Food and beverage innovation plunges nearly 50% since 2007: Mintel

Innovation has declined the most in food and drink versus other industries since 2007, Mintel said in a report. The market research firm said 26% of new products between January and May 2024 were genuinely new products compared to 50% in 2007.

The market research firm said the percentage is the lowest it has recorded since it began tracking new products in 1996. Nearly two-thirds of launches this year are “renovation,” Mintel noted, or line extensions, reformulations, new packaging or relaunches of existing products.

The dearth of truly novel innovations could create long-term problems for the CPG sector. Mintel’s analysis showed that innovation “has been in short supply in recent years, and this innovation drought risks the future profitability, and potentially, even survival, of established CPG industry players.”

There is already evidence that the innovation slowdown is having an impact. Mintel noted that the lack of innovation — especially as big brands have pushed through price hikes in recent years — makes it easier for consumers to turn to private label options and may provide an opening for more nimble upstarts willing to take on risk and without the need to appease shareholders.

Jonny Forsyth, Mintel’s director of food and drink, said much of the innovation during the past 20 years has come in e-commerce. He noted, however, that food and drink manufacturers have to cope with complex supply chains, low margins and temperature control when delivering fresh food and drink. This creates greater barriers to entry for new businesses compared to startups in beauty and personal care or household goods.

Food Dive