3 Facts You Don’t Know About Innovation in Business That Could Help You Avoid Massive and Costly Mistakes
Continuing our focus on innovative thinking about innovation in business this month, I want you to start looking for innovation in different areas than you may have tried in the past. In my book Profit in Plain Sight: The Proven Leadership Path to Unlock Profit, Passion, and Growth, I share two models and 21 paths to innovation. Here are some thoughts to get you started.
Fact #1: Customers will pay for Functional Value – when it adds value.
Think about a light bulb rather than a candle, or a long-lasting and inexpensive LED vs a costly halogen, cold-light fluorescent, or short-lived and inefficient incandescent. Functional value is the typical “new and improved” approach to innovation in business, and IF the new functionality is perceived as a value-add, it will be successful. However, don’t make the mistake of spending millions developing the next Crystal Pepsi – nobody wanted to needed a clear version of their favorite drink – there was no value-add.
Fact #2: Customers will pay for Experiential Value – when you make their lives easier or more enjoyable.
We all have too little time, too little focus, and too many other things on our to-do list. Remember the days when gas station attendants not only filled the tank but checked your oil, tire pressure and washed your windows? How often do you do those things now that it’s do-it-yourself? Remember the days of bank line-ups before online banking, telephone banking, and depositing cheques by taking a photo? In some cases our self-serve society has improved the experience, in other cases, the experience is worse than ever. Customers will pay more for a better experience AND be more loyal when you make their lives easier or more enjoyable. Whether you’re B2B or B2C, you have opportunities to innovate in ways that are almost impossible for your competitors to copy when your innovation in business improves experiences.
Fact #3: Customers will pay for Emotional Value – when you give them a feel-good or peace of mind.
Why did we resist buying compact fluorescents when they were so much cheaper to use? Because the light wasn’t pleasing to senses that were used to incandescent bulbs. Emotional value trumped economic value. Why does Apple have line-ups around the block while Samsung doesn’t? There are certain intangible feel-goods to using Apple products that seamlessly share everything you need across every device you own. Samsung has a certain “cool” factor, but it doesn’t inspire the “warmth” that Apple products do. Why do Harley Davidson riders refuse to buy any other bike? Because of the camaraderie and sense of community. Why do people love Ben and Jerry’s? Why did IT managers say “Nobody ever got fired for buying IBM” back in the early days when a huge investment was required? We love products that are a delight to use, companies that are a delight to do business with, and those that reflect our values and passions. Once you own that high ground in the customer’s mind, it is almost impossible for your competitors to get them to switch.
The Takeaway
If your company could benefit from customers who are more loyal, are willing to pay more, are easier to get along with, and thus more profitable, dig into these three areas of innovation in your business, especially the experiential and emotional sides, which are often overlooked in the race to be the first with new and improved. Find out more with this complimentary 3-part video training series.
#1 Bestselling Author, International Speaker, and Accelerator Anne C. Graham is on a mission to help 5 million business leaders and their teams double their profit per employee – or more – in less than one year, in less time per week than they’re spending on email per day. Her bestselling book Profit in Plain Sight includes the 5-step proactive P.R.O.F.I+T Plan to do it. Connect with Anne on Twitter and LinkedIn.
