or nearly identical) to your proposed innovation, and you need to understand who the competition is and if there is any room on the shelf for you. Or it could be the opposite: a rapidly growing category might have only a few legacy brands that leave plenty of shoppers’ needs unmet and an opportunity for you to get in the game.

2. What are consumers telling you they want?

When you’re passionate about your business and wrapped up in a competitive mindset, you can forget that you don’t tell shoppers what they want—they tell you. They’re telling you every single time they make a purchase. That’s why teams in marketing and R&D come together to understand the motivations behind these purchases. Shoppers might be choosing a product because of tangible attributes like form (i.e., tablet vs gummy), organic, sustainability, and more. Or they might be drawn to attributes that describe the benefit of the items, such as immunity enhancers, energy boosters, or anti-inflammatories. It’s the chance to do a “gut check” on what you think customers want.

SPINS Omni-Intelligence brings together Product Intelligence and ClearCut Analytics so that you not only get that point-of-sale data, but also have a view of how product attributes affect sales at a more granular level. You can explore data via product attributes like ingredients, label claims, allergens, and form to discover consumer motivation and identify what’s driving emerging (and falling) trends.

3. What product should you launch (and why)?

Once you’ve answered the above questions, you can decide which product you want to take to market. This is when you establish your point of differentiation, decide which attributes belong in your product, and why this product is the optimal choice. When you can articulate this information, you not only know what product you should launch but you also have begun to form your sell story. Retailers will be asking the same questions about your product that you’re asking if they’re going to provide you shelf space. Answering this question turns your research into a reality.

SPINS Omni-Intelligence Puts a Spotlight on Innovation

No brand can afford to innovate purely for the sake of innovating. Innovation needs to meet a demand for consumers. Bringing a product from an idea to the shelf requires significant time, cost, and personnel. Before you begin that process, take a look at the market with an omnichannel perspective. SPINS Omni-Intelligence allows you to understand what is happening in Natural and Amazon channels—the two leaders in innovative products. Look at the attributes driving trends in these early adopter channels, and you’ll be better positioned to create a product that consumers are eager to buy, and retailers want to stock.