Insights

New product development hits the sweet spot in developing markets
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New product development hits the sweet spot in developing markets

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Consumers in Southeast Asia show a strong affinity for brands which are investing in new product development and are among the most likely globally to trial new product offerings. Close to three quarters of Southeast Asian consumers (73%) say they purchased a new product during their last grocery-shopping trip – 16 percentage points higher than the global average of 57%. A further 73% like when manufacturers offer new product options (compared to 62% globally), while 56% are willing to pay a premium price for innovative new products (compared to 44% globally) and 50% claim that they are early purchasers of new product innovations (compared to 39% globally).

When it comes to obtaining information on new products, television advertising plays a key role – close to one in five consumers in Southeast Asia (19%) rank television as their number one source of new product information and 57% rank television advertising in their top five sources. Recommendations from family and friends along with the internet are also key influencers of new product trials, with 55% ranking family and friends in their top five sources of new product information and 42% ranking active internet searching in their top five sources.

“Consumers throughout Southeast Asia have a strong appetite for innovation and they’re increasingly demanding and expecting better choice,” observes Johan Vrancken, Head of Nielsen’s Innovation Practice in Southeast Asia, North Asia and Pacific. “But success can be hard to come by. Brand competition is intense and shelves are crowded so knowing the channels which are most effective in delivering new product information is crucial.”

Convenience is the key driver of new product trial for consumers in Southeast Asia, followed by greater affordability over current product used and family suitability. In comparison, affordability ranks as the number one driver of new product purchase globally, followed by personal recommendation and convenience. In terms of nascent product demand, consumers indicated products which centred on affordability, convenience, health and sustainability were a key focus.

“We know there is increasing awareness of and focus on health and sustainability across the region, and these latest findings certainly highlight that demand,” emphasises Vrancken. “As consumers become better educated on the importance of making healthy choices, they are increasingly seeking out products which support a healthy lifestyle and are made with fresh, natural ingredients. Similarly, as consumer consciousness increases around the importance of caring for the environment and developing sustainable products, demand for such products is increasing. These are invaluable insights to feed into the new product development process, which help ensure efforts are focused in the areas which will have the greatest resonance with the intended end user.”

This article is based on insights contained in the Nielsen Global New Product Innovation Report.