Like the academic strategy of “Publish or Perish,” consumer brands often see their strategy as “Innovate or Die.” Companies see product and service innovations as one of the most important paths to long-term business success. With innovation being a key predictor of economic growth, Statistics Canada conducted a three year survey about Innovation and Business Strategy. The results indicate that:
- 17% of Canadian enterprises partnered with other organizations to foster innovation
- 35% of those partners were clients or customers from the private sector
- 15% of those partners were clients or customers from the public sector
- 51% of companies across Canada encountered at least one obstacle to innovation
- 22% of companies said that uncertainty and risk are obstacles to innovation
That last statistic is interesting. Uncertainty and risk are serious obstacles to any business development, including innovation. Indeed, can you even call something innovative if it’s not uncertain nor risky?
It costs millions of dollars to develop innovations, create sufficient retail partnerships to put those products in-store, and then build awareness and market those products to consumers. The risk of being boring and not innovative might be an acceptable alternative to losing millions of dollars with a risky venture. Of course, being boring and not innovative means that every competitor who takes even the tiniest risk will greatly increase their chances of disrupting your business.
Does innovation really have to be that risky? Especially when the StatsCan data shows that companies are ready to partner with customers? The path to decreasing risk and, at the same time, improving the innovation, is not surprisingly through consumer research.
- Qualitative research with customers is an excellent way for marketers to identify product and service gaps. Through focus groups and interviews with both consumers and customers, researchers can learn about consumer needs and desires, and identify areas where people need a solution to a problem. They can watch first-hand as people demonstrate problems with existing products and see how people try to accommodate for those problems. Problems that can’t be verbalized or sometimes, aren’t even conscious, can be revealed as part of qualitative research.
- Consumer surveys are perfect for identifying the extent of the problem within a specified population. With a well-designed sample of research participants and a well-written questionnaire, marketers can learn whether a problem or need is experienced by 0.08% of the population or 8% of consumers. Obviously, one of those results suggests that there will be sufficient customers to forge forward with a positive venture.
- Sensory tests are an important step in the development of any food, beverage, or personal care products. The taste, scent, and mouth feel of food and beverage products matter. Personal care products need to feel and smell good to customers, not just to scientists or product developers. What tastes and feels right in the lab is often quiet different from what tastes and feels right in the restaurant or in the home.
- Package research can help marketers understand whether a new product will stand out among all the other options on the shelf, and whether consumers would actually want to choose it. Can older people actually read the print? Can children identify it’s a product for them? Can parents find the nutrition information they need? Consumers can’t become customers if the package doesn’t provide the necessary components.
- Pricing research helps marketers understand which price point is best suited for their target audience. Sometimes, the best price is the same price as every competitive product. Other times, however, the best price is much less or even much more than competitive products. Pricing research will help to ensure that companies put the right value on their new product.
Innovation will always be risky. But by carefully conducting the right pieces of consumer and customer research, the risk will be greatly reduced. Not only will research lead to a less risky venture, it will also lead to a more profitable venture.
When you’re ready to increase your chances of innovation success, let’s talk about the types of research that could be better suited to your needs.