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100 Proven and Actionable Innovation Tactics for 2021: Which will you use?
There is so much hype around innovation and yet not many really understand what it is and what it can do for a business. Many will think of industry disruptors such as Netflix, Amazon and Tesla whilst others think innovation is about a random process where people get together to brainstorm wild and extravagant ideas.
You don’t have to reinvent the wheel to innovate in your business. The good news is that most innovations have been ‘invented’. Here is your guide to 100 actionable and proven innovation tactics you too can use to grow your business.
How is innovation relevant to building a website?
Investigating a building a new website or upgrading an existing one can be the trigger to re-evaluate your business strategy, including your business model, how you do business, how you interact with your customers, how you get paid, and how you can streamline your systems. It opens the door to new possibilities, new ways of doing business. It is about leveraging technology capabilities to make your business stronger, more efficient and more profitable. It is an opportunity to revise your business strategy and business model so that you build a website that supports your overall business goals and ambitions.
Business innovation is NOT what you think
For most people, business innovation is about product innovation – whether it is a new product, an improved product or the addition of a new feature to an existing product. While product innovation is a type of innovation, it is the easiest innovation for competitors to copy and the one that offers the lowest return on investment (ROI).
Innovation experts, led by Larry Keeley, define in their book Ten Types of Innovation innovation as “the creation of a viable new offering”. As such, you can innovate by introducing new products, new ways of doing business, new ways of making money and new interactions and forms of engagement with your customers.
You don’t have to reinvent the wheel to innovate in your business. You just have to look at what your competitors are doing and how other industries are innovating. This will give you ideas on how to leverage those innovations in your business. The good news is that most innovations have been ‘invented’ and you’ll find those listed below with examples.
We’d like to acknowledge the authoring team behind Ten Types of Innovation for codifying, structuring three decades of consulting work into an innovation framework that anyone can use.
Why innovate?
We all know what happened to Blockbuster Entertainment, Borders and Toys R Us, don’t we? They failed to innovate, and as a result, died.
These companies were hugely successful and that success made them complacent. Hugely successful companies sometimes find it difficult to innovate because innovation requires for them to break the status quo, disrupt their hugely profitable business model. As the world around them changed and the internet became widely available, they somehow believed their business model was still relevant and that change was not necessary.
As a result, competitors like Netflix and Amazon emerged with an innovative business model taking advantage of technological advances. They soared and left the “old guard’ for dead.
The ability to innovate – to evolve, adapt and improve – is imperative. Companies must innovate in order to survive and thrive. Nothing lasts forever.
The arrogance of success is to think that what we did yesterday will be sufficient for tomorrow.
William Pollard
American Physicist and episcopal priest
The 10 types of innovation – and 100 tactics – you too can use
Larry Keeley and a team of innovation experts demystified, classified and codified innovation. They used over 30 years of work and over 2,000 examples of successful innovations to categorise 10 types of business innovations and listed over 100 innovation tactics which you can use to introduce tried and tested innovation initiatives to help you make a real impact in your business. They’ve done all the hard work for you!
The 10 types of innovations fall into three groups:
-Those that focus on the internal workings of a business and its business system, including the profit model, network, structure and process
-Those that focus on a business’ core product/s or service/s, including product performance and product system.
-Those that focus on the customer experience including service, channel, brand and customer engagement.
1. The Profit Model Shift: Change the way your business makes money
Profit model innovation impacts ‘what’ you offer, what to charge, or how to collect revenues.
Example: Rolls-Royce, a British luxury care and aero engine manufacturer, achieved success in the 1980’s with its “power-by-the-hour” model of its aircraft engines.
Result: The customer did not purchase the engine but instead was billed for every hour the engine was used. Rolls Royce kept ownership and maintenance obligations.
21 Innovation Tactics
Ad-supported
Auction
Bundled pricing
Cost leadership
Disaggregated pricing (allow customers to buy exactly and only what they want)
Financing
Flexible pricing (based on demand)
Float (Get payment before building a product to earn interest revenue)
Forced scarcity
Freemium
Installed base (core product offered at near breakeven, make money on additional products)
Licensing
Membership
Metered use
Microtransactions
Premium
Risk sharing (waive fees if metrics not achieved, get bonus if metrics achieved)
Scaled transactions (high volume sales for relatively fixed unit costs)
Subscriptions
Switchboard (connect multiple buyers with multiple sellers)
User-defined (invite users to set the price they want to pay)
2. Network Innovation: How you connect with others to create value
This is when you can take advantage of other companies’ processes, technologies, offerings, channels and brands to deliver your value in a cheaper, faster and more profitable way.
Example: Ford and Volkswagen, two car competitors, entered into a partnership to develop technology for self-driving vehicles. Ford brought advanced automated driving technology whilst Volkswagen was leading in electric technology for vehicles.
Result: This allowed both companies to spread the cost of R&D whilst developing competing products.
10 Network Innovation Tactics
Alliances
Collaboration
Complementary partnering
Consolidation
Competition
Franchising
Merger/Acquisition
Open Innovation
Secondary markets
Supply chain integration
3. Structure Innovation: How you organise and align your talent and assets
This is when you can take advantage of other companies’ processes, technologies, offerings, channels and brands to deliver your value in a cheaper, faster and more profitable way.
Example: WeWork’s business model is about providing affordable office rentals by offering co-working spaces. In order to rapidly deploy new working spaces, WeWork started using a system called rental arbitrage, where they rented commercial space, create a ready-to-use coworking space, and then rent this space to customers. By not having to spend CAPEX on purchasing the buildings themselves, they were able to rapidly expand with lower overhead.
Result: WeWork were able to rapidly expand without having to spend big capital on buying the buildings.
9 Structure Innovation Tactics
Asset Standardisation
Competency center
Corporate university
Decentralised management
Incentive systems
IT integration
Knowledge management
Organisational design
Outsourcing
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4. Process Innovation: How you use signature or superior methods to do your work
This often refers to the business’ core competency. It may include patented or proprietary processes that create a long lasting competitive advantage. It is the “special sauce” your competitors can’t replicate.
Example: AliExpress – Making everyone a Shop Owner: AliExpress is one of the world’s largest eCommerce sites, and serves as a commercial storefront for thousands of Chinese companies, allowing you to purchase everything to phone cases to forklifts and allowing you to use a system called drop-shipping.
Result: Anyone can set up their own store, sell someone else’s products (but to customers it looks like they are coming from the seller) and then have those manufacturers send the product directly to the customer.
13 Process Innovation Tactics
Crowdsourcing
Flexible manufacturing
Intellectual property
Lean production
Localisation (target a specific culture or region)
Logistics systems
On-demand production
Predictive analysis
Process automation
Process efficiency
Process standardisation
Strategic design (consistent across offerings, brands and experience)
User-generated
5. Product Performance Innovation: How you develop new features and functionality
As it has been mentioned earlier, this type of innovation is commonly believed to be the be all and end all of innovation. It’s certainly important, but it is often the easiest innovation for competitors to copy. Still it can drive growth incrementally. You can look at simplification to make it easy for customers to use your products, or sustainability and introduce new products that do no harm to the planet.
Example: Lush Cosmetics – Removing what people don’t want anymore. Lush, a British-based firm prides itself on its handmade products and ethical supply chain. It was an early pioneer in bringing packaging-free cosmetics to scale, offering some dedicated packaging-free stores.
Result: Environment conscious customers can buy beauty products without the guilt of buying products with unecessary plastic packaging which will end up in landfill or the ocean.
12 Product Performance Innovation Tactics
Added functionality
Conservation
Customisation
Ease of use
Engaging functionality
Environmental sensitivity
Feature aggregation
Focus
Performance simplification
Safety
Styling
Superior product
6. Product System Innovation: How you create complementary products and services
Product System Innovations help you build product ecosystems that can be scaled easily. Product bundling is used by technology companies to build platforms (including app stores, developer kits and APIs) that motivates others to develop products and services for them. Other Product System Innovations include product extensions, product and service combinations and complementary offerings.
Example: Zapier – making software applications talk to each other easily. We thought we’d use Zapier as an example here as we use this software for our own business and our clients’. It makes integrating popular software applications a breeze. No need of a developer to create automation rules. Zapier acts the middleman for data and uses a subscription model which can be scaled up.
Result: Zapier is allowing anyone in business to create automation rules that make business easier and simpler to manage.
6 Product System Innovation Tactics
Complements
Extensions/plugins
Integrated offering
Modular systems
Product bundling
Product/Service Platforms
7. Service Innovation: How you support and amplify the value of your offerings
Service Innovations focuses on the customer experience and loyalty. They make a product easier to try, use and enjoy; and they fix problems and smooth over the rough spots in the customer journey. They can elevate a bland product into a compelling experience that your customer will want to experience again and again.
Increasingly, this type of innovation is delivered through electronic interfaces, remote communications, and automated technologies.
Example: Meituan Dianping – Yoga classes. Movie tickets. Haircuts. Hot pots. Babysitting. Coupons. Think of all the errands and activities you do every day. Meituan-Dianping’s online platform sells enormous amount of services, connecting consumers and merchants. It’s the Amazon of services in China, and much more.
Result: Known as a transactional super-app, you can use the app to book and pay for food delivery, travel, movie tickets and more from millions Chinese small and large merchants. Meituan revenues up 121% in Q1 2021, reaching 569 million paying users.
12 Service Innovations Tactics
Added value
Concierge (take on tasks for which customers don’t have time)
Guarantee
Lease or Loan
Loyalty programs
Personalised service
Self-service
Superior service
Supplementary service
Total experience management
Try before you buy
User communities/support systems
Your website is the engine that drives your digital marketing and business growth.
Sylvie Danoy
POPconsultica
8. Channel Innovation: How you deliver your offerings to customers and users
The goal here is to ensure that your customers can buy what they want, when and how they want it, with minimal friction and cost.
While e-commerce has emerged as a dominant force, brick and mortar stores focus is shifting to create immersive experiences that delight their customers. Flagship and pop-up shops are examples of channel innovations and so are indirect distribution and multi-level marketing.
Example: Dollar Shave Club – Direct to your door: Razor Blades have always been high-margin products, and Gillette was one of the original business model innovators by giving away the razor handle to make money on the blades sales. Dollar Shave Club, on the other hand, has focused on a subscription model whereby it reduced the cost of the blades and had people join a subscription service where blades are delivered to them automatically.
Result: The Dollar Shave Club has enhanced the customer experience by providing convenience at no extra cost to its customers and the subscription model has provided steady, predictable revenue for the company, to the extend that subscription boxes can now be found for almost any consumable product.
11 Channel Innovation Tactics
Context specific
Cross-selling
Diversification
Experience centre
Flagship store
Go direct
Indirect distribution (using resellers)
Multi-level marketing
Non-traditional channels
On-demand
Pop-up presence
9. Brand Innovation: How you represent your offerings and business
The goal here is to transform commodities into prized products, and give meaning, intent and value to what you offer and your business.
They are usually carefully crafted strategies that are implemented across many touchpoints between your company and your customers, including communications, advertising, service interactions, channel environments, and employee and business partner conduct.
Example: Burberry – modernising a classic brand: In the 2000s, the brand became inextricably linked with “chav culture”, a pejorative stereotype of the British working class that sent sales plummeting. Burberry had been a brand for the country aristocrat; inextricably tied with genteel pursuits.
When Burberry decided to turn things around, they capitalized on their history to rebrand—and tell a new brand story—as a fashion-forward, upscale and glamorous brand that epitomized contemporary Britain.
Burberry aggressively into the digital space at a time when many design houses saw elaborate websites as liabilities. This sparked digital innovation. Burberry embraced social media, livestreaming of fashion shows and digital engagement with consumers. Burberry even redesigned its Regent street store to reflect the burberry.com website, providing a seamless experience from digital to retail.
Result: The brand now, in the minds of consumers, means British, plaid – and innovation.
8 Brand Innovation Tactics
Brand extension (new product/service under the umbrella of an existing brand)
Brand leverage (allow others to use your brand name to lend them your credibility and extend your company’s reach)
Certification
Co-branding
Component branding
Private label
Transparency
Values alignment
10. Customer Engagement Innovation: How you foster compelling interactions
Customer Engagemnet innovations are all about understanding the deep-seated aspirations of customers and using those insights to develop meaningful connections between them and your business.
Increasingly these innovations take place in the social media space, as many companies move away from “broadcast” communications towards delivering more organic, authentic and mutual interactions.
Example: Peloton – bringing the gym into the home: Many people benefit from going to joint gym classes because the sense of a group working toward is goals together with a coach is more powerful than trying to exercise by yourself. Peloton makes exercise equipment with built-in screens, powered by a subscription to live and on-demand classes.
Result: It’s like being part of a workout group with the benefits of being at home.
10 Customer Engagement Innovation Tactics
Autonomy and authority (grant users the power to shape their own experience)
Community and belonging (get your customers to feel part of a group or movement)
Curation
Experience automation
Experience enabling
Experience simplification
Mastery
Personalisation
Status and recognition
Whimsy and personality
Innovation Resources
Ten Types of Innovation: The Discipline of Building Breakthroughs by Larry Keeley, Helen Walters, Ryan Pikkel, Brian Quinn
The Ten Types of Innovation explores these insights to diagnose patterns of innovation within industries, to identify innovation opportunities, and to evaluate how firms are performing against competitors. The framework has proven to be one of the most enduring and useful ways to start thinking about transformation.
Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers By: Alexander Osterwalder, Yves Peigner
Defy outmoded business models and design tomorrow’s enterprises. Co-created by 470 “Business Model Canvas” practitioners from 45 countries, It explains the most common Business Model patterns, based on concepts from leading business thinkers, and helps you reinterpret them for your own context. features practical innovation techniques used today by leading consultants and companies worldwide, including 3M, Ericsson, Capgemini, Deloitte, and others.
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