Companies’ lack of innovation investment
There are just 11 per cent of marketers that allocate money for marketing innovation efforts. A smaller 9 per cent make marketing innovation a part of every marketer’s budget. However, a huge 95 per cent said they were receiving a good return on investment for their innovation spend. How has this large discrepancy come into play?
In Ad Age, Bert Dumars writes that the customer landscape is constantly shifting and evolving due to digital disruption, consumers connected to the world around the clock and changing customer expectations.
Digital competitors are using the online space to break away from traditional methods of connecting to customers. The same survey found that most of these firms were at an early stage of innovation maturity. Four main innovation cultures exist:
Risk-averse: Common in highly regulated industries or where they operate as a monopoly. Only innovate when forced.
Pragmatist: Conservative where the majority rules, which means they can be slow to change. These large corporations are at risk from smaller, more flexible businesses. Accounts for 60 per cent of businesses.
Experimenter: Highly focused on innovation that centres around the customers, but without a long-term strategic direction.
Customer-obsessed: The customer drives every innovative pathway these businesses take. A rare 3 per cent of firms fall in this category.
Innovative leaders don’t focus on what a customer wants today: they focus on what a customer will want tomorrow. Marketers need to accelerate their brand in a world that is changing fast. They can do this by:
Making the business case for executive level support. This involves the chiefs of the company. Only 20 per cent of marketers receive support from the people at the top, but getting them on board is essential for any long-term innovation strategy. Build a business case by putting together a budget and expected return on investment. Conduct pilot tests, monitor results, and harness those that show potential.
Leveraging customer insights to take an innovation-anywhere approach. Only 40 per cent of firms gain innovation inspiration from their customers and technology and agency partners. Marketing teams should record and monitor their company’s digital touchpoints, and often. Also, make use of employees that are active in the digital space, including those that know their way around platforms such as social media.
Establishing a dedicated marketing innovation budget and holding the team accountable. Coca-Cola’s marketing model is 70-20-10: 70 per cent of the budget for now, 20 per cent for new and 10 per cent dedicated to finding out what’s next.
- Five Steps to use Innovation to find Market Growth Opportunities - September 23, 2019
- How to recognise Innovation Theatre - September 2, 2019
- 5 Ways to Create a Customer Centric Strategy - August 22, 2019
- The Future of Leadership – Empathetic Leaders - August 11, 2019
- Creating Time for Innovation - August 5, 2019
- 10 Lessons to Learn From Startup Failures - August 5, 2019
- The Top 5 Digital Transformation Insights from Mary Meeker’s 2019 Internet Report - June 20, 2019
- Bridal Wear and Business Model Transformation: What do They Have in Common? - June 19, 2019
- How Amazon is Reinventing Retail – Literally from The Ground Up! - May 28, 2019
- Bezos’ letter to shareholders showcases great communication and strategy - April 29, 2019
Managing Director, The Strategy Group
Dr Tobias is an accomplished innovation consultant and entrepreneurship strategist, drawing expertise from the academic, entrepreneurial and corporate worlds. Jeffrey’s commercial and business experience is particularly focussed on lean startup, design thinking and leadership. Prior to The Strategy Group, Jeffrey was Cisco’s Global Lead for Innovation in the Internet Business Solutions Group helping Fortune Global 500 companies improve customer experience and grow revenue by transforming how they do business.
Jeffrey is a professor of innovation and entrepreneurship teaching MBA students at the Australian Graduate School of Business at the University of New South Wales. An active angel investor, Jeffrey is on the board of various well known startups. Jeffrey’s corporate background includes leading global innovation strategy at Cisco, working with large corporates such as Adobe, Westpac, Telstra, Woolworths, and Perpetual.