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Strategically Assessing Your Market’s Appetite for Innovation

March 12, 2010
manageprouser

I have 3 favorite ways to assess a market and make sure strategically
resources are being assigned to the right priorities. Let me walk
you briefly through one of them in this blog.  I know it’s almost
the end of the first quarter, but it’s never to late to review your
strategy.

1. The first strategic question I try and answer is simply this:
Is the market mostly responding to new features,
standards or ease of use
?”

Usually there’s not enough resources to optimize each of those
positions for any one product.  If you assess the market wrong
(e.g. you add new features, when the market is buying  ease of use),
you actually hurt your sales, not just get a poor ROI on your
strategic investment.

So how do I go about assessing the market to answer that question?

I use the Innovation curve (see previous blog) and confirm
what’s the market doing (which competitors are succeeding) using
the question, “What stage of development is the market in –
 for that product/service from the perspective of it’s
innovation life cycle?”

That assessment helps me strategically determine where to invest,
versus my comfort or personal preference.  Without this market
analysis, I find that customers invest resources based upon
their own level of interest in innovation, not based upon their
market’s current appetite for innovation.

Identifying where the market is located on the innovation curve,
will provide clarity about the emotional drivers for purchasing
any product or service, and help you prioritize strategically
what you should invest in to best match up to current purchase themes.

The closer the market is to the early adopter stage, the more
your product will need to have and add, new, exciting features.
The closer it is to the early majority sector of the life cycle,
the more you will need to emphasize stability and productivity,
and to match up to and preferably be one of the standards.
Finally, the closer it is to the late majority phase, the more
you will need to emphasize ease-of-use and entertainment feature sets.

Bottom Line:

Assessing your market’s appetitie for innovation, when it comes
to responding to your product/service group, is one of my
favorite means of getting my arms around the market and
making accurate strategic decisions.  Here’s a link to a
Powerpoint diagram of the Innovation Life Cycle in the market process.

Let me know what you think.


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