Innovation is not invention and, similarly, all inventions are not innovative. Innovation can, and often does, include iterations or re-packaging of existing inventions in ways that make sense for broader groups of consumers to use. Interestingly, I came across this article which describes how people don’t necessarily want something new but rather, something familiar done differently. The article highlights how Japanese restaurants’ “sushi breakthrough” with American consumers was when they made the California Roll, which packaged familiar elements into a sushi framework. On the surface, this article is exactly correct. We can think of many examples where the familiar and repackaged gains traction in mainstream consumer markets. I consider something like the California Roll an innovation. But there is a fundamental point about invention that needs to be made on top of this observation.
Packaging the Familiar
Taking something existing or understood by many is surely the fastest way to reach a tipping point in consumer volume. The incredible and rapid success of the iPad can be explained by this process. The iPhone was familiar and the iPad was the iPhone repackaged into something new that enabled a new set of use cases built upon the familiar. In similar ways, the iPhone capitalized on this by taking elements of the familiar, the phone, the internet/web browser, and the iPod and using that as a base to spur adoption. Apple may be the best tech company in the world at this process. This concept is duplicatable and one that is the tried and true method to grow adoption. Many existing apps use this process and many that don’t, should. It is the best way to attract users and grow. However, as important as this process is, there is a case to be made for invention.
In Defense of Invention
It is much more risky to create something new. Something wholly unfamiliar to the public mindset. It is also very rare. We don’t see true invention as frequently and we certainly see true invention commercialized even less frequently. While I may get push back here, I’ll use the Apple Watch as a first example. The Apple Watch is something new. It may be Apple’s first attempt in a long while to truly bring something new to the market. Smartwatches, and the Apple Watch, in particular, are not re-packaged iPhones. The Watch has features of the iPhone unbundled and put on the wrist, notifications for example. However, in my mind, the Apple Watch is more “new” than the iPad was, which is a big reason I’ve been adamant the adoption cycle will be slower. Robots, drones, maybe even autonomous cars, all fall into this bucket. It takes time for the market to understand the new. This is a primary reason many companies will shy away from it. However, it needs to happen or our tech future will be quite boring. I’d like to propose some theories on the types of companies who can and should successfully work to commercialize inventions.
Commercializing Invention
I’d argue it takes three things to commercialize invention. The brand, a focus on design and the user experience, and great marketing. I know I just described Apple for the most part but, when it comes to consumer tech, those pillars are essential and few companies do them well. I don’t say all three are necessary but a focus on user experience is the essential starting point, followed by great marketing — those two things can lead to a great brand. However, companies who start with a great global consumer brand, like Apple, already have a strong footing to commercialize invention. Consumers will default to trust. Apple also has nearly 500m loyal customers, they focus on user experience, and can tell the story with marketing. They also have a lot of money, another reason not to write them off as they commercialize inventions going forward.
It sounds super bullish on Apple, and readers should know I am, but their template is sound and can be used or strived for by other companies looking to build global brands and bring new classes of products to market. Hopefully, other companies will not shy away from invention and commercializing those inventions, particularly hardware companies. Tesla is another solid case study. While we may argue they are innovating more than inventing, their emphasis on the user experience is a core part of their draw. We desperately need new global hardware players in many consumer tech categories looking to push the envelope and prioritize user experience.
My concern is the hardware companies of tomorrow either aren’t willing to take the risk on invention or these companies are not being funded because VCs don’t want to take the risk. We need these companies to exist and push the industry forward. Hopefully, the fundamentals above encourage them to be bold and take risks but understand what to focus on to help them succeed.
Oh, God, Apple, Apple, Apple and then again Apple, Apple, Apple (and a little bit of Tesla)…
Will I, one day, read an article on this site that will not be Apple-centric ? I mean, come on! Nobody else than Apple innovates in the consumer tech field ? Really ?
Now, don’t get me wrong, I do think Apple makes great products. I own an iPhone and an iPad and they serve me well, I may even say that I love using my iPad, but does that give me the right to say that it’s THE best tablet ? You admit being “super bullish on Apple”. As a consumer, you have the right to be so, but as a tech analyst, you have to restrain yourself from voicing your enthusiasm for a particular company or brand and stick to a minimum of objectivity. That’s the least to do if you have any respect for your readers…
I was trying to be sensitive to this point as you can tell. But in reality how many companies out there can you list who truly start at the user experience level? Apple doesn’t always get it right but it’s hard to admit they are not a good template to use for success. To your point about me being an analyst, I’d counter with the role of a good analyst (and consultant since I do that also) is to teach. Apple is often a good use case to use to teach others important lessons.
And lastly there is lots of non-Apple content on our site. Just look back through the last few weeks.
What I’ve seen over decades is, it’s often the other way around: commentators look at successful companies, then rationalize after the fact what they’re doing right, latching onto the successfuls’ most salient features.
The whole “aspirational brand, sexy product, funky ads” combo started working only because IT’sgrowth moved from Corp to Consumer. Apple get kudos for seeing that first, and finding the formula to adress that market. In non-consumer, non-tech markets, I don’t think the same 3 pillars apply. I’m not even sure they apply over the lifecycle of the consumer tech markets.
You mean the saying “No one ever got fired for buying IBM” was a lie?
Joe
I’m not grokking your point.
My point is the 3 pillars work in either non-consumer/tech as well as consumer/tech. There will just be different companies and examples of the pillars. Aspirational, sexy, funky is true in either category. There are just different definitions for each depending on the market in discussion. IBM was an aspirational brand and never the cheapest.
Joe
“Will I, one day, read an article on this site that will not be Apple-centric?”
Sure, you can make that day today. Peruse the main page of this site and click on the articles with very few comments. Here’s a recent one: http://techpinions.com/musing-on-the-on-demand-economy/42046 And another, http://techpinions.com/the-upcoming-spectrum-auction-might-disappoint/42106.
If you’re tired of “Apple, Apple, Apple”, how come you’re not reading the non-Apple articles?
Innovation and Invention, along with Discovery (omitted from the article), are intertwined, but distinct.
These definitions have generally served me well…
Discovery: The acquisition of previously unknown knowledge. It was there, but it got found and understood. A mathematician discovers a theorem. Einstein discovered relativity, he did not invent it. Darwin discovered evolution, he did not invent it. Becquerel discovered radioactivity, he did not invent it.
Invention: The use of knowledge to create a physical object. It must be new, novel, non-obvious and have utility.
Innovation: The creative use of knowledge to manifest a new idea. It need not be technical. A poem is innovative, a book, a business practice (can be), etc.
Discovery and invention can and do require innovation, but they are distinct. Innovation is not bound to commercial success (that’s a businessperson’s world view), it has to do with the value added to a concept, by the creative use of knowledge.
“Invention: The use of knowledge to create a physical object. It must be new, novel, non-obvious and have utility.”
I don’t think you are asserting that new processes cannot be invented. Or are you?
Good point. Until the ’90s, processes and software could not be patented. I still think that should be so, but that’s me. Still, even today, a mathematical equation cannot be patented (justly so). Since all software and processes depend on an algorithm, which IS a mathematical equation, I find it paradoxical that software and business practices can be patented.
Processes are like mathematical equations: “if this, then that” or “when this then that”, etc. So though I consider them to have the potential to be innovative, they are not inventive, but at this point we’re into semantics.
I think patentability is a wholly separate discussion. I am talking about production processes actually. Such as inventing the system of just-in-time manufacturing. Or Amazon’s ‘revolutionary invention’ of one-click ordering. /s
Amazon’s egregious example is why I oppose these kinds of things as inventions. In milder contexts, I call them paradoxical. You “discover” a method, as you would an equation, or theorem, more than you invent it.
Perhaps you mean to say you oppose those kinds of patents but the inventions are okay.
Whether a process is something that is discovered or invented is, as you said, semantics. Whatever it is, it’s something new that somebody came up with. Whether there is a trove of production processes that exist somewhere in the ether that just needs to be discovered or whether someone invents the process purely out of whole cloth … I leave that to Plato and his detractors.
It’s hard to disagree with your thesis, but I think it skips over a few aspects and feels as if you assume companies are operating in a timeless vacuum.
– Brand space is limited, and almost a zero-sum game, especially for consumer products. By definition there can only be one best brand. Should the others just give up ?
– Price is missing from the equation, yet for say, smartphones, price is always the first criteria, at least in unsubsidized+unfinanced markets. 80% of the recommendation requests I get are in essence “what’s the best phone I can get for 100/200€” ?
– Features/capabilities are also missing. They could be subsumed in “User Experience”, but it’s not quite the same thing: the same camera app can take good or bad pictures depending on hardware, an otherwise excellent phone can run out of juice before the end of the day, and of storage before you finish loading up your music…
– Lock-in and network effects: those are major sales drivers in mature markets. With an iPhone, you can pretty much only use an iWatch because the most interesting APIs are locked down. Reciprocally, you can only use an iWatch with an iPhone. On the network effects side, iMessage only works on iDevices, and iPictures on anything but a iDevice is a puzzling experience. etc, etc…
I don’t think success is only built on great companies making magic products sold by inspiring ads, which is what the formula you end up with boils down to. I think there’s a fair amount of much colder-hearted decisions and processes at play.
I’d look at consumer packaged goods as an industry to learn some lessons from. Sometimes price is a leading decision factor and other times it is not. Price being the first factor is a subjective point and not a universal truth. This varies greatly.
In CPG there are many brands, and many brands fighting for consumer attention. This will remain true in consumer tech particularly as the price hike to add “tech” to many non-tech products becomes trivial.
But look at Disneyland, high-end restaurants, Tesla, etc., for areas where consumer experience is central and not simply limited to a software UI. Things that create positive “moments,” “experiences.” or “memories” will go a long way in establishing themselves with a very fickle global consumer audience.
All the examples you cite are luxury stuff. Sure, those sell on moments and experiences. My community pool sells on “hey, it’s not dirty”, my corner pizzeria on “tastes good, doesn’t give me the runs, saves me a half hour of cooking for 10€”, and most cars sell on “cheap to buy, cheap to run, won’t break”, ask Toyota back when they overthrew Detroit.
Also, IT has a key difference from other CPGs: lock-in and network effects (and a learning curve). I know I sound obsessed by it, but the previous 2 IT golden children, MS and Intel, built their whole business stories on those – and never really acknowledged that -. I just can’t not think of those, and am utterly puzzled by the general obliviousness.
I’m only looking at consumer products.
I think (and I could be wrong) you are conflating commercializing with commoditizing. Commercializing comes first. Smartphones were commercialized by iPhone. Then came the commodity players looking to play on price, after a price bar had been set.
Joe
That’s why I’m talking of a “timeless vacuum” issue. 80% of the market (I know, not of the profits) went to companies not on the “aspirational, magical, funky” formula (or not quite getting it as right as Apple ^^). What happened ?
I’m not sure why you think Ben’s point about successfully commercializing invention equates to market share domination.
Joe
Indeed. But on the other hand, I think there’s a success = profit = luxury slippery slope.
I’m not sure it’s true in the absolute (there’s something to be said for volume indeed, also for surviving to fight the next round, ask Apple), and I’m not sure it’s true at all times (some markets go from premium-driven to mass-market driven, see Ford)
Perhaps the point I’m making is that those who focus on user experience will not be forced into a race to the bottom in any category they choose to compete.
I wonder if that’s partly because the user experience can never be good enough and therefore cannot be commoditized, or is at least very difficult to disrupt?
Isn’t that goal very specific to very few companies ? I’d argue Google’s goal with Android is “not get locked-out of ads”, and MS goal in Mobile is “not lose Entreprise from Consumer contamination”.
I’d guess they don’t mind the race to the bottom, actually it probably helps them reach their goals ?
I think many companies we talk to in the consumer space consider themselves user experience companies. Problem is many are not very good at it. This is true across all vectors, hardware, software, services, etc.
I am not so sure about your comment. Look at Mercedes, BMW, and others. They are definitely racing to the middle and starting to reach for the bottom. The high end cars are not making the most revenue, it’s the middle to lower middle, and possibly soon the higher low end as new models that sell quite we indicate.
Also, I am not sure if Apple can be used as offering the best user experience. Their products are great, the software is so-so, and the services are quite confusing for many to take full advantage.
I think your audience is to a small community, and not addressing the ‘real’ population. Imo, people are buying Apple products because it’s cool and signifies some sort of affluent persona, not because people woke up and said, ‘apple offers great user experience’.
disagree. Have quite a bit of functional social science on tech usage to back up my conviction. Largely from doing some studies specifically on Android users who switched to iPhone. Most did so based on functionality and things I define as UE not because it was cool.
Is there a study on how people answer studies ? I’ve had people tell me they buy Prada because they’re comfortable and Burberry’s because they’re warm. And that was people I knew, and straight to my face.
This was all behavioural observational research focused not surveys.
Key point. Not everyone is the same and many reasons why certain things speak to some and not others.
Agree that the high end cars are not generating the most revenue but I think they have the fattest margins. Don’t get caught up ‘on market share is king’, that mentality is so prevalent today because that’s how startups convince venture capitalists to part with their money.
And you can argue that MB and BMW are racing for the middle but they are definitely not reaching for the bottom. They each tried that before: Chrysler for MB, Austin-Rover-MG-Mini for BMW. Both were failed acquisitions.
Actually, what the luxury marques are doing is they are extending to the middle, not racing to the middle. Racing to the middle to me implies abandoning the high end and concentrating on the middle. In the same way that the Wintel race to the bottom saw the mfrs surrendering the higher end.
“The brand, a focus on design and the user experience, and great marketing.”
It’s easy to see how Google, FaceBook, Amazon, Instagram, Twitter, Netflix, and other great web companies fulfilled the design and UE requirement. (And, good news, MS is paying attention to design, UE, and marketing today.)
Marketing seems to be ‘nice to have’ as most of these web giants grew big without much real marketing done.
Your concern seems to be that hardware companies do not seem to be willing to invest in “new” inventions/innovations.
This is interesting if you look at what Microsoft is doing with HoloLens, what Facebook is doing with Oculus, and what Google is/was doing with Glass. These companies certainly look like they are working hard on “new” hardware inventions/innovations. It may be the case that the hardware companies of tomorrow will not be the hardware companies of today. Instead, the software/services companies will replace them to be the hardware ones of tomorrow.
This is not necessarily a surprise if you consider that “new” inventions/innovations require a high level of R&D expenditure. In fact, you probably could make a general statement that it is simply the companies that are making money that are investing in the “new” hardware (by this criteria, Apple is certainly qualified to be one of the hardware companies of tomorrow). Previous experience in hardware isn’t really key at all. Conversely, the ones that do not make much profit (Windows, Android OEMs come to mind) do not have enough money to invest in risky endeavours.
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