The consumer sector is the main artery of the Philippine economy, but only a few people—or 2 percent—are likely to welcome new products in the market, according to a new consumer survey.
On top of that, only 25 percent of the 2 percent are willing to try the product again and potentially become a patron, the latest data from Kantar Worldpanel Philippines shows.
The survey, called “Innovnation: Then and Now” by Kantar Worldpanel, observed the performance and trend of more than 2,000 product launches in 58 fast moving consumer goods (FMCG) from 2012 to 2014.
The 58 FMCGs were classified into four categories: beverage, food, personal care, and household care.
This is the first Kantar Worldpanel innovation analysis in the Philippine consumer segment.
Alexandre Duterrage, Kantar Worldpanel general manager, said in a briefing on Wednesday “a new product is launched in the Philippines every two hours.”
This is slower compared to the “new product every minute” in China, which is considered as a global manufacturing powerhouse.
The survey showed that more innovations were being made in food and personal care, particularly cosmetics.
There are three types of innovation, Duterrage said. One is the entirely “new brand” which accounts for 24 percent of the total product launches in 2012 to 2014.
Second is the “new line extension” or the new variant of an existing product which accounts for 31 percent of total innovations.
Third is the “replacement or non-replacement” that upgrades an existing product in terms of weight, pack, and promos. This accounts for 45 percent of product launches in the country.
The secret to success in the Philippine consumer sector is continuous launching of new products – preferably entirely new products – which can set the tone of the local consumer market in the next few years along with the fast changing tastes of the consumers, Duterrage said.
“The players that are making difference today are in the top list tomorrow,” he said.
“(For) the local giants, it’s now the right time to expand locally and internationally. Don’t wait for markets to mature… In five to 10 years, it will be difficult to enter a new market,” he added.
Asked how local players fare against their foreign counterparts in the Philippine market, Duterrage said the consumer sector is mostly dominated by foreign labels.
Duterrage identified four core recommendations for players launching their products: recognize the embedded culture in your market; take your cue from global brands; be agile, be fast; and be online all the time.
Established 60 years ago, Kantar Worldpanel Philippines engages in analytics that keeps tabs on consumer behavior.