NEW PRODUCTS TOP ADS IN HELPING BRANDS GROW: IRI DATA PUT TRADE PROMOTIONS, PRICE CHANGES LAST

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Advertising doesn't boost package-goods brands as much as new products do.

That's one finding from "New Product Pacesetters '98," a study conducted by Information Resources Inc. and presented at last week's Food Marketing Institute show in Chicago. The study examined new products with a minimum of $7.5 million in 1997 sales via food, drug and mass merchandisers.

Of the 160 brands that showed at least 10% growth last year, 33% were totally new and 36% were line extensions. Advertising, packaging and promotions drove growth among 23% of the 160 brands.

Trade promotion and price changes were the smallest contributors to growth, both at 4%.

77,000 NEW PRODUCTS

IRI said that 77,000 new Universal Product Codes hit store shelves last year. Of all new products, 76% brought in sales of less than $10 million. Only 1% of all new lines introduced last year managed to reach the $50 million sales mark; $100 million is the common benchmark used for a new-product hit.

"On average, an innovative line extension delivers $30 million in sales in the first year while the conventional line extension delivers $25 million," said IRI Exec VP-Testing Services Jim Findlay.

Within the study, IRI identified the top 10 new products of the year, led by SmithKline Beecham's Nicoderm CQ smoking-cessation brand, with $243 million.

On the rise, Mr. Findley said, are beverages and breakfast "solutions" -- quick meal components -- while snacks and dinner solutions are trending downward. Lower-fat products are losing ground to high-flavor foods or new foods that feature novel textures.

CONVENIENCE FOODS HOT

On the floor at the FMI conference, convenience foods, indulgence foods and kids foods dominated the attention, although there were still a number of "better for you" lines being readied for retail introduction.

Campbell Soup Co. is coming out with Soup for One, a single-serve microwaveable bowl of soup, and a ready-made version of its tomato soup in glass jars.

Dean Foods is planning a national rollout this summer for a frozen meal kit called Voila! It will be the only one currently on the market to contain both vegetables and chicken, and has been testing since late February in 19 markets.

Dole Foods Co. is serving up pre-sliced, single-serve fruits under the Fruit Bowls banner.

Among other big launches, Kraft Foods is introducing Oreo O's cereal in August, with a $40 million budget for advertising from Ogilvy & Mather, New York.

Kraft also is adding Oscar Mayer All-Star hamburgers and All-Star hotdogs to its Lunchables lineup in July; a regional rollout will get ads from J. Walter Thompson USA, Chicago.

Ocean Spray Cranberries will back its new Wellfleet Farms juices (AA, May 4) with a $23 million campaign via Arnold Communications, Boston, and $22 million will be put behind Sara Lee Bakery's Cheesecake Bites and Cheesecake Singles, handled by Foote, Cone & Belding, Chicago.

OATMEAL DINO EGGS

FCB also is handling the estimated $8 million to $10 million marketing effort scheduled for August from Quaker Oats Co. for new Instant Oatmeal Dino Eggs, which reveal the eggs when hot water is poured on the cereal.

Among kids products being introduced are Keebler Co.'s Heads 'n Tails, under the Cheez-It brand it picked up with the purchase of Sunshine Biscuits. The new product will allow kids to match one kind of animal's head with its tail.

Ad support is expected late in the summer from Leo Burnett USA, Chicago.

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