I often have to justify the unjustifiable on Sundays. It is a day when ordinary things hidden in nooks and cranny get attention and face threat of ouster. That is the reason why kabariwalas do brisk business on Sundays. A small box in my home is a refuge to a lot of discarded objects which also houses a single piece of cuff link. Preserving a single cuff link does not make sense. It is neither likely to be used nor gifted to someone ever. Hence it does not make any sense to keep it especially in times of space crunch in urban dwellings. Tremendous pressures are mounted on me to throw it but I don’t. And at the end I am called an idiot when it say, ‘throw everything out but not this link’.
My stickiness with the cufflink is beyond the comprehension of reason. For the others the cufflink is just an object devoid of any use value or sale value. And there are other cufflinks which score very high both on use value and monetary value but hold little importance to me. To a reason oriented mind this phenomenon is nothing more than an absurdity. But here lies an important branding lesson. Some brands manage to create this kind of stickiness that their customers ‘go at great lengths’ and ‘pay absurd prices’ to buy them, own them and preserve them. Consider a Rolex or an Apple customer. The important question here: is Rolex a watch or Apple a smart phone? I have heard many people say that ‘this guy is absolutely crazy to spend ten lacs on a watch’.
There is a merit in the above observation. A brand can only succeed in a highly competitive and product parity environment through this ‘craziness’. What do strong brands thrive on? It is the strength of their bond with their target customers which borders ‘madness’ That is they work their way up to creating an inelastic demand. The slope of demand is curve is altered so much that it runs parallel to the Y-axis. The customer just does not want to consider any substitute. In fact in their mind there is a given brand or nothing else. Strong brands push their competitors out of customer’s consideration. But if brand is a product then there are hundreds others. These are all commodities in a way. Then how does one create a blind discrimination in favor?
The cufflink to me is much more than merely a device which holds the cuffs together. A Rolex is much more than a device that keeps time accurately. An Armani is much more than a finely cut and stitched piece of cloth. There was a time when the product element allowed a viable route to brand building. Swiss watch makers did this initially with exceptional watch making skills and Japanese did it with excellence in electronics and automobiles. But now a high degree of commonness running across marketplaces pushes the brands to the zone of ‘indifference’. The superior utility or functionality embedded in the product element of the brand which use to be a discriminator has now cease of an effective brand building mechanism in the modern time. It is just an entry ticket to brand building, nothing more.
Brands therefore have to find escape routes from pervasive commoditization. The boundaries imposed by the product should be transcended to create a value add which pushes the brand in ‘no questions asked’ zone. Great brand move up the value ladder and operate on high value orbit. Considerable elasticity differences exist at different levels of value orbit. A brand can escape the wrath of competition by a careful selection of the game that it wants to play in customer’s life. Consider a brand like Airtel which initially focused on signifying the network related proposition and then moved on from ‘communication network’ (coverage, congestion free, voice clarity) to ‘expression’ (‘express yourself’) and further higher on to ‘breaking boundaries’(how communication can break boundaries between countries and make the planet a better place). Similar elevation of value is visible in Dairy Milk. The brand which initially was sold on the basis as milk equivalent (see the brand sign two glasses of milk being poured into the chocolate). In the recent past the brand has transcended the chocolate element to embrace ‘celebration of life’ and now the brand is promoted on the platform of ‘kuch meethas ho jaye’. That is to create some moment of happiness (sweet not chocolate but moments) in someone’s life. A brand like Tata Tea has reinterpreted the role of tea in modern time. The role of tea is to ‘wake up’ but the business that the brand Tata Tea has assumed is to ‘awaken’ the people.
Brand building is about creating a ‘meaning’ which resonates by hitting at an inelastic inner space. The acid test of brand success is when its customer cannot articulate the reason why he or she is committed to a brand. Brands must discover to develop a subliminal connection otherwise they tread on a slippery road.
Etymologically invention and innovation have different origins. Invention is related to ‘find’ or ‘discover’ and innovation comes from the word ‘novus’ which means ‘new’. Invention implies discovery of something new to the world. When we think of inventions the images of scientist conjures up like Newton and Edison. The importance of ‘new’ for an organization stems from the fact that it must enjoy steady stream of revenue from the market to recover costs and generate entrepreneurial reward. The dynamic nature of the forces around the organization creates tensions between the firm and its customers. The new ideas must be generated and translated into actions which open up new revenue opportunities from existing and new customers.
The new ideas which have little or no revenue implications have no business relevance. The ultimate acid test for an innovation is its validity from customer’s perspective. History is replete with examples when the inventors could not take their ideas forward into making them a commercial hit. The cases in point include computer and baby diapers. Both IBM and P&G benefited from others’ discoveries and went on to create huge business by innovative marketing practices. New discoveries and ‘finds’ have no use unless these are applied to create something of value for the customers. Business organizations are essentially innovation playgrounds. And the competition between firms is about innovating new ways to making customers life better. This requires unshackling the innovation concept from the narrow by lanes of product and technology centric interpretations.
Consider enormously successful business corporations like Dell, IBM, Apple, McDonalds, Southwest, Federal Express, Starbucks and Rolex. If doing better was the key to business success then we would not have had automobiles rather faster horses. Betterment of an existing product or practice offers leverage but only up to a point. It is much easier to progress in a linear fashion. Clinging on to something familiar is much more comforting than experimenting and creating something new. Doing the right things is more important than doing things right. Since the environment is not a linear extension of past, the discontinuities and disruptions render the old model of incrementalism a risky proposition. Therefore products and services have become better, but better commodities. Betterment provides no guarantee from commoditization.
It is for this reasons a large number of firms fight their battle trapped in incrementalist mindset in most industries. Take for instance computers- box with microprocessors and some circuitry- has high degree of commonality among brands. This is true for many markets. A large number of firms see things as they are and try to make them better but few firms see things which are not there and innovate. Apple’s innovative view of technical machines like the computers and mobile devices has made the company what it is today. The experiential perspective it took to look at computers and mobile instruments has been the crux of innovations at Apple. Nokia on the other hand is beginning to crumble under its own burden for the want of innovative customer centric perspective. Innovations in aesthetics and use experience have created strong contenders like Apple and Samsung for Nokia.
A business organization is collection of activities and decisions. Setting of the routines set in different functions is an organizational necessity but getting frozen in these could be a serious handicap. Innovation opportunities exist everywhere from human resources, to finance, to operations to marketing. A mold shattering perspective is essential to introduce innovativeness. Each function in its own way contributes to organizational effectiveness. The crucial question to ask is: how does it affect our customers? Does it give opportunity for them to upgrade? Does it open acceptability in new customer pockets? Does it make them better use experience? Ultimately the takers of entire organizational acts or decisions are not the people inside rather they are outside. Innovation is about enriching customer experiences and meeting unmet needs with the product or service that a firm markets.
The following marketers had uncanny ability to look at the market and industry unlike others. It is their capacity to go of box of canned perspective and practices led them to do things differently:
Dell: revolutionized the way computers were looked at. It created the concept of ‘fresh’ PC which consumer could configure as against standardized model marketed by others through conventional distribution. Dell shipped directly to consumers from their factory eliminating the middlemen.
Advertising: one of the oldest once that I am reminded of is that of Volkswagen after Second World War. It could connect with prospective customers by lightening the atmosphere for Beetle in campaign with headlines like ‘The Lemon’ and ‘The Bug’. Similar feat was achieved by Pepsi in their campaign ‘Nothing official about it’. Vodafone could beat the clutter by innovative ‘zoo zoo’ promotions.
FedEx: Fred Smith innovation of overnight express service was to change the postage delivery worldwide. FedEx pioneered hub and spoke model to ensure that packets are delivered absolutely by ten the next day. Express delivery service catered to unmet needs of customers and created a new market space.
Southwest: There was land, air and sea transportation. And how air travel industry operated and the market it served, the rules were cast in stone. Airlines sold tickets via agents, did bookings, assigned seating, served meals on board and adhered to schedule. Southwest created the concept of no frill taxi in the air service and went on to become the most successful airline in the world with consistent profit performance in its history.
McDonald’s: known for ‘QSCV’ (quality, service, consistency and value) principle created a revolution of sorts by offering highly consistent burger delivered very fast to customers. It was out of box approach to feeding customers when the out of home food implied dine in restaurants. McDonalds’ challenged the way restaurants operated through a series of innovations which meant that their burgers were assembled not cooked in their outlets. There was a lot of supply chain innovations carried out to create what we know as McDonald’s.
IBM: gradually shifted from hardware business to what is called ‘solutions’ business. Instead of waging a war and fighting heavily by putting computers in the center of their universe they instead put their consumers at the pivot. The out of box perspective to what customer were looking for led IBM to innovatively push the hardware to the fringe of their value constellation. The commodity rut that plagues the hardware business now does not affect IBM for now it has moved up to a higher scale of value ladder.
Cease Fire: this product took very innovative approach to fighting fire by giving potential customers as easy to use fire extinguisher. Unlike big cylinder type hard to use and manual (in case of fire first read the instruction type) driven fire extinguishers this product innovation made firefighting a child’s play. The product innovation-small easy to use spray can- was not a liner extension of the way fire extinguishers were made and marketed.
Toyota: It was not unnatural for a car to breakdown. It is mechanical system and it would. Toyota’s relentless pursuit of innovations at the shop floor and operations revolutionized quality in automobiles and thereby making them trustworthy. The innovations such as JIT, quality circles and poka yoke directly led to products that meet customer needs better.
Apple: the essence of Apple brand is reflected in its symbol (bitten apple). Apple’s out of box approach has been to take ‘brain’ products to a new aesthetic and experiential level after all not all customers are tech geeks. As good medicine has reduced toxic effects, Apple products are about simplification and ease. This is easy to appreciate for users but imagine the difficulty that technology nerd would have form whom complexity gives kicks. Apple’s feat is precisely is achieving this internal transformation where in a technology person thinks like a potential customer.
Business entity is a constant but the environment of which it is a part of is dynamic: competition, customers, technology, economy and pressure groups. The intersection of a constant with dynamic has an upsetting effect. As a result products and organizations are pushed out of the marketing spectrum when customers abandon them. Therefore organization needs to evolve by innovating everything it does. Even areas like human resources and finance have enabling effect on marketing effectiveness. A business organization is what its managers make it to be depending upon their perspective. In order to appreciate innovation imperative the managers need to step out of their cozy chambers and step in customer shoes. It is only then the difference between ‘what we do’ and ‘what you ought to do’ would become clear. Innovation is all about bridging this gap. Consider how iPod liberated people and empowered them in music management; imagine the effect of cold water Tide when it did away with the need to have hot water; think of Surf Excel which gives opportunity for better parenting (‘stains are good’ because these give a child opportunities to ‘grow’); how Gillette freed men from barbers by making shaving a child’s play ‘no skills required’; and think of ‘Ujala’ fabric whitener which took the mess and inconsistency out of the whitening process.
What in your opinion is the most Innovatiive Marketing Company?