Beverage R&D: 2011 New Product Development Survey

The New Product Development survey found that 45 percent of respondents plan to launch more new products into the marketplace in 2011, while 44 percent plan to launch the same number. Driving new product introductions are consumer demands, changing tastes and the need to create excitement in a product line, according to survey-takers. Popular responses also included “health and wellness,” “profitability,” “all natural flavors/products” and “gaining market share.”

The majority of respondents to the New Product Development Survey focused on non-alcohol beverages. Fifty-seven percent identified water and juice products to be the focus of their new product development, and 52 percent will dedicate resources to new sports and energy drinks. In addition, 24 percent said they are working on new beer, wine and spirit products. This represents a decrease from 2010’s survey figure of 30 percent of those polled who indicated that they expected to create new alcohol beverages. Carbonated soft drinks were a focus for 23 percent of those polled, which is an increase from 2009’s 14 percent of respondents.

To keep up with the market, 60 percent of beverage-makers polled anticipate company research and development budgets will stay the same as budgets in 2010. Thirty percent forecasted an increase in research and development budgets for reasons that include “focus on higher quality products,” “increased pressure to meet customer needs in a changing market,” as well as increasing projects, staff and resources. The reasons were mainly economical for the 10 percent of respondents who indicated R&D investments will decrease, including lack of budget, costs and a weak economy. One respondent who anticipated a decrease in R&D budget for 2011 indicated its “focus is on expanding existing product line and not adding newly developed items.”

The average investment for new product development from concept to consumer was about $46,000 in 2010. A budget between $1,000 and $25,000 was indicated as the cost for 46 percent of survey-takers, while 42 percent said they spent in the range of $25,001 to $100,000 on development.