What can you learn about growth and innovation from top brands?
A dying economy and global competition have made growth an impossible mission for many organizations. Yet, some companies (Starbucks, Amazon, Apple) seem to defy the laws of doing business during a pandemic.
In the year of the lockdown, e-commerce has changed more than ever. Retail stores have to establish their reputation in the online market and provide their public with unique benefits. With brands like Alibaba and Amazon monopolizing the market, small stores need to come up with innovative strategies to draw the public’s attention.
But is it worth investing in creating an innovation strategy when 2020 has cut down your income? With an estimated market value of $4.8 trillion by 2021, you’re already late if you haven’t created an innovation tactic until now. E-commerce has a lot to offer globally, and you can take advantage of these benefits if you plan and execute your strategy flawlessly.
What is an innovation strategy?
Innovation is about creating new value your clients want to pay for, whereas strategy is the tactic you use to achieve your purpose. An innovation strategy maps your mission, value proposition, and vision for a target audience. Some entrepreneurs describe it as a clear-cut roadmap for the desired outcome. When you set innovation goals, consider your overall business objectives because you can boost your operational efficiency and prevent the silo effect only if you unify your vision goals. Innovation should contribute to your bigger plan, so determine how it can help you achieve it.
Adding innovation to your business development process starts with identifying the best way to win. You pinpoint the steps you must follow to put your strategy into practice and systemize the plan to avoid messy and confusing chores that may prevent you from implementing it.
How can you develop an innovation strategy?
The first step is to define your winning aspiration by writing down your innovation objectives. What do you want to achieve with this strategy? Check your long-term goals and the factors that can help your company grow. Your innovation strategy must support your brand’s objectives and vice versa.
Know your target audience
Define your playing field to ensure your innovation strategy responds to your clients’ needs and conduct market research to identify the customers’ issues and requirements. Don’t copy the method that worked for one of your competitors, but study and learn from it.
Define your value proposition
The most critical step in creating an innovation strategy is to define a unique value proposition. What innovation allows your brand to get a competitive advantage and capture value? Focus on the processes that save your clients time and money, make them willing to pay more for your services, improve your products’ performance, or make them more affordable or durable than the competitors. To create a unique value proposition, you need to identify and exploit new uncontested markets.
Determine what your business’ core capabilities are
During this stage, you need to develop the necessary capabilities for winning with your innovation strategy. To create your brand’s core capabilities, consider your knowledge, values, culture, behaviors, skills, and R&D.
Establish your innovation tactics and systems needed to employ the strategy
During the final step, you need to identify the tactics and systems you need to execute your innovation strategy. What tools do you need to bring your innovation infrastructure elements together? What systems should you use to measure the results?
Christopher Freeman has published a study that defines the system of innovation as a network of institutions that conduct operations that create, upgrade, use, and share new technologies. Make sure your innovation strategy remains a priority for your brand in the long run, and stay focused on your goals.
Tactics top brands use to maintain their success
The most successful companies on the market use four main practices to maintain their success.
Find the next S-curve
Success isn’t everlasting. All products and services go through a predictable cycle of growth and maturity, also called an S-curve. The perfect time for innovation is when the first growth curve reaches the inflection point. Sadly, it’s challenging to determine when your product reached this point. So, it’s best to be paranoid and make innovation a continuous process. When he returned to Apple, Steve Jobs implemented this tactic and challenged the brand to break out of the market bubble that kept the company at 10% market share. He introduced to Apple’s line of services and products a game-changing retail channel, iPad, iPhone, and iPod. It took him eight years to transform Apple Computer into Apple Inc, but the brand is now a force to be reckoned with.
Lean on customers
Top brands understand what their clients want. They use customer empathy maps that allow them to identify opportunities and create value. The customer data is the base of their approach for creating innovation strategies. Few companies invest time into getting to know their public. Lou Gerstner created Operation Bear Hug for IBM to allow the brand to stay in touch with the clients. Fifty executives visited five customers every week and delivered a report to Gerstner with their findings.
Approach the problem like a designer
Managers are trained to come with solutions, but designers use their imagination to deliver innovative products. Apple delivers a top-notch user experience because Jonathan Ive, a highly-skilled designer, has created the systems. Design requires a particular set of skills and aptitudes that encourage innovation.
The management of the brand should lead the way
The CEO is the only one who can make innovation a priority for a business because it requires risk-taking and exposure to failure, and there’s no other role that can expose the brand to liability. Howard Schultz decided it was time for Starbucks to change its road and met with all store managers worldwide to find a way to redesign the café experience they provide. Google encourages employees to take a day away from work to reflect on innovative ideas. Innovative leaders are role models; employees follow.
Here is how top brands create innovative strategies and maintain their position on the market.