Innovation – Driven by Customer

Numerous studies demonstrate that 70-80% of all new products fail. Lack of relevance, lack of differentiation, inappropriate pricing and not-clear messaging all factor into a brand’s struggle when launching a new product.

However, the ultimate judgment of new products falls to consumers, who, ironically, are often absent from the development process. That development stage stands the greatest chance of generating transformative new ideas early on, before the brand has made a significant investment.

Product creation and adoption are enormously difficult. Not everyone can be like Apple. In fact, only 4 percent of the products you create will succeed past the second year of their launch. And big brands fail spectacularly, too. Witness the failure of Lifesavers soda pop or Ben-Gay aspirin.

Well, could the creators of Lifesavers soda or Ben-Gay aspirin have known that their products were going to fail? Well, yes. Consumer co-creation could have uncovered an important insight to prevent a product failure.

Over the last decade, consumers have helped brands to drive front-end innovation and generate their participation in all stages of a product’s lifecycle largely due to internet. Many brands are NOW investing in “customer co-creation” techniques to avoid late-stage product failures.

The brilliant concept of ‘Crowdsourcing’, in which a broad pool of consumers is invited to suggest ideas and/or respond to specific design challenges, has been widely adopted by marketers. The strategy can potentially shorten the time it takes to get new products to market, not to mention, can leverage an empowered consumer culture. For example, uses an online e-suggestion box to solicit ideas from customers, who can also rate the ideas of others. The company then reports back to this “crowd” of engaged consumers when certain ideas move into development.

But with advantage come together are the disadvantages too. Here is why : For all its benefits — including a broad reach and a high volume of submitted ideas — this approach poses significant challenges. For some brands, the sheer volume of ideas can be daunting to review and assess, sometimes because these sites become prime targets for disgruntled customers to post their customer-service grievances. In addition, these sites’ public nature makes it easy for competitors to pounce first on promising ideas.

For this there is an alternative of ‘Private Communities’, where you interact with customer longitudinally, with a smaller groups (200-400). This format also enables community facilitators to lead an ideation and concept development process that is more structured — thus, potentially more fruitful.

Should You Involve Your Customers in Product Creation?

Regardless of whether you opt for a public or private approach, there are several factors to consider before investing in a co-creation initiative.

  • Recruit the right customers. Carefully consider the types of people from whom to solicit ideas. Think beyond their key demographics and consider recruiting them based on their creativity and problem-solving skills.
  • Use a structured approach. Don’t ask consumers what they want in a new product without giving them a structured brainstorming approach, or something to react to. Wide open, blue-sky approaches place too much pressure on consumers to produce what they think is “right” in your eyes. They’re more likely to apply principles and ideas from other companies to your product when they don’t have a structured approach.
  • Manage your expectations. Consumers can only produce ideas based on what they know — their needs — and are not equipped with the knowledge of what’s feasible from a financial and manufacturing perspective. Thus it’s crucial to have processes in place that enable internal R&D resources to vet, narrow down, and refine consumer-generated ideas.
  • It’s more about needs than solutions. Start by determining unmet needs or barriers. Then, feed those needs back to consumers to help inform their ideation process. The ideas your customers generate may not be production-ready, but you can use your understanding of those needs to develop consumer-relevant products of your own.
  • Seek fresh eyes in evaluating ideas. In addition to asking the people who submit ideas to also rate them, consider transporting those ideas to a different venue to get a fresh outlook.
For example, Unilever used face-to-face sessions with young men to develop a new brand extension for its AXE product, the AXE Twist.  Of course, AXE being AXE, the “focus group” included a lot of sexy fun for young guys in a get-away location for Spain – a totally appropriate way to get customer feedback given the nature of the AXE product.

Co-creation is an immature market. Although 80 percent of product strategy professionals use social media to engage with consumers, far fewer do so for product co-creation. And yet, consumers are interested in product co-creation. A private Forrester survey reveals that 61 percent of U.S. adults online are wiling co-creators. But to involve them, marketers must set expectations for the time commitment and reward the co-creators.

Reward need not mean a financial payment, either. Public recognition for helping launch a product can be a powerful incentive.

This way you end up involving consumers from the very beginning of Product life cycle. A product is for customer…and it should be By Customer too.

All about Marketing…Customer Needs, Wants, and Demands

This is my own effort to learn marketing (courtesy : Principles of Marketing)

… hence from now onwards with every effort being made towards learning, I will try and make it easier for myself and also for few of us, who are not so sure about this process called Marketing…

Simply put, marketing is managing profitable customer relationships. The aim of marketing is to create value for customers and capture value from cus-tomers in return. we define marketing as the process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return.

The Marketing Process:

Think of Marketing as a five-step model of the marketing process. In the first four steps, companies work to understand consumers, create customer value, and build strong customer relationships. In the final step, companies reap the rewards of creating superior customer value. By creating value for consumers, they in turn capture value from consumers in the form of sales, profits, and long-term customer equity.

Let’s see what is this five step model all about?

Understanding the Marketplace and Customer Needs

” Marketing is all about creating value for customers. So, as the first step in the marketing process, the company must
fully understand consumers and the marketplace in which it operates.”

As a first step, marketers need to understand customer needs and wants and the marketplace in which they operate. There are five core customer and marketplace concepts: (1) needs, wants, and demands; (2) market offerings (products, services, and experiences); (3) value and satisfaction; (4) exchanges and relationships; and (5) markets.

Let’s talk about in this post :

Customer Needs, Wants, and Demands :

The most basic concept underlying marketing is that of human needs. Human needs are states of felt deprivation. They include basic physical needs for food, clothing, warmth, and safety; social needs for belonging and affection; and individual needs for knowledge and self-expression. Marketers did not create these needs; they are a basic part of the human makeup.

Wants are the form human needs take as they are shaped by social, cultural and individual personality. An Indian Needs Food, but wants a Mac Burger, Pizza or a soft drink…for a person living in high society the same need may have a different want, than a person living in lower middle class society…another example would e a need to have a way to commute….a lower middle class would want a Nano, and probably would be satisfied, whereas a high or upper class would not go for less than a Merc…

In short

Wants are shaped by one’s society and are described in terms of objects that will satisfy those needs.

Here comes the Buying Power where by a Need from Wants becomes a Demand.

At Zappos, CEO Tony Hsieh uses Twitter to build more personal connections with customers and employees. Some 1.6 mil-lion people follow Hsieh’s Twitter feed. And at P&G, executives from the chief executive officer down spend time with consumers in their homes and on shopping trips.

Marketing companies want to understand as to what are the needs, wants and how they can be converted in to demand using or targeting a specific segment.

Your company’s blog…it Sucks? It does not have to…

Some brilliant insights from Mark Schaefer, directionally all of these are good recommendations based on facts. If 71% of buyers from the 2011 buyer report from Buyersphere reference blogs as part of the first stage of buying, then it might be a good idea to have one. I talked to few small and big names who have been in to this business from past many years…and this is what they have to say:

1. Our buyers don’t use social media and alike: Well with over 750 Million people on facebook, there just might be some of your customers there. Maybe Facebook isn’t the right place for your industry, but LinkedIn is north of 200 million, so there might be a couple of buyers there for you to engage and build relationships with.

2. I don’t have time: If your competitors using social media, you better get time out from your busy schedule…How do they have the time? I guess they make the time, you should too.

3. We don’t have that much content: Really? Talk to your own CEO, talk to your customer, have their pain points and the mitigations on your blog, how about placing the call which that customer made yesterday evening, when your products did a wow for him…As marketers and product folks we are writing all the time, but if you don’t have content – ask others in your business. Who? People in development, support, professional services or must be having many smart people working for you…

Why Your Influencers Matter Now More Than Ever

Influencer Marketing is the most important new approach to marketing in a decade for those professionals trying to influence decision-making.

Influencer Marketing is the most important new approach to marketing in a decade for those professionals at the leading edge of purchasing decision making. It shows that key decision makers in all major markets operate within communities of influencers- because major decisions are too complex and risky to taken in isolation. As mass media impact wanes so the role of influencers grows – marketers need to know why and how to use this knowledge. The impact of blogs, wikis and other social media is that they enable new influencers to emerge, and disperse traditional sources of influence. Large and smallbusinesses worldwide pour billions of pounds each year into influencing what they think are their influencers.

Influencer marketing is closely related to the relentless rise and success of word of mouth (WOM) and relationship marketing, and is now established as one of the armoury of new techniques professionals must use.

After reading the book – Influencer Marketing: Who really influences your customers?, here by I am to present some of the secrets behind WOM…