Editor’s note: Jonathan Pirc is founder and vice president of product at Chicago-based marketing research firm Lab42.

We understand the importance of innovation in our industry but how important is it to the average consumer? How much do they actually care about innovation and how does that impact their shopping behavior? We set out to discover the consumer relationship with innovation and how important it is to the purchase decision. In April 2015, we launched a survey to gather insights regarding consumers’ perception of innovation. 

The results of the survey provide evidence of the benefits an organization receives when it is perceived as innovative.

Consumers care about innovation

A key takeaway for brands is that 84 percent of consumers say it is somewhat or very important that the company they purchase from is innovative. Innovation is seen as a vital aspect in the purchase decision, especially when it enhances the customer’s self-image. Fifty-one percent of respondents say they have bought a product without fully understanding what it did or how it worked because they felt or heard it was cool. Thirty-four percent agree that they like owning products that make them look innovative to others.

One surprising element in the area of innovation is the consumer understanding of the importance of research within the innovation process. Sixty-nine percent of respondents agree that research is needed to create innovative products.

Consumers like to be ahead of the game

Nearly two-thirds (62 percent) of respondents have purchased a first-generation product at least once. While consumers have a willingness to buy new products, they don’t necessarily want to be guinea pigs for the products. Only 21 percent of respondents report buying new products as soon as they come out compared to 63 percent who prefer to buy them once they have been out for a while.

The allure of innovation does wear off with age – only 6 percent of individuals over 55 buy first-generation products. But it’s not just youth that drives the desire for innovation.  Generation X is the most easily seduced, with 49 percent of 35-to-54-year-olds buying new products as soon as they come out, compared to 45 percent of Millennials.

Consumers will pay a premium for innovation

An important element for marketing teams is that the majority of consumers are willing to pay more for a product they consider innovative across the board. Perhaps unsurprisingly, 83 percent of respondents say they are willing to pay more for innovation in electronics, with 15 percent of these willing to pay more than 40 percent more (Figure 1). In the automotive industry, 75 percent of respondents say they are willing to pay an innovation premium and 10 percent are willing to pay over 40 percent more.

In addition to this, 67 percent of consumers will pay a premium for grocery store items which they consider to be innovative. And even in dull categories such as insurance and gas, the data shows an innovation-premium uplift, with 54 percent and 52 percent willing to pay more, respectively. 

Listen to the consumer

Another possible boost for market research and client-side insight teams is the importance consumers place on their feedback in the innovation process. Consumers were asked to rank drivers of innovation. We found that coming up with new ideas, listening to customers and continuing to improve current products are all at the top of the list. Innovation no longer sits in the area of forward-thinking technology. When asked specifically if a company can be innovative without technology 66 percent agree.

This survey clearly shows that coming up with new ideas for products and services is (not surprisingly) the most important driver. However in this digital age, consumers understand that innovation is driven by companies listening to people; understanding and responding to their needs; and continuing to improve current products.

How do you market innovations?

There has been a long debate in the marketing and advertising industry over the value of traditional television, with some more provocative figures declaring that TV advertising is dead. However, this survey indicates traditional television advertising still has an important role in promoting a new product. In comparing different types of advertising, promotions and sales channels, respondents said that television advertising was by far the best way to market innovations (52 percent), well ahead of 17 percent for store promotions and events and 13 percent for online ads. And we found the perception of innovation impacts the viewing of the advertising. When asked, “How likely are you to remember the advertising for a product or brand that you feel is innovative?” 45 percent said very likely and 47 percent said somewhat likely.

When it comes to messaging, just focusing on functionality isn’t enough. Messages that associate with emotions while also conveying the function of the new product are most successful for 56 percent of those surveyed, while those that feature just the functionality are most successful with only 33 percent.

The survey shows the importance of perceived innovation to consumers across all sectors. Innovation has become an important element in a consumer’s self-image, to such an extent that the functionality of a product can take a backseat to whether it is seen as a cool product or not. But innovation is no longer driven solely by technological advancement; it has become a more complex concept in the mind of the consumer.

About the methodology

The Lab42 Innovation Survey is based on 1,000 interviews conducted online between April 5, 2015 and April 9, 2015. The results were obtained using Lab42’s social media based sampling, where respondents are reached while they are engaging on social networks, games, applications or e-commerce Web sites. The demographics of the respondents are representative of the U.S. population based on age and gender.