Innovation of Business

and the
Business of Innovation™
 
Marketing Disciplines in Innovation

A Key Source of Innovation Toolkits

Innovation is a powerful concept, yet it stands on the shoulders of other disciplines.  Just to develop ideas into prototypes worthy of evaluation, we need creativity, science, engineering, design, and testing.  Management of new product development includes disciplines for management of pipelines, platforms, portfolios, processes, and projects.


When we refer to “innovating” a business or a product, however, we are actually talking about marketing.  Not marketing as advertising, but marketing as both strategy and toolkit for defining, designing, branding, developing, and launching businesses and products.


Marketing

Many organizations equate marketing with communications:  websites, brochures, advertising, PR, and trade shows.  That limited view creates disadvantage as bad as going into a boxing match with blinders on and one hand tied behind our back.  Consider this definition of marketing.
Marketing:  The science of making and keeping satisfied stakeholders, at a profit, over time, in a competitive environment
Note first that marketing is very strategic.  Satisfaction, revenues, and competition involve whole businesses and most functions within businesses.  Marketing is not a side issue, but a best-in-class way of doing business – a core competency essential at every stage. 

Second, marketing is a leadership function – the science of creating durable visions, building consensus, and initiating change at business and product levels.  In a world of increasing complexity, leadership requires a much broader view than, say, technology or finance. 

Third, marketing is an ongoing resource and influence over time.  To match up to its definition, marketing begins early in any innovation cycle and continues through monitoring of post-launch market impact.

Fourth, marketing is a science, not an art form.  Marketing is a suite of logical, manageable, repeatable processes.  With appropriate tools, good marketing can be engineered just like good technology.  Indeed, marketing is a natural extension of the perspectives and skills of every type of technical professional, including legal and management.

Fifth, everything in our definition changes, both directly and in response to the forces of economics, politics, technology, cultures, and globalization.  Marketing provides structure and methods for gathering and absorbing information, making decisions, developing buy-in, and taking action.

Sixth, marketing applies to all exchange relationships.  Even R&D scientists must gain funding to support new work.  Marketing applies as much to alliance and distributor relationships as to investors and customers.  We all do marketing every day, though few of us do it well. 

Finally, marketing is a mindset – a powerful way of looking at the world that puts customers and other stakeholders at the center.  Marketing recognizes that the best way to create wealth is to satisfy those relationship partners so well that they gladly invest and come back for more. 

In comparison, innovation is development of ideas into businesses in operation and products in use, for the first time anywhere, that create compelling value for customers.  Innovation is creation of sustainable change.  Innovation is invention plus commercialization.  As defined here, marketing brings a strong customer-centric attitude and knowledge base to innovation. 

Marketing Disciplines

Successful innovation creates return on investment through customer satisfaction.  Business innovation takes the sum of conception, development, and operation.  Product innovation requires invention, productization, and commercialization.  Innovation is development of ideas into businesses in operation and products in use. 

Sadly, many don’t recognize or use such tools.  I know first hand.  I once lost a marvelous INC 500 software company because I didn’t understand the importance of marketing to the success of innovation.  We did tactical marketing so well that we won awards.  We lost the company for lack of strategic and product marketing.

Take the time to conceive of the breadth of marketing disciplines, and please note the connections to innovation.
Strategic Marketing:  The corporate compass.  Leadership processes for ensuring corporate profitability through integrated decisions and actions, centered on stakeholders, that impact the identity, brand, design, development, operation, culture, branding, tactical marketing, launch, and funding of companies, businesses, and core business functions. 

Strategic marketing initiates and directs business innovation.

Product Marketing:  The value center.  Leadership processes for ensuring high return on investment in innovation through integrated decisions and actions, centered on stakeholders, that impact the identity, brand, design, development, pricing, distribution, branding, tactical marketing, market launch, and sales of products.  “Product” here is understood to include at least:  idea, technology, research result, service, process, tool, strategy, facility, and business model. 

Product marketing initiates and directs product innovation.

Opportunity Marketing:  The resource.  Leadership processes for defining, designing, branding, and developing opportunities, then persuading investors, funding sources, collaborators, allies, and licensees to commit resources via win-win agreements.  (Opportunities are unfinished businesses or products that need the support of stakeholders other than end users.)

Opportunity marketing is strategic or product marketing with a focus on selling potential rather than existing results. Applications include venture capital for new businesses, funding for R&D projects, responding to requests for proposals, and licensing technologies for transfer.  Opportunity marketing enables innovation.

Tactical Marketing:  The mouthpiece.  The integration of creative, design, and distribution processes for conveying persuasive messages, images, and brands to customers, investors, and other stakeholders through verbal, written, electronic, and event communications.  Disciplines include advertising, brochure/literature development, direct mail / e-mail, event management, presentation management, public/media relations, trade-show management, and website development.

Tactical marketing is innovation of communications and communication campaigns.

Internal MarketingThe buy-in. Tactical marketing applied within an organization to develop practical and emotional support for proposals and change initiatives. 

Market ResearchThe source. Both investigative processes for and results of discovering essential information about current status and future trends of markets and market forces in order to enable strategic and tactical business decisions.

SalesThe top line. A suite of processes for convincing potential customers to exchange money for products via win-win agreements.  Also, the results of executing the processes.
Note:  Tactical marketing and sales are quite expensive.  Strategic and product marketing, though relatively low cost, define the brands and core messages that power marketing communications and sales programs. 

Marketing creates visions and sets stakeholder-centered requirements for implementation of both businesses and products.  Marketing turns inventions into products, then moves products into markets.  Marketing makes and keeps satisfied stakeholders by delivering valuable results over time.

Marketing Tools for Innovation

Innovation takes a business.  Innovation takes knowledge, strategy, resources, facilities, expertise, and experience, all integrated into processes.  Many of the best innovation processes are actually marketing tools.  Take a look.
Business level:  Strategic identity analysis (visioning), integrated strategy analysis, brand definition, market segmentation, market research (forecasting, roadmapping, needs analysis, competitive analysis, price-point analysis), strategic culture analysis, buy-in campaigns for change initiatives, core-message definition, business launch.

Product level:  Concept analysis (evaluating), strategic identity analysis (visioning), integrated strategy analysis, brand definition, market segmentation, market research (as noted above), requirements analysis, project proposals, funding justification, core-message definition, product branding, product launch, post-launch market research (customer satisfaction, competitive impact).

Market level:  Market segmentation, customer description, lead generation, market research (as noted above), economic analysis, investment justification, strategic market directions, competitive strategies.

Communications level:  Branding and re-branding, positioning and repositioning, formal business and product launches.  Marketing communications:  advertising, brochure/literature development, direct mail / e-mail, event management, presentation management, public/media relations, trade-show management, and website development.

Innovation depends on marketing.  In many ways, innovation is marketing.  Marketing needs the ideas and prototypes of invention and R&D.  Neither is complete without the other.  The sum requires other business functions to complete a business capable of profits in today’s complex environment.

Marketing is clearly the optimum paradigm for leading and managing innovation of businesses and products.  Look at the definition again:  The science of making and keeping satisfied customers, at a profit, over time, in a competitive environment.  This definition defines all of business.  Marketing is that close to the core of every organization that serves customers.

At paradigm level, marketing outperforms technology, finance, manufacturing, and/or sales as starting place for any level of innovation.  Why?  Because marketing is a better way to perceive and approach markets.  Customer satisfaction and a focus on value guide both business and product development, then produce the revenues managed by finance.

Marketing isn’t an option in any practical sense.  We all do marketing every day, whether we know it or not.  Yet marketing is an option at the mindset level.  The choice of a marketing perspective delivers a more useful picture of markets, customers, competitors, and our interactions with them.  We can’t innovate without marketing, so we need to understand and leverage the power of marketing every day.

The time for change is now, and it always will be.
 


 

2. The milk of disruptive innovation doesn't flow from cash-cows. (David Isenberg)

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