Since the start of the year, clients have been preoccupied with “innovation” and how they can be (or become) an innovative brand. During this period, the consumers I’ve spoken with have consistently identified three innovative brands: Apple, Google, and Nike.
Client interest in this subject got me thinking: Has innovation become a component in the consumer value equation? Is this why brands are so interested in owning this association?
The value equation has evolved over the years. At its core remains three components: quality, time and price. But if innovation is an element which is becoming more central to consumer-perceived value, what is it exactly?
Here are my thoughts. Innovation requires three things:
- Initially, its “newness” must be tangible or something understood. (If something’s too esoteric, consumers may have trouble connecting with the product or service.)
- It needs to be something used (frequently) or easily integrated into a consumer’s life/lifestyle. (Interaction is key to believing there’s added value; a consumer needs to notice their life is better/different day-to-day.)
- It needs to be available or accessible to the market it’s targeting. However, for a brand to get high marks for innovation, it needs to get there first.
Does a brand need to “invent” in order to “innovate”? No. Apple is the classic case history for this. It didn’t invent the MP3 player or the cell phone or the tablet computer. But clearly, Apple innovated technologies based on a belief that it could create a better user experience coupled with its “rebel with a cause,” anti-establishment attitude.
Google has been an innovator (and some might say inventor) from the start. But lately I’m hearing the most about Google Apps and the new Google Droid cell phones – innovation not invention. Along the way, it has become a more mainstream consumer brand (vs. a mere verb for finding things on the Web).
Nike has a history of “inventing” new technologies, borrowed heavily from other industry applications, and building them into its shoes and other gear. Between its sports endorsements (don’t celebrities always want to wear the latest and greatest?) and selling at somewhat of a higher price for the newer models, it is most often viewed as the most innovative in its category.
Dell had an innovative selling model at the beginning: they built each computer to order using high-quality components. At one time, that innovation had value; a computer was a significant purchase. As computer costs came down, and more known/mainstream/trusted players entered the market, the uniqueness of its selling model became something of an impediment. So Dell took its products to retail. An established name, but a brand I no longer consider an innovator in its field. (They are doing a good job leveraging social media as a selling tool, however.)
While innovation may be playing a larger role in the consumer value equation, my caution is this: innovation without brand loyalty is meaningless. What a brand doesn’t want is to have the cool, hot, innovative product or service of the moment, only to have early adopters flock to another brand who offers the next level in innovation. How far a brand pushes with innovation should be consistent with its branding, its place in the competitive marketplace, and the short- and long-term dividends that innovations will pay – both to the bottom line and with consumers.