The recession dealt innovation a massive body blow. But now NPD is back – and it’s proud, says Liz Hamson

Necessity may be the mother of invention, but funding is undoubtedly the father one that's been largely absent as far as NPD is concerned over the past couple of years.

Line extensions, brand tweaks and pack revamps have been very much the order of the day, genuine innovation seemingly too risky or expensive to even contemplate. Or at least that was the case in 2009.

Tentative though the economic recovery is, there's a new optimism in the air in 2010, epitomised by the launch, a week on Monday, of Warburtons' ChippidyDooDaa and SnackaDoodle. The pitta and wholegrain snacks mark its first foray outside bread with refreshing flair safe brand extension this ain't.

And Warburtons isn't the only brand that's not sitting around waiting for the sun to shine to make hay. A whole host of big brands are poised to launch innovative new products this year. In a Food & Drink Expo survey, 56% of suppliers said they would invest in NPD, while 21% said they'd invest only in their existing range and just 12% that they'd invest nothing.

Innovation is back, it seems, not that many will admit it went away. The big players insist they've all been innovating through the recession to ensure they emerge strongly from it.

"If you look back at last year, in the midst of recession we were having probably our most prolific year of innovation in a long time," says Birds Eye marketing director Ben Pearman, citing the launches of Simply Bake to Perfection, Arctic Roll and Field Fresh.

But the likes of Birds Eye are the exception. Although plenty of brands can legitimately argue that they were innovating in the recession in the sense they were working on NPD that typically takes 18 months to two years to come to fruition, there were few genuinely innovative launches.

Most NPD fell into one of two camps, says Kate Waddell, practice director, consumer brands at Dragon Rouge "either limited-edition-style NPD to pique the interest of the jaded and spending-cautious consumer or much more expansive innovation in which we have seen clients lining up to create a strong, quickly actionable pipeline as soon as recovery starts".

It is the latter that's hitting shelves now. Warburtons is one of many either launching products that evolved during the recession, ramping up investment in 2010 or both. "For us, innovation is hugely important," explains new business director Jason Uttley. "In the past few weeks we've launched muffins and Tiger Bread. We've got two or three more products coming out over the next few months. We're upping our investment in NPD because it's what bakery consumers want. We are definitely doing more than two or three years ago."

Some are investing more than they had anticipated. At Diageo, Steve Hamilton, GB innovation director, says it is investing £3.5m more over the next six months than it forecast six months ago.

At P&G, meanwhile, its board chairman, president and CEO Bob McDonald, claims its innovation is the strongest he can remember in his 30-year career, an assertion backed by UK customer business general manager Geraldine Huse. "As the recession hit, we made a commitment to invest in innovation," she says. "We expect to have 30% more innovation through our core categories in 2010 to 2011. Consumers are looking for meaningful innovation that offers them great value."

That doesn't necessarily mean cheap, she stresses. "Everyone wants more value. For some people that's quality and a better experience, and some are more skewed towards a lower price."

Indeed, the paradox of the new products coming through is that, although they were developed in the recession, they don't have an overtly recessionory aesthetic. If 2009 was a story of value-driven NPD, 2010 is shaping up to be one of values-driven NPD.

Nielsen's NPD arm, Bases, describes the role of innovation this year as to encourage consumers to "unlearn" behaviours associated with price, saving, discount and value in favour of desires, wants, benefits, needs and premiumisation. "Grow value, create quality awareness, bet wisely and make your product count," is its advice.

"I don't think the recession is having an influence on the kind of work we're doing. What's driving it is environmental issues," adds Neil Hirst, director at packaging design consultants Seymourpowell.

And the products that will stand out, says Guy Douglass, MD of branding and packaging agency FLB, are those with values that are more than skin-deep. "NPD has to be totally relevant and offer something really different," he says. "In the past, you might have launched a brand with only emotional extrinsic values rather than intrinsic ones. Consumers need to see a real benefit."

Douglass questions the recent quality of innovation . "There's been little true NPD. What there's been has tended to be line extensions, NPD from a packaging point of view, but not true NPD."

Innovation stagnated last year, agrees Hirst. But, he says, the quality and quantity of NPD is picking up.

"Our clients are tiring of just doing a new shape," he says. "They're looking for more than that. It's the idea behind the shape that's important. We are involved with as much innovation now, probably more, than 18 months ago."

Ironically, the lack of funding may have helped in terms of the quality of NPD, adds Waddell. "Processes have become much more compressed, quick-turnaround and often leaner. We've seen early testing of more raw concepts before large amounts of development are undertaken."

Clients have also introduced clearer "commercial gates", closing innovation channels down as soon as a hurdle is not passed, she says. "The majority of NPD has been focused on answering very clear, heavily researched consumer insights. There is a lot more canny, commercially rigorous innovation."

That certainly seems to be the case at Diageo. It tested Smirnoff Blueberry in the on-trade and off-trade in Bristol for more than six months ahead of its launch this month and Smirnoff Mohitos and Cosmopolitans for a similar length of time in Ireland ahead of their rollouts, also this month. "With the recession, we're now a lot more in-depth," says Hamilton.

Pearman describes a similarly rigorous approach with Simply Bake to Perfection. "It's a premium product. I myself would have said when preparing for launch: is this really the right time when consumers are more value-conscious than ever? We managed to convince ourselves on the back of rigorous testing."

The results speak for themselves: the brand generated £16m sales last year following its April launch and is forecasting £25m-plus sales this year, despite its premium credentials. Kellogg's may not have had any joy with Nature's Pleasure, which was axed this week, but premium products that offer a genuine point of difference need not fear the harsh economic climate, argue Pearman and Huse. The former goes so far as to suggest the recession was nothing more than "a relatively light tail wind".

One that nevertheless focused the mind, says Bep Sandhu, trade relations manager at Mars. Some feel Mars has taken its foot off the gas, but Sandhu insists it has scaled back neither its R&D nor media spend. It has simply tried to see NPD in the round. "NPD doesn't just consist of new product launches. It's about making sure you've got something new and exciting. Renovation in any form can have an impact."

She cites Galaxy's new Cookie Crumble and large block Caramel variants as well as MaltEaster, which she says was "a really innovative product" and a "phenomenal success". Mars has also just announced the relaunch of Galaxy Counters, the "naked Minstrel" from the Revels packet, which shows there's life yet in the retro trend, says Sandhu.

Consumers played a part in bringing Counters back, so will we see more consumer-led NPD this year? Sandhu believes they have an important role to play but draws the line at getting them too involved. Some, however, think consumers will inevitably play a bigger role.

Giles Luckett, eCRM director at Soup Digital, highlights the role of email research in the imminent launch of a raisin-free variant of Jordans muesli. Social media will continue to shift the power base, adds Volker Bilgram, project manager at innovation company HYVE.

"Using consumers to help develop the product they want cannot fail," he says. "This technology is set to revolutionise NPD."

It is already doing so, says Hamilton. "We've been doing consumer testing at an early stage and it's an important part."

Huse is another fan, although she places it in a wider context. "We're getting much more immersive in our consumer research," she says. "We used to have a focus group and invite 10 people to a church hall. Now we work with consumers in the workplace, at home, on the internet."

In short, whether in a collaborative or an insight sense, consumers will be more integral to NPD in 2010 than ever before. "What we knew three years ago is not necessarily what we know now," says Martyn Withers, director of brand consultancy Embrace Brands. "I think more rigour will go into how we innovate. I also think there will be a lot of expectation. It's a new world. Our mindset as consumers has changed."

And with it, so has NPD.

The evolution begins
As Warburtons mulls the possibility of its first-ever bagged snack, a number of different routes to market are considered, each exploring a different theme. The We Bake tablecloth execution proves the least popular with Warburtons, but the "we bake" claim is a keeper.

The chosen one
ChippidyDooDaa, the pitta chip execution, pretty much hits the deck running. Only the "oven-baked" and "mature Cheddar" claims are changed - to "we bake" and "mature cheese". Pitta chips is also "dialled up"

Take one
The design for SnackaDoodle, the wholegrain snack, goes through more iterations. The bunny bites the dust on the grounds it's "far too cute" and suggests the snack is lighter than the pittas. A new "sister" for Chippidy is designed just don't call it a dog

Take two
SnackWackyWoo and SnackaRoo are among the suggested names, but neither feels right (the second's evocation of a kangaroo ruling it out). SnackaDoodleDoo, meanwhile, is too long

Take three
Having started out looking too similar to Chippidy, SnackaDoodle finally has its own identity and is deemed to pass "the white van man test" (Would white van man feel comfortable having these on his dash?)

The story so far
When Warburtons launches ChippidyDooDaa and SnackaDoodle a week on Monday, it will mark the culmination of a one-and-a-half-year journey, much of which has involved branding and design agency Anthem Worldwide.

One of the first tasks Anthem was set was to explore how prominent the Warburtons logo should be, so it mocked up packs showing a dominant logo, endorser logo and no logo. Endorser (present, but not dominant) won out in consumer testing, signalling to Uttley that people would be receptive to Warburtons snacks. It was time to start working up a design brief.

The rules were quickly established there were no rules. "Jason and I met one afternoon in Bristol and did a store safari, which gave us an idea of how far Jason would like to push the project," recalls Anthem account director Mark Walters.

In the parlance of designers he describes it as the Eureka moment. Blue-sky time. Pushing the boundaries to disrupt the fixture and turn the snack brand into the Tate Modern to Warburtons' core Tate Britain brand, Anthem presented its stage one creative briefing last May, kicking it off by showing the other brands in the fixture before exploring a number of possible routes to market.

The Chippidy execution, styled in the manner of a Saul Bass movie poster, was an instant hit, though Jonathan Warburton wanted to know whether the design could be pushed even further. It couldn't, though there was plenty of work still to do on the wholegrain design, share-bags and retail-ready packaging.

By late summer, the flat artwork shown here with its instructions for the repro agency was coming together. Fourteen weeks of thrashing out the copy and securing legal sign-off later and a new snack was born.