SA shoppers drawn by novelty of new
Country’s ‘early adopters’ help manufacturers gauge the appetite for their latest products across the world
CONSUMERS in South Africa have a distinctly “new world” view and love trying new products, according to the latest Nielsen Global Survey on new product innovation.
As many as 51 percent of respondents in South Africa said they purchased a new product during their last grocery shopping trip.
The study found that nine of the 11 markets with the highest percentage of early adopters (based on new product purchase sentiment) are developing countries. South Africa recorded 28 percent, compared with markets like Brazil (39 percent), Peru (30 percent) and Israel (30 percent).
Nielsen Africa marketing and communication director Ailsa Wingfield says: “Early adopters are an important segment for manufacturers. They serve as product testers, providing feedback and suggestions for improvement and they’re often opinion leaders, who can be powerful allies in spreading the word about new products.
“Developing countries like South Africa are therefore attractive markets for new product expansion efforts, due to their younger demographic composition, rising middleclass population and strong appetite for affordable luxuries.”
The youngest respondents were more likely to have purchased a new product during their last grocery shopping trip than their older counterparts, but those categorised as “early adopters” only show a slight age bias.
“Early adopters aren’t just younger consumers. Consumers of all ages are looking for products that make their lives better, and they can be passionate advocates if they find a product that fills a need,” Wingfield says.
“While Millennials are garner- ing a fair amount of recent time and attention, it would be useful to consider casting the net wider, and not lose sight of the needs across all age segments.”
When it comes to launching new products, South Africa is no different from the rest of the world – brand competition is intense and shelves are crowded. The harsh reality is that the vast majority of new product introductions are taken out of distribution before the end of their launch year.
Within this scenario, South African consumers deviate from the global norm when it comes to discovering new products, with the No 1 tool being “saw it in-store” (59 percent), followed by “watching a TV ad” (56 percent), which indicates there is still a reliance on more traditional methods. Word-of-mouth also has a role to play with 55 percent citing a reliance on friends and family to hear about new products.
“These findings show how critical the in-store environment is when launching a new product and the importance of in-store execution and strategic new locations for product distribution. There is a definite opportunity to build awareness as a means of stimulating demand, prior to consumers even getting to the store,” adds Wingfield.
Earned media sources are growing in importance for new product information gathering, but reliance on traditional sources is still strong. Millennials and Generation Z respondents say they use several tra- ditional advertising sources at comparable – or even greater – levels than older generations.
While the top list of sources combine a mix of paid, owned and ear ned media options, inter netrelated platforms are three of the top nine sources cited for new product discovery in South Africa, with active internet searches coming in at 47 percent and brand/manufacturer web at 18 percent. Reliance on social media showed the largest increase, rising 11 percentage points from 2012.
Social media usage for new product discovery is in fact particularly high in South Africa, with 31 percent of local respondents saying they utilise the medium for this purpose. This compared with Latin America at 31 percent, and 20 percent of European and 22 percent of North America respondents.
Looking at the new product attributes that resonate particularly strongly across all age groups, South Africa mirrors global trends, with affordability cited by 38 percent of local respondents followed by recommendation (34 percent).
“The fact that affordability remains key, shows that a value equation is imperative in South Africa for new product success, yet it is also the reason why most products fail,” says Nielsen South Africa’s innovation director, Lizette Kritzinger.
She says: ”The reality is that consumers need to stretch their money as far as possible, and they’re looking for products that stay within a budget.
“Savvy manufacturers are those who don’t just sell their products at lower prices or on promotion, rather they build cost-cutting into the product development and design process. Cost-driven innovation requires letting go of traditional assumptions, and it starts with understanding what trade-offs consumers will make when they can’t afford a product.”
Affordability remains key for South African
consumers
In ter ms of other factors spurring the purchase of new products, four significant themes emerged:
Brand Recognition
Of the reasons behind the purchase of new products, 26 percent said “It is from a brand that I like”, 19 percent said because it was from a well-known/popular brand, 14 percent because it was from a premium brand and 11 percent cited the fact that it was the best product in the category. Wingfield says it’s clear from the results that “if you have a strong, popular brand you are far more likely to succeed with a new product launch. A brand name can be one of the most valuable assets a company possesses.
“But brand building can be costly and time-consuming, so the ability to grow via line extensions can be extremely advantageous, with 10 percent of respondents saying their reason to buy a new product was: ‘It’s from a brand with heritage (we have known for a while)’.”
Novelty
Aspects like “it’s new” resonated strongly with South African respondents, with 24 percent indicating it as a reason to purchase a new product with the same percentage indicating “it’s better than similar products”. In addition, “I saw it every- where (in-store/advertising)” was cited by 15 percent.
Convenience/lifestyle
A number of questions related to the concept of convenience and the fulfilment of a direct need. These include 26 percent of respondents saying “it’s convenient” and “it makes life easier”. Steering more towards the lifestyle aspect, 21 percent said “it is suitable for the family”, while 13 percent said “it improves my mood”.
“New products can strike a huge chord with consumers by fulfilling more intangible needs like the emotional well-being of the family structure. This stems from the fact that time pressures and stress are facts of life. Shoppers want products that help restore balance and free up time to do the things they value most,” says Kritzinger.
Socially responsibility
Brands that are socially responsible and care about society also featured, with 10 percent of respondents saying “it’s from a brand that cares for the environment” and 7 percent “it’s a brand that cares about society” as a reason to buy. While South African respondents increasingly value new brands with a social conscience, they don’t believe there are enough products on the market that fulfil this.