The Ultimate Guide To Product Innovation

Production innovation is at the forefront of business success.

It drives customer retention, talent acquisition, expansion and industry competition. It is also a term that is used liberally, with a growing disconnect between product innovation and what it actually means for you and your business.

In this blog post we will provide the ultimate guide to product innovation, addressing all of your popular questions, such as “what does innovative mean?” and “what is an example of product innovation?”. We have provided the links below in case you already have a burning question in mind, making it easy to navigate our thorough guide to product innovation:

While our guide is detailed, it is not exhaustive. If you would like answers to specific queries, to understand exactly how innovation pertains to your individual business, it could be useful for you to seek guidance from a specialist product innovation consultant, or to conduct technical, academic research using the Journal of Product Innovation Management.

Define Innovative

Being innovative, or having innovation, is the process of introducing new ideas. It means that you are original, creative and advanced, and that these qualities are reflected in your work. It is a hugely valuable attribute to have, for both individuals and businesses, as it allows you to pave the way in your industry, adapting to and thriving in almost every situation.

Good innovation aids productivity, planning and strategy in all industries- especially the marketplace, where product innovation impacts profit, brand equity and development.

What Is Product Innovation?

Product innovation is the development and introduction of a product or service into the consumer marketplace. The product or service will address a gap in the market, provide a solution to a previously unaddressed problem, or improve something which already exists. There are two main kinds of product innovation:

Radical innovation refers to the development of a new product or service for a new market. It will typically have a significant impact on the market, and consequently can be a complicated product design and innovation process.

Incremental innovation refers to the improvement of an existing product or service for an existing market. Enhancing and upgrading something that is already on the market means that the new version will be better, faster or cheaper.

There are two other types of product innovation, architectural and disruptive. Architectural innovation refers to the improvement of an existing product or service for an entirely new market. Disruptive innovation refers to the development of new products or services for an existing market.

The importance of innovation is already evident in its different definitions. It is reiterated by the focus placed upon it by Forbes and Harvard Business Review, who both devote whole sections of their website to innovation. But let us break it down for you further.

Importance Of Innovation

A crucial element of product innovation, and learning how to innovate, is understanding exactly why it is important. The importance of innovation in business lies in the economy, and in the growth and impact of your business. Below are the top 3 benefits of innovation, so that you know why you should be changing how you think and how you work:

Economic Growth

Economic growth is an increase in national output and input. Product innovation prompts economic growth because new and improved products and services increase productivity, and increases supply and demand. This has a huge and widespread positive impact, as it allows consumers to buy more and grants them greater access to education and resources, resulting in a higher standard of living.

Competitive Advantage

Achieving product innovation means that the goods and services which you provide are relevant solutions to your customer’s demands, within the constantly changing and evolving marketplace. You hold an advantage over your competitors by being both proactive and reactive, with high levels of productivity and high quality output. These are all qualities which will be associated with your brand equity, influencing your customers’ purchasing decisions in your favour.

Maximise Return On Investment

Return On Investment (ROI) refers to the efficiency of your business investment. Having a high ROI means that you are successful in generating high returns. Businesses that prioritise the development of innovative products experience increased performance and profitability.

Examples Of Product Innovation

Now that you know the answer to “what is product innovation?” and “why is product innovation important?”, the obvious next step is to share examples. These should be able to provide some insight into how you can improve your approach, and the kinds of goods and services that set the bar. The following 3 product innovation examples are some of our innovation highlights, spanning the last decade:

Galaxy Z Fold 2

The Galaxy Z Fold 2 was released in September 2020, and Samsung has dubbed it a “unique vision of innovative technology and refined design”. An example of incremental innovation, this is Samsung’s third generation foldable device. Foldable smartphones offer portability, increased screen size, mobile productivity and multitasking capabilities.

Arlo Video Doorbell

Available since June 2020, the Arlo Video Doorbell offers customers home security and peace of mind. With HD video, motion detection, night vision and 2-way audio, it is one of the most advanced security cameras on the market.

Lush Cosmetics

Products created by Lush are packaging free, or come in containers that can be reused and recycled. This approach to sustainability is unparalleled across the cosmetic industry, and their product innovation has had a huge impact on reducing plastic waste and decreasing costs for the consumer.

How To Innovate

This wouldn’t be the ultimate guide to product innovation if we didn’t give you some tips and tricks on how to get started. Innovation, as a concept, can seem intimidating, but as you can see from the “example of product innovation” list above, innovation management and new product development happens every day. Below are 3 ways that you can introduce product innovation to your business, or improve on the foundations that you have already established:

Understand The Market

Innovative products are products which satisfy consumer demand or a gap in the market. To ensure that this is something your products are doing, you need to understand both the marketplace and your potential customers. You can do this by conducting market research, either internally, using a third-party market research firm, or by investing in data-driven analytics.

Brainstorm

Although it may sound simple, brainstorming sessions are incredibly effective in generating new ideas, thinking creatively and devising the next possible product success. There is no set format to brainstorming, and although it can be done independently, it is often more productive if your team is there to bounce ideas off each other and develop initial thoughts.

Challenge Current Boundaries

The key to product innovation, and innovative thinking in general, is to challenge everything you currently know about your field, your product and your customers needs. Think outside of the box and ask “what if?”. There are products that exist today that seemed impossible twenty years ago, which means that even your most outlandish ideas may be achievable.

Product Innovation Summary

Product innovation is what allows a business to thrive. It gives you an edge over competitors, allows you to maximise your return on investment and leads to economic growth, which in turn has huge benefits for the consumer, such as an increased quality of life.

In the last decade, there have been some truly stand-out examples of product innovation, such as the products mentioned above, through to breakthroughs in environmental tech, supply chain management and medical advancements. These are just the tip of the iceberg, with new and exciting products and services being released every year.

Although product innovation sounds difficult, and it is the culmination of dedicated, complicated work, getting started is much more simple than you might think. Understanding the current consumer marketplace, brainstorming with your whole team to generate creativity and productivity, and challenging the known limits of the existing products in your industry are all ways that you can take the first step towards product innovation.

Good Innovation With Leading Edge Only

Product innovation is at the heart of everything we do at Leading Edge Only. Our aim is to find solutions for the business challenges facing our clients, uniting leading innovators with organisations that require innovation.

If you want to access a global innovation community, connect with like-minded thinkers and discover game-changing solutions to every possible problem, then visit our website today.

If you need further advice on product innovation or finding an innovation consultant with a waiting solution, get in touch by calling +44 (0)1234 756 015 or emailing [email protected].