The hype around the word Innovation has never been as high as it is right now. Everybody is talking about innovation in everything. Innovation is ingrained in Technology to academics. It is talked about in pharmaceuticals to government policies. Innovation is shaping up energy generation and energy conservation. It is defining our home décor and fashion.
This post is all dedicated to whole bunch of Innovators out there. No, I am not a Innovation guru and so I am not giving you any tips on how to be Innovative. The idea of this post is to give a different perspective to our approach towards Innovation.
The Trigger for this post
I recently downloaded an app called Culinary Treats. I am damn concerned about my privacy and though I have a Smart phone, I have never switched on my Location Services. But I am forced to Switch ON my Location services post installing this app. You wondering why?
Its simple, the app looks at my location and suggests me eateries around my place where I can get around 15% discount on my bill. I felt that’s awesome. I was ok in compromising my privacy (temporarily) to get 15% savings on my bills.
So the app has made a reluctant person like me to open up and try the location based services.
This is the perspective I wanted to bring your focus on through this post.
There are 2 strategies to monetize Innovation
1. Identify what customers wants and then go and do that thing.
Build Innovation based on the finding and then let customers use it. This is the most common strategy and is often duplicated by rivals.
2. The second more defined, focused strategy is to build the ecosystem around the Innovation. The ecosystem is not duplicated . The ecosystem becomes the entry barrier for competition.
Why Focus On Ecosystem?
Innovation often requires a change in the way customers operate to leverage the benefits of the Innovation. This makes the customer reluctant to try the new thing if the perceived benefits of the Innovation are not good enough. A strong ecosystem around the Innovation would make the benefits look larger and makes a good case for the customer to change. The ecosystem built should be lucrative enough to transform a reluctant person into a propagator. He should get more impressed by the benefits of entire ecosystem rather than the solution in its individuality.
The need for an ecosystem might not be there in all the scenarios. But an Innovative Solution with a clear picture of how the ecosystem around it would look like is a sure shot winner.
An example of ecosystem driven Innovation - Apple App store
Think of Apples Innovative ITunes and App store approach. The success of both ITunes and iPhone is because of the ecosystem of Apps. ITunes has the biggest library of your favourite songs and App Store has the most innovative apps for use on an iPhone.
The ecosystem of developers brought out so many innovative apps on iPhone that it made the iPhone more than a phone. It is stethoscope for doctors, it is an extended branch for Banks, it is shopping platform for retailer.
The ecosystem took the iPhone to the next level way higher and above what iPhone was ever meant to be. That’s the power of ecosystem.
The biggest headache for Microsoft Windows phone is lack of apps. The Customers are reluctant to try Windows Phone because their favourite apps are not there in the Windows Store. And developers are not ready to spend time in developing apps for Windows Phone as customers are not there. This merry-go-round is the biggest roadblock for Windows Phone. And this is the biggest insurance against competition for App store.
Read this story to know "If Microsoft is doing enough to build an app ecosystem"
Conclusion
For an Innovator, the challenge is not in being Innovative but in building the ecosystem. The ecosystem that makes the Innovation significance and imparts it an identity.
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