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ASSIGNMENT 11.1BRAND INNOVATION

AGENDAWhat is brand innovation?Type of innovationPrinciples of brand innovationBrand innovation process

1 WHAT IS BRAND INNOVATION?

WHAT

Brand innovation is fulfilling brand’spromise through new products &services and infusing these new products& services with meaningful valueswhich are relevant to consumers

PRODUCTPOTENTIAL

CUSTOMERPOTENTIALX

A TRAP ISTO BE CONFUSED BETWEEN

CREATIVE THINKING INNOVATIVE THINKING

is to create something creative

is to escalade creativity into efficiency that

meets business needs

WHYThe market has reached its climax, breakthrough innovation is needed to stand out from competitors

Consumers’ need is no longer relevant to company’s products or services

Increase efficiency in serving consumersthose are valid reasons

but they share two dangerous traits:Re-active, not pro-active

Re-active innovation means you arerunning to keep up with changes.

External, not internalExternal innovation means the worldoutside will define where you go.

2 8 TYPES OF INNOVATION

1. PROFITMODEL

INNOVATION

Innovate the way to earnmoney: bundled, flexiblepricing, advertising revenue,membership, subscriptionmodels

Gillete sells premium razors as a loss, butmakes money out of selling bladesrepeatedly

2. STRUCTURE INNOVATION

Innovate how to organize & alignyour organization, talent & assetto create more values.

Premium supermarket chain uses radicaldecentralization that enables each store tooperate autonomously to better meet storeconsumer needs.

3. PROCESS INNOVATION

Innovate with a signature andsuperior method for creating value(production, flexible manufacturing,process standardization)

Famously used process innovation todeliver a “from sketchpad to shop floorin three weeks”

4. PRODUCT PERFORMANCE INNOVATION

Innovate products that work better todeliver superior values to consumers

DYNAMIC SUPPORT: 3-layer versionNew innovation of Nike to stabilize runners andhelp them to stay away from possible injuries.

2 8 TYPES OF INNOVATION

5. PRODUCT SYSTEM

INNOVATION

Creating complementaryproducts and services thatconnect or bundle together tocreate more value

Toyota in the US through its sub-brand Scion, offers highly customisable carswith a suite of add-ons and accessories fromToyota and partners

8. BRANDING INNOVATION

Innovating how you present yourofferings and business in adistinctive, memorable, and likeableway.

Virgin, which describes itself as an“international investment group” brandsproducts and services distinctively by injected amuch-needed dose of fun.

6. SERVICE INFORMATIO

N

Innovating by adding value inhow you support customers find,buy, pay, enjoy and dispose ofyour product

Zappos made service innovation a hero andconsistently delivered a ‘WOW’ service thatprompted Amazon to buy the startup with serviceknow-how for $1.1 billion.

7. CHANNEL INNOVATION

Innovating how you deliver yourofferings to customers and users.(B2B, B2C or P2P channels, orharness pop-up stores, e-commercestores, partner stores,…)

Amazon’s channel innovationincludes Whispernet, a private wirelessnetwork that is free for customers todeliver e-books, music and films.

3 PRINCIPLES OF BRAND INNOVATION

Empathy

1

Empathize with youraudience to gain deepunderstanding of people whoyour brand seeks to serve.

Collaboration

2

Setting up interdisciplinary teams,with different people, helpsgenerate a greater breadth ofideas and can allow you to buildon those ideas in unexpected ways.

Courage

3

Dare to try and dare to fail.Learning from failures is alwaysbetter than learning from victories.

Intuition

4

If it is “just feel right” idea, it maywell be. Ideas that go againstnumbers or test may bebreakthrough ideas (seriousconsideration)

Tenacity

5

Continuing to forge ahead in the face ofadversity is critical to developing new ideas.Even when ideas don’t pan out for a givenproblem, they should be catalogued andreferred to when new challenges arise.

Play

6

Play. Imagining, free-form thinking,role-playing are aspects of creativethinking. While playing, people arehaving fun. While the outcome ofbrand innovation has seriousramifications for a business, this isabout the process, not the outcome.

4 BRAND INNOVATION PROCESS

IDEAS Fact finding & Creative

FEASIBILITYResource planning

CAPABILITY

LAUNCH PREPARATIONDisaster check

POST LAUNCH EVALUATION

Desk researchMarket researchConsumer habits research

Team set-upRisk assessmentProduct concept

Formulation testSensory TestStorage test

Consumer researchPackaging developmentProduct, cost/profitability

Plant EquipmentPlant trials

For detecting business opportunities: New product, new variants/SKU (flavor, formula, packsize) & find a way to enter the market

For justifications of investment

Actual investment

Successful launch

Fine tunning

Start mass productionSupply chainProduct application

Consumer feedbackTrade monitoring

Benchmarking

DEFINITION & OBJECTIVES DETAILS STEPS

4 BRAND INNOVATION PROCESS EXAMPLE

IDEAS Fact finding & Creative

FEASIBILITYResource planning

CAPABILITY

LAUNCHPREPARATIONDisaster check

POST LAUNCH EVALUATION

In 1970, Coca want to beat Pepsi. Coca run consumer blinded test theflavor between itself & Pepsi. Most of participants chose Pepsi’s formulabecause of its sweetness. At that time, Diet Coke which was closer toPepsi in terms of flavor and it take the position just right behind Coke &Pepsi

Coke came up with a new formula which wastested and delivered overwhelming results. Thenew formula surpassed the original & Pepsi interms of taste.

Plants have been set up to bring New Coke to mass production

Coke put its new innovation onshelves to compete with Pepsiwith the strategy of switchingcompetitors users.

Large portion of US Population boycott theNew Coke because it was not Coke anymorein terms of taste. The company decided to stopthis new innovation immediately.

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