Everyone talks about innovation, but what does it really mean? Is innovation a product, a service or a technology? It can be all of these, but it's also something more. To be called an innovation your "product" must be adopted by the market and customer as an improvement in the way people live, work or play. Innovation doesn't occur until the market decides your product is what they have been looking for and they buy it.
Too often, companies look at innovation as something they accomplish inside their organizations. So let's be clear: Discovery, invention and product development occur inside the entity. Innovation occurs when the entity connects with the customer and commercialization of the product.
|Apple's innovative iPad has changed the way we enjoy downloadable content.|
If we look for examples of innovation, we can see the Apple's (AAPL - Get Report) iPad, iPhone and iPod have changed the way we enjoy downloadable content. We can look back several decades and see how the introduction of the PC by Microsoft (MSFT - Get Report) changed our view of computers. We can look at the GPS by Garmin (GRMN - Get Report), TomTom and others; social media (such as Facebook and Twitter); and Internet search engines such as Google (GOOG - Get Report) and see that when ideas become products the market embraces, mainstream innovation takes place. Without the connection to the market, innovation does not occur. An idea, invention or technology left on the shelf by the customer is not an innovation, it's a dust collector.Customer needs -- known and unknown -- are the determinants of whether innovation is even possible. A decade ago, if you had talked about the impact of social media you would have been looked at as though you were crazy. The thought that people would want to share the photos, thoughts and everyday moments of life with the entire world? Unthinkable. Innovation often occurs where we least expect it. Furthermore, it may occur where few could identify the opportunity. Companies such as eBay (EBAY - Get Report), Amazon (AMZN - Get Report), Google and Apple are prime examples of organizations that have the vision to identify a future need (one even the market doesn't know it has) and invent products, services and technologies that capture the consumer's attention and money. So from where you're sitting today, with your idea, invention or product and your desire to be the next big thing, the critical question is: "Does the market have a need -- recognized or unrecognized -- that will entice them to buy my product?" This is not a question that can be answered by "gut feeling"; you need to look objectively at your customers, at the market (for instance, at gaps, competitors and alternatives) and look at what you have to offer. You must be able to answer, without blinders, these questions:
- What is the value of this product to the customer?
- How will it affect their lives?
- Is the value they will place on it equal to or greater than the price I must charge?
- Why would they buy this product from me?
- How will I reach the customer?
- What is the most critical thing the customer will need to know to compel them to make the purchase?
- Am I being realistic in my assessment of the "pain" the customer is feeling now?
- How fast do I need to move to introduce the product?
- What will it cost me to take the product to the customer?
- Is this really something the market needs, even if they haven't recognized the need yet?
- If the need is unrecognized, how do I build awareness and desire in the customer and market?
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