It’s hard to stay stagnant in business over the long run. The hope is that you’re gaining ground and growing your company and customer base. There’s the alternative, of course, but there’s no staying in neutral. Many companies try to retain and grow their market share by getting into price wars with their competitors. Others try to grow their reach by acquiring competitors.
Another option, one that can help make good companies great, is to grow market share and earn new customers through innovation.
Pricing wars can dissolve brand equity or attract customers from a different audience than your target personas. As for acquisitions — they don’t always guarantee success, and there are often growing pains associated there, too. Innovation, on the other hand, can create new income streams and increase value to existing customers, growing your revenue per customer substantially if the innovation is researched and executed properly.
Technology changes so rapidly that in order to survive, a company must be adept at keeping ahead of the curve. Thriving requires the creative, forward-thinking approach that drives innovative thinking so that you not only stay current, but in many cases one step ahead of the rest of your industry. Your customers will take notice and will often reward your innovations with loyalty.
Whereas invention is the creation of something entirely new, innovation is typically introducing something new to your business. The Conference Board of Canada explains four major types of business innovation.
This type of innovation could include creating a new division and product offering to meet growing consumer needs.
When a company improves current businesses systems — either their own or the industry standard — it can increase efficiency and get products in the hands of customers faster.
Develop new services or products that enhance existing offerings to increase your company-customer relationship timeline.
Most businesses have ways they can be more efficient or effective, and customers and front-line employees often think of these types of improvements as they use the product or interact with it. These innovations can affect the company, the customer, or a third party, such as the environment, which in turn can improve the company’s reputation.
Innovation elevates great companies because it gives them the perspective to put a spin on current opportunities and create new, useful solutions.
It can seem overwhelming to try something completely new for a business. Just like any big goal, you look around and wonder where to start. Fortunately, some of the most effective means of innovating start small and grow the creative process one step at a time.
More importantly, when a company wants to drive innovation, it needs its leadership to promote two specific lines of thinking.
In order to continually innovate, team members from the C-suite at the top of the organizational chart to the newest interns must learn to ask an important question: “How can we do this better?”
This mindset of repeatedly looking at your current business products, practices, and systems forges a culture of innovation and, with proper resulting actions, drives organizations to the forefront of their industries.
The second part of innovative thinking ties into answering the question above. An organization needs to be open to and encourage experimentation. Many times, innovation is the result of testing and experimenting with new ways of solving or addressing an old question.
Some of those experiments will not work, which is part of the innovation process. It’s only by being open to experimentation that you’re able to create better solutions. Encourage employees to create and grow without fearing the outcome.
Once you establish the culture necessary to drive innovation and help your organization continue to grow, it’s time to research multiple areas where you can innovate in order to enhance the relationship you have with your customers.
Review your entire organization and hone in on ways you can innovate in each department.
Review your product development systems and the actual end products. This research can result in the discovery of solutions that need to be added or updated, as well as some that aren’t actually needed and can be removed. Try asking questions such as these.
In addition to reviewing your own system, conduct a competitive analysis. Find out what your competitors are using or doing that differ from your products, services, and processes. Learn what they do well and how they provide important products and services to their consumers. What can you learn from other companies in your industry? This question alone can help you enhance the customer experience. The goal is to provide customers with more value.
Look into what marketing efforts were previously successful. What marketing messages and channels were effective? Which need to be changed or updated? The better our messaging and marketing, the better we can utilize our investment to reach the right audience. Denise Lee Yohn writes in an article for the Harvard Business Review, “Understanding people’s fundamental needs and drivers, identifying customers, and developing the entire go-to-market and usage ecosystem are the essential aspects of marketing — and the ones that the success of innovations, especially breakthrough ones, hinge upon.”
Research innovative ways to get to know your customers. Understand them. Use what you learn to reach out to them in new and exciting ways. Be the kind of company a customer wants to tune in to when they see messaging from your company.
The easier you make the process for customers to learn about, find, research, and purchase a solution, and then to use that solution, will determine how likely they are to buy from you again. You can even create an opportunity for continued loyalty when a problem occurs and someone is able to quickly and effectively offer support for the issue.
The better a customer’s experience, the more likely they are to remain a customer. Again: Get to know your customers. When you understand what makes them tick and how they think, you can better serve them.
First, you establish an innovative mindset in your company culture.
Then, start innovating by putting yourself in your customers’ shoes. You need a clear understanding of who your customer is, what their lives look like, and the pain points they have. You should be able to draw a clear picture of where the overlap of your company’s offerings and your customers’ lives are.
Ask yourself and your customers:
Take what you’ve learned and identify where there are opportunities to improve your internal processes or products. Explore outside solutions where necessary in order to enhance the customer experience and further build your relationship with them. Remove challenges from their path.
Many companies make the mistake of trying to innovate without spending the time to truly understand their customers. They invest finances and manpower into creating “the latest breakthrough solution” only to later determine that their customer doesn’t actually want or need it. By starting with your customer in mind — at the center of your innovative efforts — and having open conversations with them, you can avoid the pitfalls of creating mismatched solutions. This helps keep your team focused on innovating in ways that the market wants.
Try to ensure your organization encourages a mindset of experimentation. Keep focused on the question, “How can we improve what we do?” This key question will drive innovation and growth when it’s encouraged throughout your organization.
When you view your solution from the point of view of the customer and, each day, challenge yourself and your team to improve how that point of view interacts with your offerings, your company will be positioned for success.