Believe it or not I’ve heard business owners tell me that if they’re innovating, they want to charge a high price. First of all, a truly innovative ideas makes it’s benefits accessible to as many people as possible. This means the cost of entry for the customer is lower, not higher.
Case in point: Dippin’ Dots.
Supposedly they were the ice cream of the future. Not so. They filed for bankruptcy a few weeks ago. Sure the technology behind it is pretty cool but it doesn’t make the product more delightful than the traditional creamy ice cream. Dippin’ Dots doesn’t dramatically change the customer experience either. Eating ice cream the old fashioned way, with a cone, is still an irresistible experience.
Another issue, and this is the kicker, is that Dippin’ Dots are too expensive:
“A 5 oz cup sells for around $2.29 at your local mall or fair ground. That adds up to around $7.32 for a pint compared to $5 for a pint of Ben & Jerries or far less for a non-premium ice cream. It costs a lot of money to cryogenically freeze tiny beads of ice cream in small batches. Innovation is supposed to make things cheaper.” – Business Insider
Again, a lot of focus is placed on product innovation. Technology alone isn’t necessarily going to take your company up-up and away. What you can charge a premium for is a great customer experience.
There is also this belief that because you added more features to your offering, then it makes it the best. Therefore the consumer should pay more for these features. Not so. If anything, having the most important features that the customer really values is what really matters. So if your product has only three features but those three features makes your customers lives better than a similar product with 10 features, kings to you. You may own a key moment, place, act, thought, emotion in their lives. And that’s all that really matters.
Less is more. Literally!
Jorge Barba is an Innovation Insurgent and is the Creative Strategist at Blu Maya, a San Diego based Digital Marketing Firm that helps organizations build their online business with strategy development for new products and services. He’s also the author of the innovation blog Game Changer. And lastly, you can follow him on Twitter @jorgebarba.