ABSTRACT
Food processors looking to create successful new products in the current retail and consumer environment have faced increasingly difficult challenges. Companies recognized that there is less risk and a potentially faster return from leveraging equity in core brands than in investing in innovative new food products. The Efficient Consumer Response (ECR) initiative of the 1990s, including a move toward category management, led to a reduction in me-too types of food product launches. The challenge for the retailer is to be able to separate those brands that add category value from those that do not and collaborate with manufacturers operating according to that discipline. New products represent one of the few growth avenues left to packaged goods companies pressured by Wall Street to increase profits. Product development is fundamental to the success of the organization. New product development is part of business unit strategy.
