Innovation: What does it really mean?
Thursday, October 4, 2018/
You’ve got a new startup in the works and are talking to potential investors and clients about your business idea. For most of us in the startup world, there’s a couple of buzzwords we all seem to focus on: innovation and disruption. So I thought it was worth digging into what these mean and how you can position these terms as an asset for what you’re building.
Innovation. What does it really mean? If you go to the Oxford Dictionary it gives a couple of explanations. The first is not all that helpful: “The action or process of innovating” (thanks Oxford for the great insight!). But it improves from there: “Innovation is crucial to the continuing success of any organisation”. Agreed! And then the more relevant explanation is: “A new method, idea, product …” Now we’re getting somewhere.
Quite simply, innovation is all about doing things differently. When we build our businesses, most startups focus on how to use technology to deliver something new, more efficient and better, as well as how to create a product that’s different from what has been offered to customers previously.
Innovation is not new. We, the human race, have been innovating for millennia. An example is the short history of written communication: we turned hieroglyphics into clay tablets, then into papyrus, then paper and all of a sudden we had an iPad and headup displays in our cars! The key driver through all of this was our desire to improve the way we do things.
When you’re building your startup, you typically start from a position of strength. You have a close connection to the industry you’ll be servicing and understand intimately the challenges experienced by your target market. There’s a gap in the market, and you’ve identified how your specific piece of tech with transform and disrupt how that industry works. If you’re successful, there’ll be opportunities for some kind of investment to help build your solution, with the ultimate goal of securing a large range of customers, each paying you to use your fantastic piece of technology as it evolves.
I’ve had a stack of personal experience in building businesses and meeting market demand through an innovative product. When I co-founded Allure Media in 2007, the gap in the market we attempted to solve was how to best engage readers with prominent ad formats that advertisers would pay a premium for. We were the first Australian publisher to fix an ad to the top of a page so that is was ‘in view’ for the entire time a consumer was reading a page (while they scrolled through the content). As a result, these ads were more impactful, received a greater share of voice, and were displayed to a consumer for longer — all of which encouraged advertisers to pay more for these ads. Tick: multiple problems solved with one piece of innovation.
This was not just a technological innovation, but rather, something that started as an idea, was strategically important to the business, and added value for multiple stakeholder groups — these being the business, our investors (as we generated more revenue efficiently), our clients and our readers (ads were targeted to them to ensure they were relevant to the content they were reading).
This innovation helped disrupt the Australian online publishing industry. At the time, most ads were standard size formats with relatively unsophisticated ad serving technology sitting behind them. Due to the revenue and clients we were attracting away from the incumbents, very quickly we noticed our competitors start to copy our strategies.
This is where it gets fun!
Innovation is not a linear, one-dimensional process. Innovation should be constant with your business and the ideas you’re generating. Your challenge (should you choose to accept it), is to foster a culture of innovation inside your startups so you can always keep one step ahead of your competition. This creative energy is what encourages investors and your clients to want to work with you.
When you approach the conversation about innovation it’s not just the technology that is innovative, it’s the ideas and your creative process to bring them to life using technology. Keep this front and centre with everyone in your business, and remember, innovation is about generating new ideas, doing things differently and then successfully implementing them to deliver value.
From the frontlines
Why you should find the right role for the right person — not the other way around Bruce Stronge Outfit founder
Five lessons from five startups: What this entrepreneur learnt from 20 years in business David Lye Price My Car founder
From stagnant to sophisticated: Why startups are best positioned to champion the AI revolution Geraldine McBride MyWave co-founder
Learning from adversity: How Katt Srinivasan went from rock bottom to e-commerce entrepreneur Katt Srinivasan The Bargain Avenue founder
Bitcoin isn't a boy's club, women just aren't getting involved Chantelle de la Rey Amber co-founder
Managing a remote workforce is simple, writes Hometime co-founder William Crock William Crock Hometime co-founder