NPD strong despite struggling economy

The struggling UK economy and the much talked about 'credit crunch' has had little impact on new product development activity, a survey carried out by Sun Brand Technologies has found.

In spite of the gloomy financial forecast, 58 per cent of brand managers are planning to launch the same number if not more products as in 2007 in a bid to keep consumers spending, putting paid to reports of marketing industry misery this year.

Gone are the days of relaxation during a recession.

85 per cent of those questioned felt there was constant pressure to introduce new brands, with retailers and consumers driving demand in equal measures.

However, this isn't surprising, with competition for shelf space riding at an all-time high.

Products now have significantly less time to prove their popularity than ever before, so innovation is crucial.

42 per cent of those questioned believed that the on-shelf trial period has shortened considerably in the past five years with the majority of products having just a few months to succeed.

Regardless of this, more than half of respondents believed that the high level of NPD was justified.

And, if past trends are anything to go by, this pressure is only likely to increase over the next five years.

As the retail powerhouse goes into overdrive, businesses will be challenged on a range of product issues from cost and speed-to-market to the environment and consumer demand - and only those with the resources to address these requirements are likely to succeed.

Some 80 per cent of respondents believe that cost will be the most important issue affecting NPD over the next five years.

Consumer demand was rated highly, with over two-thirds of brand managers considering the public a force to be reckoned with in the future of NPD.

The speed of getting a product to market and environmental issues were also predicted to be critical factors for successful launches in the future, by 60 per cent and 52 per cent of respondents respectively.

Martin Hawkins, Executive Director of Sun Brand Technologies, which markets the Odin brand management tool, commented: "If we were in any doubt as to the value of NPD, the survey results really put this into perspective.

"When you consider the fact that we are in the midst of a national credit crunch, it really is enlightening to see that NPD is still thriving and brand managers are actually looking to accelerate their development plans this year.

"However, if brand managers think the pressure is on now, I can only imagine it will get worse in the coming years.

"Companies really need to think about how they can strategically address issues such as cost, the environment, speed-to-market and consumer demand if they are to stay ahead of the competition and ultimately, in business.".

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