We all know that innovation success is hard to come by – for decades about 75% of all innovations have failed within five years, with most failing in 18-24 months.
For an innovation to succeed, it needs to switch many (often very, very many) direct and indirect competitive product users to the innovative product. I know that this sounds like common sense, and it is, but I am constantly amazed by how often people truly forget this success dynamic.
For an innovation project, this is about where you set the bar in your vision of success. How much better do you need to be to get competitive users to switch to your innovative product?
The answer from research is very clear – you need to be dramatically better at delivering one or more of the most important customer benefits than some/most/all competitive products. Doug Hall pioneered Merwyn Technology, a highly validated and broadly acclaimed research methodology that accurately measures an innovative product’s chances for long-term success—learn more in episodes 7-11 of the Innovation Best Practices podcast. At Innovate2Grow Experts, it is the core research tool we utilize in our front-end innovation work.
From this research, we know that a product needs to be dramatically better at delivering important benefits if it wants to at least double its chances for long-term success from the average of 25% to 50%. Being dramatically better, especially in the most important and critical product benefits, can increase your chances for success up to about 75%.
So what is dramatically better? First, it is very, very difficult to persuade competitive product users to switch to your new innovative product. This is especially true with loyal users of a competitive product, who can often be the 20% of users and be 80% of product sales. The job of persuading them to switch is very, very difficult.
To demonstrate this in group situations, I ask for a volunteer in the audience who is either a loyal Crest or Colgate toothpaste user. When, for example, I get a loyal Colgate user, I say that I’m going to play the Crest brand manager and try to convince them to switch with new products we have coming. Will they switch if Crest provides a product with 25% more fresh mint taste than Colgate? No. Will they switch if Crest provides a product with 50% more active whitening ingredient than Colgate? No. Will they switch if Crest provides a product that reduces the number of cavities compared to Colgate by 75%? Mostly no’s and an occasional maybe.
To be clear, I’m not saying this is definitive research. What I am saying is that it is very, very difficult to get competitive users to switch. Loyalty is tied up in all kinds of factors – emotions, routine, consistent good results, and is the product my mom used.
Is dramatically better easily defined by the percentage of improvement? Sometimes. If I tell you that Crest will whiten teeth 33% faster than competitive products, this may be able to generate trial but probably not a lot of brand switching. Frankly, most consumers would have a very, very difficult time seeing and validating this promise. If on the other hand, I tell you that I have a new business process that reduces the time to do a task by 33%, which is reducing it from six days to four days, saving two days of work, it may be enough since time is money. So the simple answer to the question that started this paragraph is that simple percentage improvement is not necessarily a reliable measure.
There is, I believe, one reliable measure. If you show your new innovative product to competitive users and the first word you hear them say is “WOW” then you’re probably getting pretty close to the level of different you need to get people to switch. What it takes to achieve “WOW” is different in virtually every business.
We’ve all experienced “WOW” – Apple products (iPod, iPhone, iPad), Tesla performance, and Starbucks. I’m sure the readers of this article will have their own “WOW” examples.
In no way am I suggesting that achieving “WOW” is easy. It isn’t.
What I am suggesting is that “WOW” needs to be part of the vision of success you create in step one of an innovation project. You need to start with the bar set high enough to at least double your chances for long-term success.
In my innovation work, I routinely remind clients of what Jim Collins learned and shared in his insightful book, Good to Great. One of the characteristics of companies that went from good to great is that they had a hedgehog concept. While this is a strange description (at least to me), great companies define how they were going to be better than any other company in the world at something that is important to their customers – not just in one city, not just in one state, not just in one country, but in the world. This is another way of thinking about how you will achieve “WOW” responses from competitive users when they see your new innovative product.
If you start a project by setting the bar at “WOW”, you have a chance of achieving it. If you don’t start by setting the bar for the vision of success at the level of “WOW”, it is very likely you will not get there.
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Richard has spent most of his career in and around innovation – senior leader at Procter & Gamble and Gallo, professor at Arizona State University, author of six books, and a very successful entrepreneur in the innovation and creativity business. He’s a regular podcaster. Check out i2ge.com and bluesagecreative.com. Follow him @Innovate2Grow