What makes a brand relevant and exciting? Is there some quality consumers look for to differentiate between two brands that offer similar products and services? At least part of the answer to these questions is innovation. In fact, a study released last year revealed that a majority of consumers around the world are willing to pay an average of 21 percent more for products from brands deemed innovative. In countries such as China, an amazing 90 percent of consumers are willing to shell out more for innovative brands.
Put more simply, having an innovative brand can unlock incredible opportunity. Which is why it is so important for brands to ensure that they’re perceived to be innovative in the marketplace. How? It starts with a company having innovation as one of its core brand attributes. And when that is the case, it is still important to communicate that essential truth to the world.
Create a Cycle of Innovation
One way that is accomplished is by continuously releasing new products. News equals new, which equals innovation. To be considered innovative, brands must regularly have something fresh for consumers to talk about. And it does not have to be a game-changing innovation that addresses unmet consumer needs — even minor upgrades can generate buzz. A motor oil manufacturer, for instance, can release special formulations for high mileage for four-cylinder cars and laundry detergent producers can add ingredients to extend freshness longer or eliminate wrinkles. In many cases it is something simple that makes consumers’ lives easier, such as a resealable bag or a better spout — it is not simply the innovation team coming up with new ideas, but rather conducting research to discover what the consumer wants and needs.
The benefits to a brand that demonstrates its innovation with new products include a consumer perception that a company is both an expert in its industry and that shoppers are personally benefitting from a brand’s cutting-edge work. Behavioral economics also tells us that the way innovations are communicated can motivate consumers: Loss aversion, the fear you might miss out on something new and great, can be more powerful than the belief that a purchase will make you feel good. Additionally, brand recognition and status symbols can resonate with the customer, who may think “I need a new cell phone; I should get an iPhone because all my friends have one,” encouraging them to spend more money than they might normally.
Build on a Strong Brand Identity
Innovation is great and necessary, but try hard to make sure those breakthroughs align with your brand. One reason it is so important to do the hard work to crystallize and communicate strong brand attributes is that even routine innovation can come across as random if it does not mesh with a brand’s overall tone and direction. Innovation not tied to a brand’s promise can be confusing and counterproductive. To ensure the whole development team is working in concert to produce products that are aligned with your company’s brand promise, it is important to facilitate internal communication. A consistent understanding and expression of your unique brand needs to be communicated to the whole team: product developers, marketers, and executives.
For more information on innovation and brand, please read our whitepaper ‘Avoiding New Product Development Traps’ or read our blogs, ‘A Brand’s Vision and Identity Should Drive the Product Development Process‘, ‘Inspiring Smart Innovation (and Avoiding the Inane!)‘ and ‘Roadblocks, Inefficiency, and Risk: Exploring Alternatives to Innovation Research‘
I would argue very important. Innovate or die as they like to say. Although brand equity can carry history it needs to be reviewed on a regular basis. Feelings, perceptions, and motivations change and companies need to keep a pulse on this.