Innovation Comes in Small Brand Packages
By Roy White
Innovation is a vital function in business and it is not easy
At large CPGs, it is very carefully programmed and backed by product
and market research. And it most definitely produces results.
But what about
the other end of the market — small and medium-sized businesses frequently
selling to a market of independent retailers? Innovation there has a much different
character: less programmed and more experience-based, with a different way
of looking at the market.
At the recent Fancy Food Show in New York, several
winners of the National Association for the Specialty Food Trade’s sofi
Awards provide some insight into innovation at small and medium-sized operations.
Royal Pacific Foods/The Ginger People, which produces beverages, baked goods,
candy and other products based on ginger, innovation is heavily oriented towards
healthy products developed by conducting field work, talking to retailers and "taking
chances on things." The team at The Ginger People visits
stores and talks to experienced chefs, and although they do budgets and forecasts,
intimate market knowledge obtained by going personally out into the field is
how most of the input for products is generated. As an example, with the economic
downturn, more people were cooking at home. This led to the thought that consumers
might want to get back to flavors and spruce up meals. The company’s "Pantry
Essentials" line was the result.
At Lazy Dog, innovation came by recognizing
the potential in a new distribution channel, specifically, gift and specialty
food for products that had been sold mainly through pet shops. The product,
Pup Pies (pie shaped dog food that looks like a birthday cake and is used to
celebrate a dog’s birthday), is all
natural and free of corn and wheat, but the sizzle is reaching the emotional
side of pet owners.
"In pet stores, we were part of the flood of products,
and even though we grew 28 percent last year," said the company’s owner, "we
thought going elsewhere would be a good idea."
Specialty food and gifts
were the answers, and led to the company attending the Fancy Food Show for
the first time.
Discussion Questions: Is it easier to achieve product innovation in large
or small companies? What factors are common in organizations known for innovation?