Innovation isn't for current customers

There was an interesting opinion piece in Sunday's Boston Globe by Tom Scocca, The Downward Spiral of Progress.  The tone was somewhat tongue-in-shoe (sic!), but the idea was something I hadn't considered in this way before.

The idea, in a nutshell is that once a company has you as a customer, particularly as a customer of a brand, they have much less incentive to focus on keeping you as a customer because you have already bought into the brand.  The brand needs to expand to draw in new customers, so the do silly (to the existing customers) brand expansions or product overhauls that add no value to the existing customers - and sometimes even degrade the customer experience, as described in the article.  Or as Scocca describes it:

When a product gets disimproved, the company behind it is trying to give you more - but not you, personally, exactly. Someone else, some other person, who still must be wooed. The satisfied customer, his or her needs having already been accounted for, can be dispensed with; it's the dissatisfied customer, who still wants to buy things, who makes the system run. The moment you're comfortable enough to stop thinking about your choice is the moment your choice is most likely to be yanked away from you.

My favorite pet peeve along these lines: I wonder at the grocery store over all the variations on good old orange juice or cranberry juice.  And which one is always sold out?  The standard variety, which I would buy if it were there. 

Of course, there are plenty of examples where improvements are geared toward current customers and provide real benefit.  It was interesting to read the article and think that there are always multiple forces at work in this environment.

Standing back, this argument sounds similar to what Clayton Christensen talked about in The Innovator's Dilemma.  Companies get stuck making improvements for their current customers.  It's usually new companies that come along and make things that new customers (new markets) want, eventually displacing the established companies when the new product becomes good enough for the old customers.

2 Comment(s)

Mary Abraham Author Profile Page said:

Jack -

Perhaps the answer is that innovation should be for the current customer up until the point of diminishing returns where all you are doing is "gilding the lily" (e.g., changing the packaging on those juice containers). The real trick is in figuring out exactly when to stop fiddling with a decent product or service -- AND to always have someone on your team who began focusing on a disruptive one a long time ago.

- Mary

Babysitting the current customers and luring new customers are both (but therefore not equally) important for (brand/company) survival. They require different marketing strategies, possibly product/service diversification (standard orange/cranberry juice is still being sold, supposedly), etc. And certainly, expanding the customer base seems a stronger driver for Innovation...


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