Whose need is it anyway?
Editor’s note: Barb Gasper is president and founder of Focus Research & Strategy Inc., Golden, Colo.
Need a winning innovation to add to your resume? Your boss likely thinks you do. Sixty-six percent of 2,500 senior executives surveyed in 58 countries consider innovations to be one of their top three priorities, according to a Boston Consulting Group survey, reported by businessweek.com.
In the world of consumer products, successful innovations are only as good as the consumer insight that we as market researchers identify. Now, before we puff out our chests and lay claim to the company’s 5 percent increase in revenue due to innovations, realize that to launch a successful innovation there are many moving parts.
The first, and an important part, is to identify the consumer need or the problem to solve. This insight should be at the beginning of any consumer packaged-goods company’s (CPG) innovations process. But this does not always happen. Here are some tips on what to do and what not to do when innovating.
Meet a consumer need. Develop real solutions and deliver real benefits. Don’t add a wrinkle to a potato chip and call it new-and-improved. Today’s consumers are savvy and know better. And just because the CMO or the chief engineer likes the idea doesn’t mean you should do it. One Fortune 500 manufacturer launched a product because operations could cut costs out of the system by making use of waste materials. Did the world need this new gadget made from manufacturing by-products? No. The result? Negative ROI. In this case, the new product died in the trial cycle and profits were impacted due to costs to launch the product. Simply put, the new product was not an innovation - something new that offered a benefit to consumers. Instead, it met a corporate need, not a consumer need.
Don’t brainstorm too early. It’s fun, and you already have a good idea you think will work, but don’t jump into brainstorming without doing the homework first. Ask, “Do we have enough information, or should we do some exploratory research among users?” Know if the problem to solve is widespread or whether potential usage occasions are limited. You may uncover a compelling problem - one that all consumers want solved. However, also ask whether there is another solution available on the market. Another Fortune 500 company identified and quantified “container leaves rings on tables” as a top problem to solve among a wide variety of consumers. However, when consumers were asked which of the problems they wished a company would solve, “container leaves rings on tables” fell off the list of priorities. It seems coasters, napkins, tablecloths and hot pads all serve as means to avoid leaving rings on tables. Brainstorming on this problem prior to doing the quantitative assessment would have identified innovations that solve problems that already have solutions.
Innovations must fit brand and/or corporate strategy. Another pitfall is developing innovations that don’t fit the corporate or brand strategy. If a product’s core positioning centers around safety, the question to explore is, what safety issues among target consumers are not currently being met in the category? There might be a great new innovation that is more eco-friendly, tapping into the sustainability trend, but it might not fit the brand’s safety positioning. An appropriate fit with a brand is a key measure in developing effective and compelling innovations.
Get to the problem to solve. Researchers need to help product and innovation managers peel the onion on benefits and dig down to the real problems. As an example, a soft-drink manufacturer may say an innovation area is portability. True, soft drinks are often consumed on-the-go from a single-serving container. However, if you brainstorm on a broad topic like portability, you will find ideation more difficult. The best ideation sessions start with a clear problem to solve. Sticking with portability, what is the consumer problem? Where does it happen? How often are the usage occasions? Is there an existing solution to the problem? You may find that what really bothers consumers is that when the can is empty, they toss it on the floor of the car and it leaks on the carpet. Unless you identify a specific and compelling problem to solve, ideating on broad areas like portability will likely not lead you to a solution that consumers will buy.
Manage risk; avoid the tallest pygmy. Managing risk is job one for research managers. Companies that do not innovate well incur great risk. Just because you can make something new and innovative doesn’t mean you should. Develop a risk-management research process, keeping the consumer central to your plan. First, mine current information, identify gaps and execute research to identify the consumer insight. Second, build the idea and identify features and benefits that matter most to consumers. Third, develop a rigorous innovation screening test plan and get buy-in from key decision makers. Agree upon stages in the process where the budget required for further innovation development warrants an evaluation. Develop benchmarks and compare your innovation results to other industry scores. Set go/no-go gates in the process and stick to the plan, which is easier said than done when a development manager has a pet idea. That said, remember, it’s more costly to launch an innovation that is the tallest pygmy - the best of the worst ideas - than it is to throw the idea out early in the developmental stage.
Diversify. The best ideas often originate from people who are not as close to the business as we marketers are. Bring in consumers, retailers, research and development, operations, and outside experts as well as marketers to brainstorm ideas. Get the research and development troops out of the corporate office during the exploratory phase of research. If your challenge is to innovate in the lawn-mower category, get the team riding mowers with parks and golf groundskeepers. Let them listen as home lawn-mower retailers explain what consumers are looking for in a new mower.
Know your research/innovations partner. There are dozens of new and effective methods being developed in the area of exploratory research. Options like mind-mapping, ethnographic observation, deprivation studies, think-tanks, blog-mining and trend-watching may deliver insights for ideation, or they may not. When you partner with an innovations research firm, ask what works for your test objectives. What is their process, and do they have a proven track record? Don’t go with partners who get creative and clever, using you as an experiment. Experience and proven results go a long way.
Manage internal politics. While senior executives will say they support innovation, do they? Is there an innovations and research budget? Is there a management team and culture that is favorable toward innovations? Is there a champion for innovation at the senior level, or even better, a chief innovations officer? Before brand and research managers launch into brainstorming areas for innovations, explore the corporate culture for taking on risk. According to “Management: How to Improve the Bottom Line Through Innovation” an article published in Executive Management in December 2008, companies that focus on improving - not just their innovation but also their innovation management - tend to be better overall performers than those firms that simply see the success or failure of an innovation as something best left to chance. The article cites a report from the management consulting firm Arthur D. Little as its source. According to the article, “The reason why some firms are more successful at harnessing the power of innovation is simple - it all comes back to management.”
Many forms
Merriam-Webster defines innovation as the introduction of something new. Innovations come in many forms. They can add value, solve a problem or be a new product or service. They can create greater efficiencies in operations, improve quality on the production line or reinvigorate an old, tired brand.
No matter how they are manifested, innovations, when properly formed and thoroughly vetted, can serve as a springboard for company growth. Keeping the above tips in mind will help your firm develop and bring to market the strongest and most viable new ideas.