Marketing involves creating, selling, and distributing goods and services that the consumer wants and needs. Innovators need to understand consumer beliefs, attitudes, wants, and habits if they are to be successful. Consumers want products and services that “get a job done.” Quality gurus like W. Edwards Deming and management gurus like Peter Drucker write extensively about understanding the consumer. Innovation requires deep understanding of the consumer’s needs and then providing for those needs.
Marketers try many ways to meet all consumers’ needs and wants. Salsa has become popular in the last two decades in the United States, and dozens of suppliers have jumped to feed everybody’s salsa needs. Visit the salsa offerings of a big box grocery store, and dozens of offerings will pop out at you: mild, medium, hot, hotter, mango, pineapple, and chili. Salsa comes in tall thin jars, round jars, short squat jars. The world probably does not need another salsa, except maybe dark chocolate flavored. (Now there’s an innovative idea!)
If you are going to develop a new product or service, you need to either totally delight the consumer, create a whole new category, or find a whole new group of customers. Doing any of these successfully necessitates innovative thinking. Questions which need to be addressed include, but are not limited to:
• Who is your customer? Who will be your customer be in 10 years?
• How can you recombine customer benefits in a unique way?
• Where is innovation possible along the value chain?
• How can you maintain a favorable cost structure through your own production methods?
• How can you leverage your core competencies in new and different ways?
• What jobs do your consumers need done that you can help with?
• How can you reinvent the customer experience in ways that will delight them?
• Who is your competition ignoring?
Asking these questions can mobilize members of your organization to think innovatively and differently about your product/service offerings. These open-ended questions are invitations to discussion, debate, and think creatively and originally. Innovation starts with the consumer.
Market segmentation and target marketing are recognized methods of getting close to the consumer. Market segmentation involves delineating one or more groups of consumers: teen girls, affluent senior citizens, small town middle class, or chic urban upper class. Marketers then target their tailored offerings to one or more of these segments. For instance, Nordstrom’s department store focuses on affluent consumers, while Aldi’s Food Stores aim at more budget-conscious grocery shoppers.
Innovative organizations often find market segments that are underserved. For instance, distance learning provided education options to people who had no nearby college to attend. Early air conditioner units in China were loud, relatively ineffective but very inexpensive. Yet for those who never had air conditioning, they were a blessing. Tata Automotive is introducing a car to the Indian market for $2,000, aimed mostly at consumers who have never had a car.
Another underserved segment might be affluent people who want more “bells and whistles” on normal products and will pay for them. High-end restaurants with valet service, Blackberries with GPS systems, first-class airplane tickets, and minivans with built-in DVD players are all examples of segmentation.
Innovative marketing can also involve finding an underserved market segment—a group of potential consumers that other companies have left behind—and creating offerings for them. This process often requires identifying unarticulated needs. I didn’t need an IPod because I didn’t know it was possible. I would have never told a researcher that I wanted cup holders on my baby’s stroller, but I like it. Innovative marketers are always on the lookout for these unique, unnamed opportunities.
Beyond this hunt to fulfill customer needs, innovative marketers look for ways to partner with customers to create more powerful offerings. Innovators need to harness the energy of their consumer “champions.” Harley Davidson, the motorcycle manufacturer and distributor, has done an excellent job of this, creating user groups, Harley accessories and events for Harley enthusiasts. Heck, Harley lovers tattoo themselves with the logo and proudly wear gear covered with it. Have you ever seen a husky man with a Walgreens or Nordstrom’s tattoo?
Innovative marketers make consumers into prosumers, people who help create a customer experience while consuming it. Prosumers at churches attend the church but also sing in the choir, teach church school, and sit on the vestry. Facebook users are prosumers and consumers at the same time. That’s the goal of innovative marketers.