An essential formula for success is for a brand or company to gain insights, knowledge and information about their consumer. A more focused understanding of the consumer and their desires and preferences will support product development efforts. Researching insights from actual customers should be a key part of the process. Often by letting consumers participate in the innovation process, you are creating a community of consumers that are active in your co-creation efforts.
Failure should also not be considered a shortcoming. In fact, failures are an effective learning opportunity. This also aids speed to market initiatives. In the process of innovation, by quickly identifying what ideas are worth pursuing, and what ideas should be discarded, you can rapidly prototype and test the more ideal solutions. Capturing key consumer insights at the start of the process can lead to better chances of success with the innovation.
A Broader Perspective
Innovation isn’t just about developing new products or technologies. It’s about creating value for the consumer. In an article on this subject in the MIT Sloan Management Review, “The 12 Essential Innovation Insights,” the authors discuss the danger of thinking too narrowly about an innovation. Often, companies innovate similarly to their competitors when it comes to research and development, systems and processes as well as branding. By thinking more broadly, and incorporating the consumer into your viewpoint, you can open yourself up to more innovation opportunities. The authors provide the example of Starbucks, which didn’t necessarily innovate with a different coffee product, but instead looked to enhance the customer’s coffee drinking experience.
In the MIT article, business innovation, the authors note, has to do with new value, not necessarily new things. The authors also presented an “innovation radar” so companies can consider 12 different areas in which they might innovate — ranging from method of value capture to operating processes to platforms. “When a company identifies and pursues neglected innovation dimensions, it can change the basis of competition and leave other firms at a distinct disadvantage,” the authors conclude.
The Start-Up Formula
All Things Innovation recently held a “Start-Up Partnership” roundtable discussion focused on partnerships between start-ups and corporations, and which can be seen through the lens of how insights can benefit such partnerships.
On one hand, the concept of corporations and start-ups partnering makes perfect sense. One side of the partnership is traditionally slower and more conservative based on the fact that tried and true processes have brought scale to a successful organization. The other side of the partnership is traditionally quicker and more progressive based on the fact that an unserved need has been identified and a small group of risk-takers has the skills to fill that need, but perhaps not the scale or processes necessary for success.
In the best case scenario, a partnership is formed and a corporation and start-up conceive of a completely new way of seamlessly doing business that delights current and new customers, leading to greater current market share and eventually introductions into new markets.
These start-up partnership dynamics often blend the faster/cheaper and bigger/better strategy within a structure that works for each entity. Ultimately, ensuring that each partnership is viewed as a unique collaboration while infusing each combined initiative with overall established insights can lead to a successful innovation launch.
Stepping Up with Insights
What steps can consumer insights take to benefit innovation at your company? We asked ChatGPT for a few pointers on the process. The answer seemed to indicate that an open environment of collaboration, encouragement and feedback, not to mention a lot of research and testing, is at least a starting point for developing better consumer insights to benefit innovation. It all circles back to the consumer.
- Identify the target audience: Identifying who you are marketing to is a key first step in understanding consumer insights and how they can benefit innovation. Understanding the demographics, interests, location, preferences, and opinions of your target market can provide valuable insight into what products or services may be successful.
- Conduct research: Researching your target audience helps to identify their needs and desires when it comes to new products or services. This could include surveys, focus groups, interviews or even online forums where consumers discuss topics related to your industry or product offering.
- Analyze data: Once you have collected relevant data from your research efforts, analyze it for trends that will help inform product development decisions. Look for patterns in customer behavior such as purchase frequency and amount spent over time as well as feedback about existing offerings that may indicate areas for improvement or potential new opportunities for growth.
- Test ideas: Testing out ideas with actual customers is a great way to validate assumptions before investing resources into developing them further and launching them publicly. Use tools such as A/B testing on websites or apps to gather user feedback on different versions of a product idea before committing too much time and money into building something that might not work well with users after all.
- Monitor performance metrics: After launching a new product/service, track customer feedback through reviews, ratings, analyze usage statistics (such as click-through rates) across channels (web vs. mobile), measure conversion rate optimization experiments etc. These insights will allow you to understand how successful an innovation was at meeting the needs of its intended customers while also providing direction around what should be improved next time around.
Understanding the Consumer
Innovation can start with the right customer insights. Insights can benefit innovation in various ways. They provide a greater understanding of the needs and wants of customers, which can help to inform product design decisions and create more innovative solutions to customer problems. Insights also provide valuable data that can be used to improve existing products or services, as well as identify new opportunities for growth and development. Finally, insights enable companies to gain an advantage over their competitors by allowing them to better anticipate market trends and capitalize on emerging technologies before the competition does.
