‘Test, learn, and innovate…’ Parents’ snacking habits inspired latest innovation at OUTSHINE, says Nestlé USA innovation exec

Nestlé - which licenses the OUTSHINE brand to Froneri, a joint venture it created in 2016 with PAI Partners – surveyed Millennial and Gen X parents with kids aged one to 12 years about household snacking habits, and saw an opportunity to take OUTSHINE out of the freezer, Nestlé USA senior director of new business ventures Doug Munk told FoodNavigator-USA in an email interview.

“One out of three parents already consume kids’ pouches but may not feel comfortable doing so since most are made for children. Pouches targeting adults are a growing trend, but most on the market now aren’t​ [also] appealing to kids. ​

“To ensure the whole family feels comfortable enjoying OUTSHINE fruit & yogurt smoothies, the product’s taste and texture is designed for whole family appeal, and the packaging design is elevated and intended for a wide audience, so there are no elements that particularly appeal to one demographic such as cartoon characters.”​

‘Our work with OUTSHINE exists within our innovation incubator’​

OUTSHINE Smoothie Cubes, which transform into smoothies with the addition of milk, will follow later this year for the brand, which has seen elevated sales during the pandemic, he added.

“Our work with OUTSHINE exists within our innovation incubator​, [which] allows food entrepreneurs to create new and unique food products and make them more widely available to consumers. Ultimately, we aim to create solutions for consumers, and they’ll tell us what works. We’re always trying to think of ways to test, learn, and innovate.”​

While the pouches are made from mixed materials and not recyclable through most curbside collection schemes, Munk insisted that, “Sustainability is hugely important to us​,” and added: “Nestlé aims to make 100% of our packaging reusable or recyclable by 2025. To meet this goal, we’re currently investigating and testing recyclable packaging options.”​

Made with fruit blended with non-fat yogurt, Outshine Fruit & Yogurt Smoothies are available in four flavors: Blueberry Pear, Peach Raspberry, Strawberry Coconut, and Pear Vanilla. Each contains <10 g total sugar, 0g added sugar, no artificial flavors or colors, and “no GMO ingredients.” ​

Found in the applesauce section of retailers including Food Lion, select Kroger-owned stores including Kroger, King Soopers, Smith’s, QFC, Mariano’s, Roundy’s, Dillons, Fry’s, Fred Meyer, and Ralphs and select Safeway Albertsons in the Pacific Northwest (SRP $4.99 for four pouches), Outshine Fruit & Yogurt Smoothies are also available for purchase online through Amazon.

‘GoodBe and Goodnight are no longer on the market… but they became great learnings for us’​

While not everything emerging from Munk’s innovation incubator has translated into CPG gold -  goodbe refrigerated probiotic bars and goodnight functional chocolates did not set the world on fire – learnings from these launches helped the company go on to develop innovations it hopes will achieve greater success, he claimed.

“Both goodbe and goodnight are no longer on the market, but they became great learnings for us in the permissible indulgence and snacking space,” ​said Munk, who rejects the notion that big food companies are mostly buying in innovation, and serving as scale up platforms for smaller, more 'authentic' brands they didn’t create.

“Using those learnings, we launched Nestlé Rallies ​nut butter bombs​​​ [refrigerated nut butter bars], and these OUTSHINE smoothie pouches. ​

“We’ve seen great consumer reception to Nestlé Rallies, another example of meeting our consumer where they are with the products they want. Nestlé Rallies was developed to address the increased snacking need with the perfect balance of permissibility and indulgence, with less added sugar compared to the leading chocolate nut butter indulgence. ​

“We launched with two flavors, brownie almond butter and salted cashew butter, and are adding a third this year: raspberry peanut butter.”​

Combine the scale and expertise of a global company with the speed and agility of a startup ​

So what does the innovation strategy at Nestlé USA look like, and are the mechanisms in place to enable a more nimble, fail fast strategy?

According to Munk, the three-pronged strategy he outlined pre-pandemic (check out our 2019 interview at Expo West​​) remains in place: re-imagine core brands, cultivate an M&A pipeline (the company has invested in or acquired on-trend brands such as Orgain​​, Nuun, Essentia, Freshly​​, Vital Proteins, Chameleon Cold Brew, Blue Bottle, Sweet Earth, Nature’s Bounty, and Garden of Life), and develop new innovation models.

“COVID-19 changed the demand landscape for everyone, ​[but] our innovation strategy remained constant: combine the scale and expertise of a global company with the speed and agility of a startup to continually grow with and for our consumers.” ​

Crowdsourcing innovation: ‘Employees throughout the organization, regardless of job title or function, are encouraged to submit and vote on ideas’​

Nestlé USA also continues to tap into the expertise of its employees to identify new ideas and products as part of its open innovation work, he added.

“Most recently, Nestlé Toll House ready-to-bake brownies launched through our open channel innovation platform; this internal crowdsourcing initiative was introduced at Nestlé almost four years ago. Employees throughout the organization, regardless of job title or function, are encouraged to submit and vote on ideas. ​

“Those with the most popular ideas are invited to present to the leadership team and, if selected, are provided resources to commercialize the concept. Ready-to-Bake Brownies are just one of the several market successes. Others include Stouffer’s Classic Lasagna Bites and Stouffer’s Chicken Pot Pie Bites.”​

‘Most people no longer eat three meals per day’​

So what consumer trends is Munk tracking these days?

“One trend we’re tracking is what we call at Nestlé the at-home revolution,” ​he said. “As eating at home increased exponentially in the past few years, we’re focused on making sure that eating in home is as easy and delicious as it is out-of-home. While there has been some expected shift from pandemic activity, we continue to see consumers embracing these new habits…​

“We’re also tracking a blurring trend in mealtimes; most people no longer eat three meals per day. With increased work-from-home instances and more flexible schedules, many are snacking more and eating smaller meals.” ​

Nestlé USA has also moved to “quickly evolve our e-commerce strategy​​ to meet growing consumer needs,” ​he claimed. “Last year, e-commerce growth doubled for us globally, and here in the US, it accounted for 40% of our growth.”​

‘Alternative protein technologies that provide sustainable solutions’​

Finally, he said, “Plant-based is a huge trend that we think will continue to grow in the years to come. Our data show as many as 65% of Gen-Z Americans want to adopt a ‘plant-forward’ diet. Whether it’s our ready-to-eat Sweet Earth plant-based Mindful Chik’n or non-dairy Natural Bliss creamers, we’re focused on giving consumers the options they want. ​

“We’re also looking to what’s next by exploring other alternative protein technologies that provide sustainable solutions.”​      

*OUTSHINE commissioned Edelman Data x Intelligence to conduct a 10-minute quantitative online survey among 1,000 Gen-Z and Millennial parents in the US with children aged 1-12 years old in July 2021.