Showing posts with label consumers. Show all posts
Showing posts with label consumers. Show all posts

Thursday 17 December 2015

HOW INNOVATION WILL BENEFIT YOUR BUSINESS

If you are conversant with the foreign exchange market in Nigeria, at least you already know that the Naira is exchanging for as much as 260 for 1 dollar. It will be so easy to blame the government for poor monetary policies, but look around you, how many ‘made in Nigeria’ goods are people buying? Nigeria spent about N1.6tn on importation alone in Q1 of 2015. At this rate, there is no reason why the naira will not continue to fall as long as Nigerian businesses give consumers reasons to patronize foreign products. For instance, to fix tiles in the house, we rely on foreigners because most Nigerian businesses do a poor job.
The problem is not just in people not patronising made in Nigeria products, but their lack of confidence regarding the quality of the product, poor creativity and occasionally, high price compared to the quality. I can make excuses for highprice, but not quality and creativity of a Nigerian product.
Many small business owners in Nigeria are yet to compete because they lack the creativity and innovation required to be successful in business. Small businesses should be the champions of innovative thinking because what they lack in terms of capital, they made through innovative ideas. As we enter the New Year, here are few benefits of managing an innovation-oriented business.
Innovation creates more value for your business
Customers buy value, not product. Innovation helps you to create and add more value to your product at a relatively lower cost. When you manage an innovation focused business, your primary assignment will always be to make available improved product or services at a cheaper price. 
Innovation helps you make a balance between quality and cost. Small business owners should devote time to producing quality products/services with additional features, and the problem of lack of patronage for locally produced goods will be taken care of. Spend more time reviewing your product/service with the aim of identifying potential values that customers will be willing to pay for.

It gives you a Competitive advantage
Innovation gives you an edge in business. Take innovation away, no small business will be able to compete effectively in the market. Innovation whether in terms of products, services or even processes distinguishes you from the lot, and gives you a unique identity and position in the market. 
While some big businesses compete based on innovation, others like Dangote group are only surviving not because there is anything innovative about their products, but they have the capital and government backing. If you don’t have the capital or government backing to compete in the market, identifying areas your product or service can provide better solution can help you gain a competitive advantage in the market, because nothing places any business above board like innovation.

It enhances your business reputation
Innovation wins your customers’ confidence. I know of people who are addicted to anything with the Apple brand on it. They don’t question it, they just buy it. This is possible because Apple Inc has built an expectation in their customers, so they don’t have to question their products. 
When customers see how innovative your business has been over time, they develop confidence in your brand, and stick to it. Your business reputation is more important and valuable than the quick profit you want to make. Innovating in business doesn’t come easy but with persistence, you are certain of a great outcome.

Embedding innovation as an integral part of your business activities is the most challenging task; however it is your only choice for growth and competitiveness in the coming year.

Friday 23 October 2015

Business Lessons from Concorde Supersonic Aircraft

As a young man in 2003 during the last flight of Concorde aircraft from New York to London, I couldn’t wrap my head around the fuss about an aircraft that was retiring and why people were very emotional about it. “If it is retiring, why can’t they build another one?” I asked myself. While writing my last article, ‘3 Reasons Customers resist innovative product,’ Concorde Supersonic Airline was one of the failed ‘innovative products’ I considered, and I discovered that Concorde supersonic aircraft was so good that it wasn’t profitable to build another one.

Concorde Supersonic airline was designed to redefine luxurious air travel, indeed it did. It was the only commercial aircraft that was twice as fast as the speed of sound, and it was able to cut an 8 hours journey down to 3 hours. It was an engineering marvel and a delight to the eyes. Its innovative features were never in doubt, and it broke every market barrier in the aviation industry, and set a standard no other commercial airline could compete with. Its engineering feat was awesome, and technically, Concorde was ‘perfect’. By the time it was ready for the market, about 16 companies placed orders for over 70 aircrafts however, only 14 were eventually built for 2 companies.
So went wrong? Strategy wise, the business model adopted by developers of Concorde led to its resistance by potential buyers. The developers were so focused on the engineering and technical power that they neglected the business aspect of the aircraft. In fact, ‘the aircraft was built by engineers, not entrepreneurs.’ Just like the Concorde, so many businesses today have great products with bad business model. In developing the business model Concorde miss out on:

Customer Input
Customer input in the development of the Concorde was low or non existence. According to a group led by Matt Hooks, “....rather than focusing on the needs of the customers in the aviation market, the developers of the Concorde focused on creating the market itself thinking of the customers second.” The result was a total rejection by would-be customers and even the two airlines that had them in their fleet struggled to keep them profitable. Many entrepreneurs are so excited about the feat their product can perform that they believe, ‘once it is good, customers will buy.’ They are product driven, and care less about the need of the user of such product. Your customers should be an integral part of your product development process. Your business model is never complete without consideration for customers’ input.

Market Potential
The major implication of not including customers in your product design process is that you may likely misinterpret the potentials of your market. The Concorde developers believed that their innovative product will automatically translate into huge customer market. They only defined their market as those who want to fly ‘Supersonic’ without considering if those who could afford it are sufficient to capture value for the organisation. The Concorde’s market was narrowly defined, and its market potential was wrongly assessed, and this affected the value of its market. Entrepreneurs that wrongly assess their market potential will end up misinterpreting their market and losing value to less competitive businesses.

The implication of focusing on performance at the expense of customers’ input and market potential in your business model is the likelihood of wrongly pricing your products. For Concorde, the price was too high that the customers were not ready for the cost that came with it. Innovative products must provide a tradeoff between value and price, product performance is not enough to keep you going in business for long.

Sunday 19 October 2014

Infographic: The evolution of social media


The evoluation of social media as captured by http://marketing.wtwhmedia.com from 1970 to 2009.


Compare that to a more comprehensive graphic by copyblogger





No doubt the evolution of social media sites is not just interesting, but it has also showed how human needs for online socialization has given birth to very specific platforms that addresses either professional or social needs of people. As much as human needs for online socialization is growing,  and various platforms are needed to meet this need, not all platforms have succeeded in appealing to consumers' taste for online socialization. Moreover, the competition is so high that some have to drop. Below are some of the platforms that are no longer existing.

Avatars United, Bahu, Bolt, Capazoo, Ecademy, eConozco, FitFinder, Formspring, Hyves, Mugshot, PlanetAll, Pownce, Regeit, Sixdegrees.com, Surfbook, Windows Live Spaces, Yahoo! 360°, Yahoo! Kickstart, IslamTag, Yahoo! Mash, Friendster