Product Innovation Charters must define market by needs and value and not your product

Product Innovation Charters (PIC's), still tend to  be defined around whatever industry or product the organization operates in. Thus, if you make cars and are trying to innovate to the next model your entire focus on building up the PIC is based on the existing car and its technical specs like mileage,technology, space,speed and so on. By just staying with this "internal" focus innovators make a big mistake.Here is why:

  1. Ties your team down: When you define markets in terms of products and product categories – you have already tied down your team. If you say "mid size sedan" market – you have just put boundaries on how your NPD team thinks. Instead, it is far better to pin-point some needs that are being unfilled in that market segment ( let's say more leg room in the back seat) and emphasizing those needs.
  2. The market is outside the organization: sounds obvious, but it is quite amazing how most organizations are caught up so much in their own drama, that they are simply not able to look and observe what exactly their current customers and potential target customers are looking for. And this is after their marketing research and analytics suppliers tell them, some of their braver advertising agencies tell them because these folks are suppliers and live outside the company and therefore have a better sense of the world outside.
  3. Internet and social media  does not help: if you are not willing to look to the market and consumer the huge insights from the Internet and social media is just not useful. Because you are not willing to look primarily at your market and consumer- you are unlikely to even Google stuff !
  4. Products proliferate while needs are unmet: Think of Apple iPhones and many of its competitors. Some troubled competitors got into trouble because of product proliferation. Too many products and too little focus since each product had a Product Manager who needed a budget, advertising,branding and distribution in part to prove that "work was being done." Numerous examples exist from the auto industry, foods and consumer products etc.
  5. Avoid the Better Mousetrap Problem: By avoiding a product focus, in contrast to customer needs and value focus, you can avoid the "better mousetrap" problem made famous in the marketing myopia concept, discussed in an earlier post.

In summary, try to define your markets and consumers by looking at them and what they do. Do not define markets in terms of existing products in your PIC. And it doesn't matter if you think in term of your own products or other competitor  products. Contact StratoServe.

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