Innovation needs less logic, and more magic

Great article in this month's Market Leader by John Kearon, on how the rise of "marketing science" has hurt rather than help innovation in big companies. He highlights the lack of new category creation by these big companies. Their logical, sophisticated, rigorous and data-based systems have helped them farm existing brands in established categories, but not create whole new categories. The innovators that create new category brands tend to be in smaller start-ups: think Red Bull, Amazon, eBay, Facebook.

He also suggests that the sophisticated, global "innovation centres" set up by Unilever and other leading companies have not delivered as much as expected: "The logic of taking your best people, focusing serious resources and centralising the efforts within an innovation centre, is hard to argue with. The only problem is that for almost 20 years it has patently failed to help Unilever originate the sort of new category brands that deliver the majority of the company's profits." Ow.

So, what can leaders do to create true category innovation? I propose we need more magic, and less logic.

1. Remember, research is a rear-view mirror

John reminds us that research, like a rear-view mirror in a car, can only tell you where you've come from, not where you're going (a bit funny coming from a guy who runs a quantiative research firm, Brainjuicer!). He says "Trying to research new category ideas is pretty near impossible since people are notoriously bad at predicting whether they will adopt new behaviours." He goes on to quote examples of successful innovations that bombed in initial research, including the Sony Walkman, Bailey's Irish Cream, Post-Its, Perrier (in the UK), Red Bull and Cashpoint machines." Many big companies over-rely on research to both identify and test new innovation ideas.

2. Prototype as soon as possible

What John doesn't mention is that the inventor of the Post-It, Art Fry (left), did get useful consumer feedback on his new idea. It bombed in focus groups when tested as a written concept ("Anyone want a bit of paper you can stick and re-stick?"). What worked better was prototyping the product and giving it to secretaries at 3M. They loved them. So, with a new product you're better off doing less concept testing and more prototyping.

3. Follow your product passion

Look at most stories of breakthrough innovation and you find an inventor with a passion for a product idea. And these ideas don't tend to come from a logical, sequential process starting with analysis of consumer needs and followed by idea generation.

4. Bring back local innovation?

John points the finger of blame for Unilever's lack of category innovation at global innovation centres, saying "All Unilever's new category brands (e.g. Cif, Viennetta, Dove and Axe) were invented before its much-lauded and copied move to innovation centres in the 1990s."

This is a really, really interesting point. In my experience, global innovation centres do a lot of great work. For example, the global roll-out of Dove's Campaign for Real Beauty, Omo's Dirt is Good campaign and the Axe Effect work. However, when you look at many succesful category innovations they have indeed started in one market. John rightly points out that "Magnum, Impulse and Lynx, were launched in the 1980s when Unilever was a highly decentralised, federal organisation where marketers had a great deal of autonomy".

In these cases a local dude came up with an idea and tried it out quickly, learning in the marketplace. They didn't have to fight their way through round after round of "stage-gate testing, perfecty illustrated by cartoon genius Tom Fishburne below. Also, as the ideas were local ideas, there was much less pressure on it to needing to be a blockbuster success that justified global investment.

Is it time to re-ignite local innovation, dis-band the global innovation centres, and have smaller global teams in charge of innovation expansion? These centres would work more like venture capital funds, searching the world for great new ideas, and funding their international expansion. Or is this just wishful thinking in today's global world?

In conclusion, to create new category brands we need less logic, cutting the complex quant pre-testing models. What we need is more magic, with people free to follow their intuition and product passion. And it could be time for companies to look at reigniting local innovation... more on that later.

Comments

[Yuliet]

The verdict is out as to whtheer these will be my final HGs as I have several items on my w/l yet to try, but I'm very satisfied with what I'm using enough to repurchase. I've tested many brands Sephora wore them home for day, but none good enough to purchase. For eyes, I am using using MUFE Full-Coverage concealer & Eve Pearl's salmon concealer under eyes (either/or,not together). Very pleased with both. I have, but haven't used yet, BE's Well-Rested.For the face, both Kevyn Aucoin's Sensual Skin Enhancer & MUFE's Camouflage cream. Very pleased with both. The only other face concealers on my w/l to try is Lorac's Coverup (as I wore this home from Sephora & thought this was pretty good), Ben Nye's new MediaPro & DuraCover concealers & Kryolan's Camoflauge Cream. This is as far as I will go in my quest whichever one(s)work best I will stick with. Having mild rosacea, I also have corrector colors that I haven't worked with yet: Inglot's green concealer & Mehron's corrector wheel &, at some point, will try Graftobian's corrector palette & MUFE green concealer.Now, all I have to do is live long enough to test all these out to figure out my HGs. lol!

[mulberry alexa bags]

So cute! I already like you on FB and also get your posts on Google Reader. :)

[David]

Thanks Fergus. Sounds like your client is in the cycle of centralisation to localisation to centralisation...This comes from working on organisation structure, rather than deeper culture, values and processes.
David

[Mark Earls]

Quite agree, David. Nicely put. BTW it's "Kearon"...

[Fergus Chapman]

Hi David,
Global innovation centres became fashionable as local business units became more focused on the short term and the quick win (not surprising given the average tenure of Marketing Directors). Unfortunately the safe flavour variant that pays back quickly is always going to be preferred to the risky category innovation that may not. So global innovation centres were set up... but they don't work because they tend to have no remit at a local level. Where the innovation happens should be irrelevant... companies need to create the environment where innovation can happen and has a route to market.

As a by the way, a current client of mine got rid of their central innovation team 3 years ago... they're planning on bringing them back.
regards
Fergus