Running a successful beverage business isn’t about launching a single great product. No matter how fantastic your drink, consumers will eventually begin to look for something new from your brand. This is where a reformulation or product line extension may prove fruitful.

As you consider what’s next for your thriving beverage business, think about these 6 FAQs:

1. What’s the difference between a reformulation and a product line extension?

Understanding what makes a reformulation different from a product line extension is a great place to start. Most simply put,

  • A product line extension involves creating a new product—or SKU—by adding new versions or features—like a new flavor or sugar-free version.
  • A reformulation involves changing an element of an existing SKU rather than developing a completely new product.

Both projects are similar in that they start with an existing foundation or core concept to work from, which can make the development process more efficient than starting from scratch.

2. Why might I consider a reformulation or product line extension?

There are many reasons why a beverage company might consider extending a product line or reformulating an existing offer.

First off, consumers love variety. People get excited about a set of products and eventually want to see a new take—usually a new flavor. Even as your business grows, you’ll need to find ways to maintain traction in the market. Regularly introducing new products can keep current customers engaged while enticing new consumers to try your drinks, increasing opportunities for you to grow your revenue.

Other times, reformulation of an existing product may be the better route. There are many reasons why a brand might choose to reformulate, but typically when this happens it means something about the product isn’t working currently—but can be addressed. There are usually 3 primary reasons for this:

  • Consumers aren’t accepting a product as intended and the brand is getting a pattern of specific feedback—maybe the calories are too high, for example. This type of feedback can be addressed through a reformulation.
  • Brands also look to reformulation when they’ve decided to pursue a different consumer market requiring a parameter change. They might need to make their product comply with a certain beverage certification (like Organic or Non-GMO) or retailer’s specifications (think Whole Foods).
  • Finally, a reformulation can be considered when a product becomes too expensive to produce and an updated formulation is needed to lower a product’s per unit costs.

 

3. Wait—Doesn’t that mean a product line extension will involve a reformulation?

From a development perspective, a reformulation and a line extension are easily distinguishable. But while a product line extension almost always involves a reformulation, a reformulation won’t necessarily indicate a product line extension.

Let’s say you want to create a sugar-free version of an existing drink. To do this, you would still go the route of reformulating the existing “recipe” to exclude sugar. Now you can offer your product in the original and sugar-free forms—that’s your line extension.

Of course, you could also choose to simply update the original SKU by adopting the sugar-free formulation without extending the product line. You might have seen products labeled, “new recipe” or “now with 20% less sugar!” These are not line extensions, but simply reformulations of the same product.

4. What challenges may be involved in each process?

Depending on the complexity of the change, a reformulation or product line extension tends to be pretty straightforward. Of course, once you pull one thread, you have to unravel the whole thing and put it back together. Beverage developers use their expertise to address the unique challenges this process creates.

For example, something like removing sugar is easy, but then you still have to account for how that changes the formulation as a whole. Because sweetness carries a lot of flavor for a product, a solution will need to be found to replace that sweetener while still maintaining the integrity of the product’s flavor and formula as a whole.

This gets even trickier when you decide to pursue too many changes in an existing formulation, especially if there are already a lot of components involved, or if you’re dealing with more complicated ingredients.

Introducing CBD to your jam-packed energy drink brand might be a great idea, but the ingredient comes with its own formulation and flavor challenges. Taking into account the drink’s existing components, you may end up needing to adjust a number of variables in the formulation to ensure the flavor and quality of the drink overall.

5. How does each process work?

Great question—though the answer might surprise you… Both processes are actually remarkably similar to that of any other beverage development project.

You’ll still need to make some decisions about what you envision for your reformulation or product line extension before getting started. As with any project, Flavorman will use this vision and its specifications to map out the requirements for your beverage, but with the advantage of being able to reference and build from the original concept and formulation.

If you’ve worked with us before, then we’ll have the advantage of collaborating from an existing relationship. Both parties will have the advantage of already knowing what to expect, which can make the project more efficient. And even if you’ve never worked with Flavorman before, then no worries—our process is simple:

Through a series of sampling and tastings, Flavorman will move quickly through the development process. Your first set of samples will be promptly shipped to you so you can provide feedback to your team. We’ll repeat this process until we get it right.

Once you tell us we’ve perfected your unique formula and flavors, our team will get everything finalized and ready for production. We’ll scale up your formula and create your blending instructions, complete label reviews, and submit regulatory paperwork. In the meantime, we’ll also conduct quality and shelf-life testing to ensure your product consistently delivers a great experience to every customer.

6. When should I pull the trigger on a reformulation or product line extension?

As your business grows and more consumers have the chance to try your product, you should expect to get the occasional bit of negative feedback—that doesn’t mean you need to rush to reformulate! You shouldn’t consider reformulating in response to consumer feedback unless a specific pattern or high volume of negative feedback is discovered.

That being said, there are other reasons why you might want to reformulate—like rising per unit costs or an interest in reaching a new market. These reasons may justify a reformulation, but it’s up to you when it should be seriously pursued.

As far as a product line extension goes, we usually recommend entering the market with two or three varieties of a product—usually flavors—before pursuing additional ideas. You don’t want to put all 12 flavors of a product out there at once! Not only will you shock consumers with too much variety too soon, but you may run into challenges with distribution.

Most distributors and retailers taking on a new brand won’t agree to put more than one (or a few of your products, if you’re lucky) on the shelf until you’ve proven sales. Once you begin to outsell your competitors, you’ll be able to command more shelf space through product line extensions—and often, your distributors or consumers themselves will be the first ones to start asking for it: “We wish you had this in a black cherry flavor! Can you make that happen?”

One more thing to keep in mind—while Flavorman does have a reputation for being the fastest in the industry when it comes to speed to market, it can still take some time before you are ready to launch a product. If you’re interested in exploring the idea of a reformulation or product line extension, it might be a good idea to discuss the idea with your beverage development partner so you can understand the timeline you might be working with.

Whatever the dream, Flavorman can help you bring it to life.

With nearly 30 years of beverage development expertise, Flavorman has created—and reformulated—almost every kind of beverage imaginable. We’re confident that by partnering with us, you’ll have the best chance at success.

When you’re ready to change what the world is drinking, give us a call at (502) 273-5214 or get started with this web form.

 

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Written on March 31, 2021.