“Don’t you ad people just convince us to buy stuff we don’t need?”
A criticism old as time. But let's remember that "buying stuff" is what keeps the country's lights on. So let's get smarter about what we make how we go to market.
Consumer spending is the engine of our economy, marketing is the gas, and I like working the pump.
Ted Bates, the Advertising Hall of Famer, proudly said “My job is to sell things.” Amen. It’s also a wonderful way to make a living, and critical to our economic well-being.
According to the latest CEIC Data, U.S. private consumption data hit an all-time high at the end of last year at 68.8% of our GDP (gross national product). When that percent drops, it usually means a recession is headed our way.
68.8% may be the high-water mark for a while…
The Conference Board closely tracks consumer confidence, and its latest picture isn’t pretty:
“Consumer confidence declined for a fifth consecutive month in April, falling to levels not seen since the onset of the COVID pandemic,” said Stephanie Guichard, Senior Economist, Global Indicators at The Conference Board. “The decline was largely driven by consumers’ expectations. The three expectation components—business conditions, employment prospects, and future income—all deteriorated sharply, reflecting pervasive pessimism about the future.”
Not a surprise given Trump’s whipsawing tariffs that have frozen business planning, fed inflation and uncertainty, and given consumers reasons to pause purchases.
Today’s temporary halt to the US/China tariff madness is…temporary
US businesses—especially domestic manufacturers—still can’t plan any permanent, structural changes with tariff threats still looming, and consumers will stay worried.
So what does all this mean for makers and marketers—especially when it comes to introducing new products into the marketplace?
It means when we talk “innovation,” we’d better mean it
What a lot of what marketers call innovation is anything but.
Much of it is shelf-stuffing, flavor-fluffing “innovation delusions” that no one really needs or wants.
It’s never been a smart strategy…but in this hesitant, hold-your-wallet environment, it’s downright stupid.
Honestly, do we really need 2,583,927 varieties of pasta sauce?
I’ve struggled with flavor and varietal proliferation with my food, beer and booze clients for 40 years. For example:
Did the world need the 48th flavor of my client’s Pinnacle Vodka brand 10 years ago? Definitely not. Today they “only” sell 30. C’mon—is that sustainable and productive?
How about today’s 31 varieties of Prego spaghetti sauce? Hard to believe that makes sense.
A little too saucy?
I took the above photo of the Prego and Ragu line-up at a Stop & Shop recently, and this was only about a third of the pasta sauce aisle.
I enjoyed working on the Ragu business with Donna Barker and Nivi Chakravorty when Unilever owned the brand. Today, Ragu sells 11 varieties to Prego’s 31, and my bet is the Ragu team is smarter, and the brand more efficient and profitable than Prego.
Another sign of Ragu’s smarts: instead of the upmpteenth sauce variety, they just announced a frozen pizza line in partnership with Palermo.
BINGO. This leverages Ragu’s sauce strength, extending the brand into another category, and importantly, into freezers both in store and at home.
Shelf-stuffing is “fake innovation”
Brands often cram new flavors onto the shelves to defend their shelf real estate, not to actually offer consumers something of incremental value or appeal. That’s usually a sign that they’re out of true brand-building ideas.
It’s a lazy sales and marketing tactic that trades off a potential sale today for a bloated and boring brand tomorrow. (If the Prego folks at Campbell can prove to me that Prego’s a more profitable and efficient brand than Ragu, I’m all ears.)
It also ducks important questions in brand management and marketing:
Are you just cannibalizing your other flavors? (Look at the shelf set photo again—do you think another Prego flavor will somehow pull people away from another brand for net sales and share gains?)
Do you really believe another flavor will increase your household penetration? (If you say you have research to prove it, maybe spend a few hours at your local supermarket watching shopper behavior on the sauce aisle.)
Who are your brand’s most valuable consumers, and what core and extended variants and flavors do they want that could actually help you retain, much less build, your business? And which flavors could your fans help you decide to drop?
How are you actively selling to and securing more people who are like your most loyal, valuable consumers?
What true, relevant innovation would change the game and add muscle to the brand instead of “flavor-fat?”
Where and how can your brand extend its equities and command new mind-space and store-space?
In short, Ragu Frozen Pizza may not be the new iPhone, but it’s the smart kind of food brand innovation. And with 1/3 the flavors of Prego, Ragu launches it off a stronger, more focused platform for long term growth.
Next week, I’ll share more product innovation and consumer demand perspectives.
I’ll continue this thread with perspective on Steve Jobs’ version of innovation, what China is learning the hard way about consumer demand, and how Herman Miller had the guts to let consumers—not designers—vote on new product launches.
Notes & Sources
https://www.nytimes.com/2025/05/12/business/china-us-tariffs.html
https://www.conference-board.org/topics/consumer-confidence/press/CCI-Apr-2025?utm_source=chatgpt.com
https://www.ceicdata.com/en/indicator/united-states/private-consumption--of-nominal-gdp?utm_source=chatgpt.com
https://foodsguy.com/ragu-vs-prego/?utm_source=chatgpt.com
https://www.foodbusinessnews.net/articles/28217-palermo-partners-on-new-ragu-frozen-pizzas
https://www.statista.com/statistics/189709/top-spaghetti-sauce-brands-in-the-united-states/
Love getting these Monday morning insights, Tom. They go well with my coffee and one of nine million brands of cereal I start my day with. :) Keep it coming.