Marketing Innovation

Orsolya Sadik-Rozsnyai (rorsolya@yahoo.com)

Course Syllabus
DESCRIPTION:
This course provides an experienced-based approach to marketing innovation and its practical application Topics to be addressed and discussed from an applied point of view include : Innovation Typology, Creativity, Adopter categories, Market Studies This course is coordinated by Laurent Soldermann & Orsolya Sadik-Rozsnyai PERFORMANCE ASSESSMENT: Student performance will be assessed on criteria of class participation and the final innovation project

Planning

Session 1 LS Sept. 22/23

Project Launch Choice of Sector

Sustainable development trend sheet

Session 2 OSR Sep. 29/30

Creativity Session : Choice of Persona + New Product/Service Creation Modification and deepening of the concept, based on Interviews Preparation Concept Sheet I-P-RW

Session 3 LS Oct. 20/21

Demonstrator/ prototype

Session 5 LS Oct. 27/28

Result analysis & concept amendment Final consumer test + Presentation Preparation (1.st version) Presentation Preparation (final version)

Session 5 OSR Dc. 01/02

Theoretical Background of Innovation Creativity Session : Innovation launch campaign preparation

Session 6 OSR Dec. 08/09

Oral presentations 3

Planning

Session 1 LS Sept. 26

Project Launch Choice of Sector

Sustainable development trend sheet

Session 2 OSR-Oct. 3

Creativity Session : Choice of Persona + New Product/Secrvice Creation Modification and deepening of the concept, based on Interviews Preparation Concept Sheet I-P-RW

Session 3 LS Oct. 10

Demonstrator / Prototype

Session 4 LS W Oct. 24

Result analysis & concept amendment Final consumer test + Presentation Preparation (1.st version) Presentation Preparation (final version)

Session 5 OSR W Nov. 28

Theoretical Background of Innovation Creativity Session : Innovation launch campaign preparation

Session 6 OSR W Dec. 5

Oral presentations 4

Session 2 Creative Thinking

Program Session 2

20 minutes

The Theoretical basis of the Creative Thinking and Creativity Techniques

2.5 hours

Brain Post-it Choice of Persona + New Product/Service Creation

Innovation & Creativity

Innovation : Although the term is broadly used, innovation generally refers to the creation of better or more effective products, processes, technologies, or ideas that are accepted by markets, governments, and society Creativity : Creativity refers to the phenomenon whereby a person creates something new (a product, a solution, a work of art, a novel, a joke, etc.) that has some kind of value. Creativity techniques : Methods that encourage and reinforce creative actions, whether in the arts or sciences. They focus on a variety of aspects of creativity, including techniques for idea generation and divergent thinking, methods of re-framing problems and so on. Some techniques require groups of two or more people while other techniques can be accomplished alone.

Source : http://en.wikipedia.org

Creativity Techniques

Collectively, there are several hundred techniques published in books by creativity thinking experts
Techniques are like tools in a workshop, with different tools for different parts of the creative process. For example,

The Six Universal Questions

What? Where? When? How? Why? Who? Forced analogy : In order to generate ideas, the participants should compare the problem with something else that has little or nothing in common and gaining new insights as a result. You can force a relationship between almost anything, and get new insights : ex. companies and whales

Brainstorming Generating ideas in a group situation

Etc
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Creative Problem Solving 3 steps

Source : http://www.rogerfirestien.com/

Brainstorming
Brainstorming is a group creativity technique by which a group tries to find a solution for a specific problem by gathering a list of ideas spontaneously contributed by its members.
The term was popularized by Alex Faickney Osborn in 1953 through the book Applied Imagination (He was frustrated by employees inability to develop creative ideas individually for ad campaigns). In the book, Osborn not only proposed the brainstorming method but also established effective rules for hosting brainstorming sessions.

Source : http://en.wikipedia.org/wiki/Brainstorming

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4 rules of Osborn's brainstorming method

1. 2.

Focus on quantity : The assumption is that the greater the number of ideas generated, the greater the chance of producing a radical and effective solution. Withhold criticism: In brainstorming, criticism of ideas generated should be put 'on hold'. Instead, participants should focus on extending or adding to ideas, reserving criticism for a later 'critical stage' of the process. By suspending judgment, participants will feel free to generate unusual ideas. Welcome unusual ideas: To get a good and long list of ideas, unusual ideas are welcomed. They can be generated by looking from new perspectives and suspending assumptions. Combine and improve ideas: Good ideas may be combined to form a single better good idea, as suggested by the slogan "1+1=3".

3. 4.

Source : http://en.wikipedia.org/wiki/Brainstorming

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Brainstorming Process
1.Step : Divergent thinking Look at your images and generate ideas Generate as many ideas as rapidly as possible linked to your creative challenge : real ones, fun ones Stand around the flip chart, pen in hand As you think of an idea, write it down on a post-it. Try to write it with a subject and a verb Write one idea per post-it. Stick your post-its on the paper board 2. Step : Convergent thinking Look at your post-its collectively begin moving/clustering them into common or natural themes Characterizes each cluster by a word or two Vote for best ideas by writing a circle (2 votes for each member) Choose together the best idea 3 . Step : Concept sheet Prepare your concept sheet Prepare the marketing mix

No matter how daft, how impossible or how silly an idea is, it must be written down ! Laughing is to be encouraged. Criticism is not !

The Osborn-Parnes creative problem solving technique

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Persona poster
In marketing and user-centered design, personas are fictional characters created to represent the different user types, based on real data and information It is an artifact that consists of a narrative relating relates to a desired users daily behavior patterns and lifestyle, using specific details, not generalities. Personas allow designers to understand the target demographic better than lists of data. Its just like having a real user included in every step of the design process. This leads to a much more realistic user understanding. The concept was developed in 1993 Angus Jenkinson and internationally adopted by OgilvyOne with clients using the name CustomerPrints as "day-inthe-life archetype descriptions"

Source : rwhitespace.com

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Using Personas & Scenarios in design

In goal-oriented web design, the designer plays through a full set of usage scenarios for each persona. A scenario is a complete journey from first point of contact with the system, right through to a goal being achieved Its also possible to create a disaster scenario of a Persona, a bad day experience, to stimulate creativity based on imaginative guesswork

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Brain Post-it : Step by Step

1. Create your Persona
1h10 20 min

6. Develop it

5. Choose the best idea(s)

2. Describe a bad day scenario of your Persona

15 min

4. Bring together linked ideas

2.b Create a video with your Smartphone (1-2minutes)

10 min

20 min

3. Generate ideas to create a new innovative product or service for your Persona which fits to the sustainable development trend
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Not in class

Ice Breaker Creativity Exercise: Describe Gabrielle Solis Monday !

This morning, Gabrielle woke up in a good mood. She has planned a day of shopping. But when she was taking his breakfast, someone knocked at the door

Continue the story ! Stay Foolish !

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Session 5 Innovation

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Program Session 5

1 hour

The Theoretical basis of the Innovation

1.5 hours

Project Finalization : 4P Oral presentation Preparation

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Definition
Innovation : a new idea applied successfully in practice
Schumpeter (1934) distinguishes : The introduction of a new good The introduction of a new method of production, The opening of a new market, The conquest of a new source of supply of raw materials or half-manufactured goods The carrying out of the new organization of any industry

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The most innovative companies

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Source : Fast Company.

Innovation categories By the origin

Supply-pushed innovations
Based on new technological possibilities

Demand-led innovations
Based on social needs and market requirements

iPhone Touch Screen

Coca-Cola Vanilla Zero

Arena Powerskin

Customized Citron DS3

Internet Key

Organic skin care

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Innovations categories by level of novelty

Radical innovations
Plan cours Projet inno Dfinition Typologie Dveloppmnt. Outils tudes de cas Stratgie Prix

Incremental innovations
Weak technological evolution

Revolutionary technological changes

Consumer behavior changes

Progressive improvement of the product

3D TV

iPod shuffle Web

Samsung Galaxy S2 Smartphone

Toyota Prius Hybride

iPad
Source : Badot O., Cova B. (1992), Le No-Marketing, ESF diteur, Paris

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Innovations categories
Product innovation
Creation and introduction of a good that is either new, or improved

Service innovation
New or significantly improved service concept that is taken into practice

delivers quality brands at up to 70% off retail through online sales events every day

Amazon Kindle Fire

Samsung NaviBot Robotic Vacuum Cleaner

Sonys European Online Store

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Innovations categories
Process Innovation
A change in the way a product or service is manufactured, created, or distributed

Business model Innovation

A new way to generate profit

Tata Nano ($2300) city car Online stores

Eco Friendly Packaging Products

ITunes store + iPod

Digital photos

Low-cost airlines

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Sources of innovation
Research and Development (radical innovations) Market surveys (incremental innovations)

End User* (user innovations)

Linux : free and open source software

*Source : Eric Van Hippel The Sources of Innovation (1988)

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Including customers in the Innovation Process

Source : Product Conceptualisation with the Lead User Method - Professor Erkko Autio (adapted from a web presentation by Professor Eric von Hippel, MIT Sloan School of Management)/ http://www.entrepreneur.dk/DTU%20kandidat%202007/Slides/Microsoft%20PowerPoint%2026 %20Lead%20User%20method%20brief.pdf

Innovation adoption process 5 Stages of Rogers

Knowledge
In this stage the individual is first exposed to an innovation but lacks information about the innovation. During this stage of the process the individual has not been inspired to find more information about the innovation.

Persuasion
In this stage the individual is interested in the innovation and actively seeks information/detail about the innovation.

Decision
In this stage the individual takes the concept of the innovation and weighs the advantages/disadvan tages of using the innovation and decides whether to adopt or reject the innovation.

Implementation
In this stage the individual employs the innovation to a varying degree depending on the situation. During this stage the individual determines the usefulness of the innovation and may search for further information about it.

Confirmation
The individual finalizes their decision to continue using the innovation and may use the innovation to its fullest potential.

Source : E. Rogers, Diffusion of Innovations, 1962

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Adopter categories

Adopter category : a classification of individuals within a social system on the basis of innovativeness Innovators The first individuals to adopt an innovation Willing to take risks, youngest in age, highest social class, have great financial lucidity, Very social and have closest contact to scientific sources and interaction with other innovators. Early Adopters Have the highest degree of opinion leadership among the other adopter categories. Are younger in age, have a higher social status, have more financial lucidity, advanced education , and are more socially forward than late adopters. Realize judicious choice of adoption will help them maintain central communication position

Source : E. Rogers, Diffusion of Innovations, 1962

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Adopter categories
Early Majority Individuals in this category adopt an innovation after a varying degree of time. This time of adoption is significantly longer than the innovators and early adopters. Have above average social status, contact with early adopters, and seldom hold positions of opinion leadership in a system
Late Majority Individuals in this category will adopt an innovation after the average member of the society. Skeptical about an innovation, have below average social status, very little financial lucidity Laggards Individuals in this category are the last to adopt an innovation. Aversion to change-agents, advanced in age, focused on traditions, lowest social status, lowest financial fluidity, oldest of all other adopters

Source : E. Rogers, Diffusion of Innovations, 1962

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Innovation Success Stories

Customer value perception Strong communication Design Consumer trends Wow effect create emotions (surprised by something wonderful or really great)

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Innovation failures
Marketing positioning error EuroDisney initial launch error : High prices without special offers and packages Too advanced product / concept 1998 launch of the Smart City-Coup by Mercedes-Benz and Swatch Market saturation Smart Forfour launched in the saturated market of B-segment small cars Not real value perceived by customers Danone Essensis - The Beauty Yogurt it contained probiotic strains, antioxidants from green tea, omega 6 fatty acids from borage oil and vitamin E and promised a healthier looking skin when using the product daily for one month

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Innovation process
The basic innovation process consists of 4 steps:
1.Search and idea generation Generate ideas and produce a supply of opportunities 2. Assess Evaluation of the many ideas generated Put ideas through an objective filter in order to ascertain which ideas hold the most potential 3. Develop Refining the ideas from concept to working reality Prepare the ideas with potential through a process that readies them for implementation 4. Implement Making the ideas happen for real Pursue opportunities (using familiar project management tools)

Source :http://www.tranxend.co.za/innovation.html

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Open Innovation
= Integrating external ideas throughout the Innovation Process Open innovation is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology

Source : Chesbrough, H.W. (2003). Open Innovation: The new imperative for creating and profiting from technology. Boston: 33 Harvard Business School Press, p. xxiv

Open Innovation Network

Laboratories

Startups
Suppliers Universities

Source : http://www.icio.com/__data/assets/image/0017/7082/DAIMLER.jpg

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Open Innovation with customers : Lead User Method

Lead user is a term developed by Eric von Hippel in 1986.
His definition for lead user is: Lead users face needs that will be general in a marketplace but face them months or years before the bulk of that marketplace encounters them, and Lead users are positioned to benefit significantly by obtaining a solution to those needs. They are at the leading edge of important market trends and Lead users often have to develop the new products and services they need for themselves - they become user-innovators

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Open Innovation Example of Lead User

In 2011, Apple hired prolific jailbreak hacker Nicholas Allegra, aka Comex.
He is well known for his work on the web based jailbreak tool JailbreakMe. He was also the first person to publish a jailbreak for the iPad 2 Comexs hacking abilities have been compared to that of high-level cyber criminal that attacks government infrastructures. Being responsible for Apple releasing new versions of iOS to patch his exploits, many believed that Comex was hired by Apple to work on patching security vulnerabilities from the inside.

Source : http://www.iphone-my.com/news/apple-hire-jailbreak-hacker-comex-embarrassment/

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Open Innovation Example of Lead User

37 Source : Professor Erkko Autio (adapted from a web presentation by Professor Eric von Hippel, MIT Sloan School of Management)/

Open Innovation Example of Lead User

Source : Professor Erkko Autio (adapted from a web presentation by Professor Eric von Hippel, MIT Sloan School of Management)/

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Open Innovation Sources of Innovations

Source : Professor Erkko Autio (adapted from a web presentation by Professor Eric von Hippel, MIT Sloan School of Management)/

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Open Innovation

Source : Professor Erkko Autio (adapted from a web presentation by Professor Eric von Hippel, MIT Sloan School of Management)/

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Open Innovation IBM Innovation Jam

Since 2001, IBM the multinational has been holding innovation jams, where thousands of employees brainstorm ideas over a period of a few days. The first jam was an experiment that proved to the company the power of its Intranet to serve as a single collaborative space for the company. It was a way of making use of the collective smarts of 350,000 people and using this as an asset to improve the way the organization operates. IBM uses open innovation jams extensively and in 2006 it embarked on its largest ever online brainstorming session to speed up the launch of new technologies and develop novel ways of bringing them to market. Prompted by IBM Chairman and Chief Executive Officer Samuel J. Palmisano this was the first jam where IBM involved individuals and research organizations who were not part of the company.

Source : Professor Erkko Autio (adapted from a web presentation by Professor Eric von Hippel, MIT Sloan School of Management)/

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Open Innovation IBM Innovation Jam

42 Source : http://sloanreview.mit.edu/files/2008/12/50101-si2-lo6.png

Open Innovation IBM Innovation Jam

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Open Innovation Volkswagen Open Innovation Contest

German automaker Volkswagen organizes, every year, an open innovation contest.

In 2010, it called "App My Ride and Volkswagen invited designers, programmers, developers and interested users to help develop applications for the Infotainment systems of the future.

A jury of experts selected a winner and award prizes, including a placement for students within Volkswagen Group Research in Tokyo, Shanghai, California or Wolfsburg.
"Our aim is to invite the international developer community to take part in designing a future system," (VW Group Research Chief Prof. Dr Jrgen Leohold)

Source : http://www.worldcarfans.com/110042625857/vw-announces-open-innovation-contest-app-my-ride#ixzz1XBaMYs7D 44

Open Innovation VOLKSWAGEN AQUA

Dense traffic in China has inspired Zhang Yuhan, a Female Chinese design student to create a multifunction vehicles using the Volkswagen brand in June 2011. Its a cross between a modern car, a boat, an ultra-cool theme park ride and a spaceship. The Volkswagen Aqua Concept hovercraft is designed to be an effective mode of transportation for Chinese commuters, capable of getting a driver and passenger through and over heavy snowfalls, lakes, rivers and just about any terrain that gets thrown at it

Source : http://www.oamahou.com/design/volkswagen-aqua-by-yuhan-zhang.html?lang=en

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Books

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Brain Post-it session

Creative Challenge : Imagine a creative launch campaign for your innovation Creative Technique : Forced connections & The Six Universal Questions
Forced connections Definition The brainstorm technique known as forced connections is designed to take two unrelated concepts and forge a relationship between them. Ideal Activity For branding, concept generation, event planning How To Brainstorm With Forced Connections pick one topic create a connection between the topic and the creative challenge if a group is still struggling to create a connection between the words theyve drawn, it can draw a new word record your thoughts on a post it regroup post-its choose the best one

The Six Universal Questions What? Where? When? How? Why? Who?
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Brain Post-it : Step by Step

6. Create your event scenario by using 6 Universal Questions

1. Display your innovation and Persona

2. Pick a topic
5. Choose the best idea(s)

4. Bring together linked ideas

3. Generate ideas/words by associating your innovation and the topic. Write down your words on post-its. Rebound on others words!
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EVENT SCHEDULE PLANNER

What?

Where ?

When ?

Who ?

Why ?

How ?

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Forced Connections Topics

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Forced Connections Topics

Baby Red Brown Breakfast Morning Bottle art bear boat bread age atom beauty body break Toddler Orange Pink Snack Evening Air baby bell bone brother anger back bird book call Lunch Dinner Sun animal ball block bottom camp
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Child Yellow

Adolescent Green Blue

Adult

Retired Indigo Violet Black White

Supper Rain answer band blood Box capital

Snack Fork apple bank blow boy Computer area bar board branch arm bas