innovation: shaping the futureamai.org/congreso/2007/memorias/ponencias/davidnichols.pdf ·...
TRANSCRIPT
Innovation:Shaping the future
David NicholsManaging Partner, The Brandgym
Introducing myselfRole: Managing PartnerExperience: Aerospace Engineering, 1st Class Hons – Bristol
OC&C Strategy Consultants (‘92)
Added Value Marketing Consultancy (’94 – ‘05)
Expertise: Brand Vision, Brand-led Innovation
Books:
Hobbies: Qualified aerobatic pilot
Written & produced 3 musicals off West End
Sings swing in hotel bars
Some of my clients…
Innovation: Shaping the Future
• Innovation – current theory & practice
• Why innovation is not delivering
• A little experiment…
• Rocketing – a new process for innovation
• Six innovation success factors
Innovation is it
“The engine of real economic growth is not technology but innovation”Hector Ruiz, CEO, Advanced Micro Devices
“The only source of profit, the only reason to invest in companies in the future is their ability to innovate and their ability to differentiate”Jeffrey Immett, CEO of GE
“The only way to predict the future is to shape it”Eric Hoffer, American Writer (Later retold by Xerox CEO)
Innovation isn’t delivering…
1 in 2 innovations fail
…or is that 8 out of 10
…or maybe 90%
Not a pretty picture
…despite increased focus & resources
Current Innovation approach:
The Theory:
The Practice:
Meeting unmet needs
Innovation Funnels• Stage-Gate systems
The Theory: Meeting Unmet Needs
Consumer research =
unmet needs
Consumer research =
unmet needs
Design products to meet needs
Design products to meet needs
LaunchLaunch
Feedback
Yes!
Only in fairytales
The Theory: Meeting Unmet Needs
• Needs are hyper-satisfied Intense competition
“Insanely great”• Delivering against needs is not enough
Constant change+
‘Mass niche’• Consumers can’t tell you
anymore
The Practice: Innovation Funnel
Ideas Feasibility Capability Launch
Raw Ideas Winner
‘Stage-gates’ to kill off poorly performing ideas
The Idea Killing Machine
Why do funnels stifle innovation?
1. Focus on picking winners, not creating winners
2. ‘Gate’ admin is at the heart, not ideas
3. Makes it longer & more expensive
4. Assumes good ideas are easy to come by
5. Promotes ‘not invented here’syndrome
6. Senior expertise focused on evaluation not improvement
Why do funnels stifle innovation?
1. Focus on picking winners, not creating winners
2. ‘Gate’ admin is at the heart, not ideas
3. Makes it longer & more expensive
4. Assumes good ideas are easy to come by
5. Promotes ‘not invented here’syndrome
6. Senior expertise focused on evaluation not improvement
admin
Why do funnels stifle innovation?
1. Focus on picking winners, not creating winners
2. ‘Gate’ admin is at the heart, not ideas
3. Makes it longer & more expensive
4. Assumes good ideas are easy to come by
5. Promotes ‘not invented here’syndrome
6. Senior expertise focused on evaluation not improvement
Why do funnels stifle innovation?
1. Focus on picking winners, not creating winners
2. ‘Gate’ admin is at the heart, not ideas
3. Makes it longer & more expensive
4. Assumes good ideas are easy to come by
5. Promotes ‘not invented here’syndrome
6. Senior expertise focused on evaluation not improvement
Why do funnels stifle innovation?
1. Focus on picking winners, not creating winners
2. ‘Gate’ admin is at the heart, not ideas
3. Makes it longer & more expensive
4. Assumes good ideas are easy to come by
5. Promotes ‘not invented here’syndrome
6. Senior expertise focused on evaluation not improvement
Why do funnels stifle innovation?
1. Focus on picking winners, not creating winners
2. ‘Gate’ admin is at the heart, not ideas
3. Makes it longer & more expensive
4. Assumes good ideas are easy to come by
5. Promotes ‘not invented here’syndrome
6. Senior expertise focused on evaluation not improvement
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
More than 75% 75-50% 50-25% None
How many innovation projects fail?
Wow!
Marketing Directors see the problem…
Proportion of innovation projects that fail
% of Marketing Directors agreeing
Source: Brandgym research among marketing directors
…but research can be part of the problem
Like a drunk with a lamppost…
Research gets used for support, instead of illumination
So what is the solution?
Rocketing
A new process to get more bangfrom your innovation buck
A little experiment!
Rocketing Principles
Destination
Start with a clear vision
Combustion
Generate lots of high quality ideas
Nozzle
Quickly get down to the best ideas
Expander
Build best ideas into winning mixes
The detail is in my new book…
Six innovation success factors
1. Set a clear destination
2. Break the rules, not the brand
3. Get potent insight fuel
4. Bring ideas to life
5. Set ‘drop dead’-lines
6. Fail fast, fail cheap
Six innovation success factors
1. Set a clear destination
2. Break the rules, not the brand
3. Get potent insight fuel
4. Bring ideas to life
5. Set ‘drop dead’-lines
6. Fail fast, fail cheap
Set a clear BRAND destination
What is your product DNA?
What are you famous for?
What do you want to be
famous for?
NegotiableNegotiable Non-NegotiableNon-Negotiable
1. Set a clear destination
Quick exercise…
NegotiableNegotiable
Non-NegotiableNon-Negotiable
1. Set a clear destination
FastStylish2 seats
Sports car
2 seatsSports car
What about the Cayenne?
…hot extension or don’t mention?
1. Set a clear destination
Porsche results – cars sold
USA USA1 month ’07 ’05/’06
911 36% 35%Boxster 19%Cayman 13%Cayenne
Total 891 95,342
USA USA1 month ’07 ’05/’06
911 36% 35%Boxster 19%Cayman 13%Cayenne
Total 891 95,342
32% 36%
1. Set a clear destination
Bleedin’ Obvious Innovation Brief
Company: Parity Products Inc.
Brand: MeToo™
Context: MeToo™ is an exciting brand in the mid-quality, mid-price sector. Growth has been stable and consistent with the category in that it has been flat for two years. Premium brandsare demonstrating growth can be achieved through innovation, so we want to join in.
Brand Objective: Growth (in sales and volume)
Task: An innovation
Target: Consumers who shop the category
Competition: Other brands. And own label
Timing: Next year
Bleedin’ Obvious Innovation Brief
Company: Parity Products Inc.
Brand: MeToo™
Context: MeToo™ is an exciting brand in the mid-quality, mid-price sector. Growth has been stable and consistent with the category in that it has been flat for two years. Premium brandsare demonstrating growth can be achieved through innovation, so we want to join in.
Brand Objective: Growth (in sales and volume)
Task: An innovation
Target: Consumers who shop the category
Competition: Other brands. And own label
Timing: Next year
You need a killer brief, not a B.O.I.B.1. Set a clear destination
The Calippo innovation brief
Vision: Get teens to buy Calippo
Business source: Steal from soft drinks
Vision: Get teens to buy Calippo
Business source: Steal from soft drinks
1. Set a clear destination
?
Even impossible briefs can work…
Steal share from Coke
Make ice:- Drinkable- Reclosable
• Outsold ice cream x3• Steals directly from soft drinks• Rolled out round world
1. Set a clear destination
Six innovation success factors
1. Set a clear destination
2. Break the rules, not the brand
3. Get potent insight fuel
4. Bring ideas to life
5. Set ‘drop dead’-lines
6. Fail fast, fail cheap
Admit it.
Base: Sufferers from Constipation (past 12 months)
STSTSTSTSTSTST
222513272520217149100
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181919382542352559100
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unit: %
152101031612Gastritis
6921241217Vomiting
13914187722Bloating
128313101332Nausea
101382282629Abdominal cramping and pain
9141522172840Heartburn
34651181539Flatulence/gases
29293047496060Headaches
17881451718Constipation
South KoreaUKItalyFranceGer-
manyBrazilUSA
STSTSTSTSTSTST
222513272520217149100
24922432746332653100
1114332718221734100
181919382542352559100
10128322425403361100
102922242853504872100
242732525960656677100
9447338Haemorrhoids/Piles
unit: %
152101031612Gastritis
6921241217Vomiting
13914187722Bloating
128313101332Nausea
101382282629Abdominal cramping and pain
9141522172840Heartburn
34651181539Flatulence/gases
29293047496060Headaches
17881451718Constipation
South KoreaUKItalyFranceGer-
manyBrazilUSABase: Sufferers from Constipation (past 12 months)
STSTSTSTSTSTST
222513272520217149100
24922432746332653100
1114332718221734100
181919382542352559100
10128322425403361100
102922242853504872100
242732525960656677100
9447338Haemorrhoids/Piles
unit: %
152101031612Gastritis
6921241217Vomiting
13914187722Bloating
128313101332Nausea
101382282629Abdominal cramping and pain
9141522172840Heartburn
34651181539Flatulence/gases
29293047496060Headaches
17881451718Constipation
South KoreaUKItalyFranceGer-
manyBrazilUSA
STSTSTSTSTSTST
222513272520217149100
24922432746332653100
1114332718221734100
181919382542352559100
10128322425403361100
102922242853504872100
242732525960656677100
9447338Haemorrhoids/Piles
unit: %
152101031612Gastritis
6921241217Vomiting
13914187722Bloating
128313101332Nausea
101382282629Abdominal cramping and pain
9141522172840Heartburn
34651181539Flatulence/gases
29293047496060Headaches
17881451718Constipation
South KoreaUKItalyFranceGer-
manyBrazilUSA
Segmentation is dull.
Existing market spaceUnclear offer
Segment for tomorrow, not today
Good productQuick death
Good product
Clear & unique brand-led offer
Better survival
New segment
2. Break the rules
Segmentation: Break the category rules
Moisturiser = self tan
2. Break the rules
Banking = politicsDesign > Function
Six innovation success factors
1. Set a clear destination
2. Break the rules, not the brand
3. Get potent insight fuel
4. Bring ideas to life
5. Set ‘drop dead’-lines
6. Fail fast, fail cheap
Turn data into fuel
Breakfast
Mid-morning
Lunchbox
AfternoonSportsEveningKids
TeensYoung womenYoung Men
35-55
55+
3. Get potent insight fuel
Data Fuel
Use different sources of insight• Research amongst
core target
• Focus groups, quant studies
• Leverage existing knowledge
Real innovation or cannibalisation?
• Research among fringe groups, new targets…
• Observation, semiotics, talking to experts…
• Leverage knowledge from outside your part of the business
New ground
3. Get potent insight fuel
Use different sources of insight3. Get potent insight fuel
Prostitutes
Where did Kotex go to get their important new insight into menstruation?
360° Insight Checklist
360° Insight Sources
Competences
Retail Visits
Emerging Passions
Observation
Fringe Consumers
Semiotics
Competitive Landscaping
Experts
Trends
R&D Treasure Hunt
Global Category Trawl
Copy & Roll Out
Qualitative Research
Quantitative Research
3. Get potent insight fuel
…push yourself to find FUEL
Six innovation success factors
1. Set a clear destination
2. Break the rules, not the brand
3. Get potent insight fuel
4. Bring ideas to life
5. Set ‘drop dead’-lines
6. Fail fast, fail cheap
Initial ideaWeek 1
Mix early
Concept sketchWeek 2
Pack & AdceptWeek 4
• Real reactions• Sparks improvements• Raises hidden issues
4. Bring ideas to life
Don’t explore just concepts…
Brand X
Now a unique new blah blah blah blah blah blah blah blah blah blah
blah blah blah blah blah blah
Yada yada yada
Brand X
Now a unique new blah blah blah blah blah blah blah blah blah blah
blah blah blah blah blah blah
Yada yada yada
Brand X
Now a unique new blah blah blah blah blah blah blah blah blah blah blah. With subtly different blah.
Yada yada yada
Brand X
Now a unique new blah blah blah blah blah blah blah blah blah blah blah. With subtly different blah.
Yada yada yada
4. Bring ideas to life
Explore mixes…4. Bring ideas to life
Be distinctive in ALL parts of the mix
PACK• Stand-out• In-use benefits• Cue product story
PROMISE• Benefit claim • With support
PRODUCT• Visibly different to cue benefit• In-use difference
BeDistinct
SECONDARY PACK• Stand-out• Transport & storage
benefits
PLACE• Secondary sites in-store• New channels• ‘Get noticed’ distribution
PROMOTION• Use different media• Use old media differently
PIMPING• Be seen in the
right hands, in the right places
4. Bring ideas to life
Be distinctive in ALL parts of the mix
BeDistinct
PACK• Stand-out• In-use benefits• Cue product story
4. Bring ideas to life
Be distinctive in ALL parts of the mix
BeDistinct
SECONDARY PACK• Stand-out• Transport & storage
benefits
4. Bring ideas to life
Be distinctive in ALL parts of the mix
BeDistinct
PRODUCT• Visibly different to cue benefit• In-use difference
4. Bring ideas to life
Be distinctive in ALL parts of the mix
BeDistinct
PLACE• Secondary sites in-store• New channels• ‘Get noticed’ distribution
4. Bring ideas to life
Be distinctive in ALL parts of the mix
BeDistinct
PROMISE• Benefit claim • With support
4. Bring ideas to life
Be distinctive in ALL parts of the mix
BeDistinct
PROMOTION• Use different media• Use old media differently
4. Bring ideas to life
Be distinctive in ALL parts of the mix
BeDistinct
PIMPING• Be seen in the right
hands, in the right places
4. Bring ideas to life
Six innovation success factors
1. Set a clear destination
2. Break the rules, not the brand
3. Get potent insight fuel
4. Bring ideas to life
5. Set ‘drop dead’-lines
6. Fail fast, fail cheap
Set ‘drop dead’-lines
Apple’s secret weapon:
Macworld ExpoSteve Jobs publicly commits to new product launches
5. Set drop-dead lines
Set ‘drop dead’-lines
Q1 2009(or later if there is any hold up in the
process) Mars promises to re-invent chocolate on 1st July
Today: Tomorrow:
5. Set drop-dead lines
Dragon’s Den = innovation review5. Set drop-dead lines
• Don’t just stand there…perform!
• Really bring your idea to life
• Simple robust business case
Implications for research
Faster turnarounds(days, not weeks)
Six innovation success factors
1. Set a clear destination
2. Break the rules, not the brand
3. Get potent insight fuel
4. Bring ideas to life
5. Set ‘drop dead’-lines
6. Fail fast, fail cheap
Q: How does an animal do a test market?6. Fail fast, fail cheap
A: He does it for real
Firesticks was the clear winner, rest failed
• The others de-listed within 6 months
• TV advertising was put behind Firesticks only
6. Fail fast, fail cheap
Saved 12 months and $2m
Do more creation than evaluation
Time spent during
innovation:
Creation:
Evaluation:
20%
80%
“Moins de tests, plus de testicules”French Creative Director
Up to 30 evaluation ‘gates’ for each innovation project
6. Fail fast, fail cheap
Implications for research
Build more realityinto your testing
methods
Design cheapertesting methods
6. Fail fast, fail cheap
Six innovation success factors
1. Set a clear destination
2. Break the rules, not the brand
3. Get potent insight fuel
4. Bring ideas to life
5. Set ‘drop dead’-lines
6. Fail fast, fail cheap
Thankyou.
Innovation is, in fact,Rocket science…