Mintel Report – In 2024, Global CPG Innovation Reaches an All-Time Low

Open Forum
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This report arrived in our CFIN inboxes this week and we wanted to share it with our larger network.
Key points:
  • Mintel's Global New Product Database (GNPD) shows that for the first five months of 2024, just 35% of global CPG launches (i.e. across food, drink, household, health, beauty, personal care and pet care) are genuinely new products. This is the lowest proportion of innovation Mintel has recorded since it began tracking new products in 1996. It means that so far in 2024, 65% of launches are 'renovation' i.e. line extensions, reformulations, new packaging or relaunches.

  • Bigger brands are innovating less --> Nielsen data revels that between 2016 and 2020, only 25% of the growth of CPG was driven by leading brands, with small and medium-sized brands capturing 45% of growth and private label securing 30%

  • When comparing different CPG industries, innovation has declined the most in food and drink, which launched just 26% of new products between January and May 2024 compared to 50% in 2007

  • Why is this the case? Similar reasons we hear from our members on a daily basis:
    • Food and drink manufacturers have to cope with complex supply chains, low margins and the need for temperature control when delivering fresh food and drink. The barriers to entry are therefore much greater than if you are starting a business in categories like beauty and personal care, household goods or vitamins and supplements.



If you're interested in digging more into this report, you can read the whole thing here --> https://www.mintel.com/insights/consumer-research/role-of-innovation-future-cpg-industry/?utm_source=crm&utm_medium=email&utm_campaign=ongoing-mn-wr-global-cpg-innovation&utm_content=20240716-mn-em-amer-cpg-innovation-launch-email1c&mkt_tok=MTkzLUpHRC00MzkAAAGUW8nC_GkSnYz3wxiyOEEzqZlcm5290rfN-1CyJWob8k0PblnHACDh-lEkz753x891zRZgpYbndkZqQfL_tNxpwGuL_WNwuVV7oY9DN12-Ya1a

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This report underlines a global problem that is highly relevant to Canada. I'd say that the regulatory complexities of managing a food brand is also at play here. I hear from both big and small branded companies that their R&D/Innovation budgets are almost completely consumed by making packaging and other changes that are required to comply with rules in different provinces as well as with new regulations such as carbon management requirements.

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Highlights the need for targeted support and innovation initiatives within each region.

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Also, in Food and Beverage its easier to start as barriers are not that high but extremely difficult to scale. A lot of innovation in that segment might happen at very small level that will not likely show up in Mintel reports. Supply chain, regulations and grocery landscape are all set up to service bigger brands who have scale. And, for Bigger Brands there is so much at stake, most have a gate process that kills a lot of smaller niche innovative ideas. There need to be initiatives that would bring systemic change to the landscape.