Precision Targeting: CPGs Must Engage Elite 1 Percent to Launch New Products

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They must locate and promote to the one out of every 143 consumers who make or break their new products.

Consumer packaged goods marketers have long been aware they play a high-stakes game. Growth for them depends on successful new products and line extensions, but the failure rate for new listings has long hovered at around 80%. Now a study released by Catalina offers them a cure for their age-old problem, difficult as it may be: Target the 0.7% of shoppers who account for 80% of the volume for a new food or beverage product.

That's right, in every grouping of 143 consumers, just one of them determines the fortunes of a new breakfast cereal, soft drink, or frozen dinner, according to the Checkout Coupons company's analysis of more than 260 million consistent shoppers at 30,000 drug, mass, and grocery stores.

“The percentage of households that make or break the success of new CPG products is very small, says Catalina SVP of Strategy Marla Thompson. “Our study shows that purchase-based targeting can be a cornerstone of successful new product launches.”

Of the 50 new food and beverage products analyzed, just eight showed shopper concentrations of more than 1% driving 80% of volume. Only one had a concentration surpassing 2%. The study also uncovered extremely low retention rates for new products, with just 11% of triers still engaged with a new item one year later.

Catalina defined a consistent shopper as one who shops at least two times every eight weeks for seven consecutive eight-week periods.

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