Innovation Triggers

material minds

The key to successfully marketing innovation

material minds 2

Understand how companies and people innovate

New product failure Rates

material minds 3

•  In the US 30,000 new products are created per year •  70-90% failure rate •  47% New mover failure rate

material minds 4

12% Success rate in venture capital backed companies

material minds 5

•  1500 get financing annually •  350 are sold •  But of those 350 only 26% get a greater than 4 times return •  50 go public •  That’s a 12% success rate

material minds 6

Innovation fails mostly due to the lack of a market. There is no market for a product if there are no triggers to innovation, if there are barriers to that innovation, or if you aren’t differentiated enough from the competition.

Your Success

is dependent on overcoming human’s natural tendency not to innovate.

material minds 7

There must be an External Force Pushing People to Innovate

material minds 8

All innovation is initiated because of an external force that causes people to want to change what they are doing for one of four reasons. These reasons are known as innovation triggers.

Regulatory triggers

material minds 9

Some triggers are created by regulation. When the government or a group of which you are a member creates a regulation, you must innovate to follow that regulation.

Strategic or societal triggers

material minds 10

Some triggers exist because of what your competition or society is doing. When the competition is winning in the marketplace you have to innovate to stay with them or beat them. Societal pressure also forces people to innovate personally.

Operational and technological triggers

material minds 11

When companies grow they need to change how they do things in order to support that growth. This is an operational trigger to innovation. Changes in the availability of technology also require companies and people to innovate in order to stay current.

Financial

material minds 12

Finally, if it still has time and capital available, companies will invest money to save money. This is the last thing they will do in order of priority because all other problems are more important. The external force here is the shareholder who wants a greater return.

What you see as a problem, they might not see as one

material minds 13

If you’re selling a product, everyone will ask you what problem you’re trying to solve. Well you might see a problem but if others don’t see it that way, you are not solving a recognized problem.

Someone must own the problem

material minds 14

So if people recognize there is a problem, is there someone in the company who owns the problem? There are lots of problems that companies have but the way they think or strategic priorities may mean that there is no one responsible for solving the problem. If there isn’t someone responsible for solving the problem then you have no one to sell to.

The problem owner must wake up everyday trying to solve that problem

material minds 15

Even with someone responsible for solving the problem, they may already have a good enough solution. It may not be as good as your solution but they may think it good enough for now. That’s why Excel is used in so many applications instead of databases. The person responsible must be waking up every day trying to solve the problem if you want to get anywhere.

They have to have a budget

material minds 16

I have come to believe that the most important thing to identify in creating a company is finding a customer with a budget. If a company doesn’t have a budget for what you want to sell and will take a long time getting a budget then you’ll have a slow start, whether or not you get VC financing.

Without an external trigger

material minds 17

People will not be looking to innovate so you will not connect with them. You will end up with a product in search of a market

Before you build a product, find out what their triggers are and how you can use their triggers to help you change their behavior

material minds 18

In addition to triggers

There are barriers to innovation and competitive forces you must overcome to succeed. But more of those issues in another slide deck.

material minds 19

material minds

We help technology entrepreneurs innovate, communicate and execute. We focus on helping improve business processes that require an in-depth understanding of human behavior for them to be effective. We provide Business Advisory Services, Workshops and speak at events. Charles Plant cplant (at) materialminds.com @cplant 416.458.4850

material minds 20