Mapping The Cost Of Innovation

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Many companies claim that they place an emphasis on innovation – and to a point, they are delivering – but when it comes specifically to marketing and buzz generation, companies set themselves up to fail in the innovation category.

Sure.  They may execute a campaign that utilizes a new technology or create a video that goes viral and generates an insane amount of views. They might even develop a marketing product that revolutionizes the industry or makes use of an existing product in ways nobody thought of before. But when it really comes down to it, most companies fail when bringing innovation to their marketing because they don’t plan or spend in the right way that lends to cost-savings down the road. Or, even worse, the execution doesn’t align with their strategy, so it hits the intended consumers like a thud.

Many innovative marketing products could be better if they were not treated as the end-all product that is oft copied, but as something that builds upon itself. Innovation done correctly is built with future iterations in mind so that products and development can be built on or added on cost-effectively. Too often, those new product are developed for one execution and then, upon its success, they do not allow for augmentation – forcing companies and their vendors to start from scratch.

Numerous factors lead to innovation that is not cost-effective.  Sometimes, due to a lack of vision or strategic planning.  Others might be due to a company’s lack of determination in supporting ongoing innovation expenditures. And then sometimes, products just don’t work out. All of those factors, are reasonable explanations for the waste of money but they don’t need to be. It really comes down to the ability to have long-term vision and communicate objectives well.

With the right executives supporting the long-term innovation play – where a specific near-term ROI may not happen – the environment can be ripe for marketing success for quarters and years to come.

Here’s how you do it — think more than one step ahead. Auto manufacturers build concept cars with the full knowledge that the car as a whole might not make it to the dealer, but components like auto-parking most likely will.  With that vision toward the future derivatives, even an unsuccessful campaign is not a waste of money. Be thinking of what components might be re-used in the future and make sure your team and vendors build those elements accordingly.

Granted, some form of smoke and mirrors is a component of your innovation process – and not in a devious way – you might think of innovation as putting the cart before the horse.  What it does is build an environment of hype that points to a vision of what the future could be. Be prepared to create assets that just show off what you are planning to do in order to effectively communicate expectations within the company. Utilize communication and spin control. If innovation is treated solely as a magic force that nobody has insight into, it is doomed to fail in the long run.  Even the major technology companies that have super-secret labs share some of their developments internally and sometimes, even externally. Maintaining to others that you are doing really cool things under a shroud of mystery will only lead to further questions on the money that’s being spent. Conversely, communicating too much without conveying the ultimate vision can be almost as damaging.

To the finance types, developing key KPIs to measure your success is a necessary component. Innovation is not an always-win proposition. You may not find huge marketing numbers to point to a winner. Come up with those elements that prove its working.  Is it money saved on future campaigns?  Is it press coverage of your marketing products? Is it related to time-to-market for future products? Is it tied to sales? Brand recognition? Whatever it is, make sure that is known to your team and management. Without those clearly understood KPIs, you’re effectively spending a lot of money on just an illusion…

When all is said and done, there needs to be an environment or atmosphere that welcomes trial and error. Intrinsically, there is no other undertaking that comes across so much success and failure with few traditional methods of measuring both. It is those corporations and organizations that truly embrace innovation (and not just tout that they are innovative) who most consistently bring successful innovations to market. Sometimes innovation can seem just outside your grasp (as an individual or an organization) but with vision, communication and execution, it will come back x-fold in marketing and revenue streams you might not have even considered at the onset.

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