Incubator, accelerator, bleeding edge, decacorn (a unicorn worth $10B), bootstrapping, growth hack: these are real, actual things around here, where both start-ups and enterprises believe that given the right idea and enough funding, anything is possible.
We have stopped counting the Teslas and have more apps for food delivery than can fit on our home screens. We accept that a good algorithm can change lives, and possibly the world. We absolutely believe we have the ability to define new markets and create new products that consumers didn’t even know they wanted.
The problem is, sometimes this blind faith results in things people don’t want. History shows that 95% of new products fail, and we have our share of missteps (also called “pivots” in the Valley) to prove it. For every Tesla and Alexa, there’s a Solyndra or Theranos to remind us that big ideas and deep pockets don’t always equate to success. Sometimes, trying to guess what people want can become a distraction for delivering what they really need.
All this doesn’t mean that companies can’t dream or that pursuing innovation is destined for failure. It might just mean that instead of defining innovation as a moonshot, companies should think about innovation as a collaborative process that solves real-world problems. Instead of being “disruptive,” maybe innovation is driven by feedback from real people and can provide insights that result in real change throughout the entire organization — this is how savvy companies are transforming cultures and markets within the Feedback Economy.
We got curious about this idea of innovation and its correlation with feedback data. So, we conducted our own research and asked 500 consumers and 1,200 business professionals what they thought about innovation: where it comes from, how valuable it is, and how can companies tap into feedback to drive innovation that leads to success.
We learned a lot, and most of it was good news. Because what we learned is that innovation is accessible for every stakeholder at every company. And that most companies care about what people — their customers and employees — think.
Read on to get our key takeaways about innovation.
- Customers are key
The most powerful insight that came out of our research was how feedback has the potential to drive innovation. Ninety percent of consumer respondents said “listening to customers” is the most important way companies can fuel innovation.
Consumers are also a practical group that care about their own needs over breakthroughs. In our research, the #1 goal of innovation for consumer respondents is to “solve a need.” Further, when making a purchase, consumers rank the attribute that a product is innovative as only “somewhat important.”
For companies, customer needs also rank high. Forty-one percent of business respondents said “understanding customer needs” drives innovation, which was the #1 response. That’s good news, because the majority of the consumers we surveyed believe companies should fuel innovation by listening to their buyers and customers. But it’s also interesting to note that the 90% of consumers who believe that far outweigh the 41% of businesses whose innovation is driven by understanding customer needs.
- Everybody owns it
It’s seems like it would be easy to crack the code on innovation if you’re a Steve (Jobs, Woz), Jeff (Bezos), or Anne (Wojcicki). But, as most companies have found, it takes a village — not a lightning rod — to deliver on the promise of innovation. To that end, both business and consumer respondents spread the responsibility for innovation across the organization.
Sixty-two percent of business respondents say innovation is either always or usually a part of the conversation. And, while 74% believe leadership owns innovation, customer success (47%), operations (46%), and sales and marketing (44%) were practically tied for second place.
Business respondents also seem to grasp that innovation can make an impact in virtually every area of a company. When asked what makes a company innovative, product development led with 58%, but other categories also ranked high: branding and marketing at (44%), process improvement (35%), and service and support (33%).
Consumers believe companies should do their homework to own innovation. In order of importance, talking to customers, conducting research, asking employees, and using their own experience all rank above hiring a team of experts.
- Think small(er)
It’s the little things that count. While there are amazing ventures springing up all over the world delivering life-altering solutions, a business doesn’t have to be a disruptor to be considered innovative.
In fact, for consumers, disruptive might be a dirty word. The lowest ranked attribute of innovation for consumer respondents is a product that “changes how I behave.”
When asked to describe innovation, both business and consumer respondents ranked products that are “futuristic or “a first” last on the list.
What do consumers care about? Ranking right under “solves my needs,” was “provides better value for my money”, and “improves my life.” And while “new and unique” ranked second, “uses the newest technology” was near the bottom of the list.
One final word about data
Because, again, we’re a data company, we also asked what “data” was the most important to business people. Not surprisingly, the #1 answer was customer feedback data with 78% of the respondents choosing that option. Employee data, product usage data, and market research ranked 2nd, 3rd, and 4th, respectively.
The next question we asked might provide some insights into why big ideas often don’t gain traction. Seventy-three percent of business respondents said that the hardest part of using data to drive innovation was finding reliable data. Seventy-two percent said accessing the right people for feedback was a roadblock.
The good news
So, where do we stand?
We feel good about the fact that people value innovation and investments that are focused on solving real problems. And, that companies recognize the importance of their customers’ voices — that’s the Feedback Economy in action.
We’re also glad that our data shows that any company can harness innovation to drive growth and find a competitive advantage. And, that innovation can be applied to everyday business challenges; from launching products to meeting sales goals or stopping employee attrition.
But, in all cases, the starting point is feedback. And luckily for most businesses, the answers might be found in the voices of customers, potential customers, employees, and partners, who are just waiting for someone to ask.