Some 51% of high-level executives at media and marketing organizations agree that their top-selling product in 2017 has yet to be invented, finds Econsultancy [download page] in a new study produced in partnership with Jordan Edmiston (JEGI). Notably, B2B respondents share that sentiment to almost the same degree as B2C companies. So where do new product ideas come from, and what spells doom for them?
According to the study, a leading 80% of the respondents indicate that new product ideas originate from senior management, a fairly unsurprising result. More importantly, perhaps, is that these companies are also listening to their customers: some 72% say that new product ideas come from customer requests. That’s significant given recent research showing that not only can brands gather ideas from consumers, but doing so can help foster stronger connections with those consumers, too. Moreover, an earlier report found that organizations that structure their innovation processes by combining internal teams with customer input report higher satisfaction with a variety of innovation areas than companies not employing that structure.
The topic of innovation has become more prominent of late, particularly in the media and entertainment sector, where executives believe that the creation of a culture of innovation will be a top strategic priority guiding their transformation to digital-oriented companies. Innovation may be more important to brands than customers in some sectors, though: a recent McKinsey report indicated that B2B core messaging that identifies the brand as “a driver of innovation” has little to no contribution to perceived brand strength.
Returning to the Econsultancy/JEGI report, the survey results indicate that sales and marketing teams are highly involved in delivering new product ideas, with 62% of respondents reporting new ideas from those teams. That aligns with research indicating a strong presence for marketing in particular in bringing new products to market.
Beyond those top-3 sources of new product ideas (management, customers, sales/marketing), the Econsultancy report also shows that a majority of respondents get ideas from competitors and market dynamics. The analysts note that this is becoming more important in the digital age, where “first-mover advantage is fleeing in digital product cycles, and it often means working out (and displaying) the kinds in a product or system.” In other words, there’s room for the “second generation to take advantage.”
Meanwhile, only about 3 in 10 companies source ideas from a defined innovation program.
So what “derails” new products? Most commonly, respondents cited unreasonable expectations early in the development cycle (53%), with this problem more acute among B2C companies (61%). Interestingly, the second-most cited issue is insufficient investment in user experience (44%).
Overall, some 71% of respondents to the survey said that launching new products and services will be a top growth driver over the next 12-24 months. That made innovation the leading perceived growth driver among the options listed.
About the Data: The 2014 Media Growth Report is based on a two-phased approach, beginning with a survey conducted by Econsultancy in September 2013. That survey was fielded to top executives at a diverse array of businesses of all sizes across the media, information, marketing and technology sectors. Over 81% of respondents are chief executives, chairmen, or presidents at the organizations from which they are responding.
Respondent organizations are primarily based in North America, although Western Europe and specifically the United Kingdom are also significantly represented.
From the 339 total respondents to the survey, phase two was launched ”“ invitations to a targeted group of industry veterans and innovators to participate in qualitative interviews, to elaborate on their answers and provide context to the data.