Over the last year or so, major name-brand US companies have filed for bankruptcy. Most recently, the well-known camera manufacturer, Kodak, filed for bankruptcy protection. This is a company that invented the first hand-held camera and actually brought the world the first picture of the moon. Sadly, it’s not the only iconic company in the last couple years to ask for financial help. Companies like American Airlines and Hostess have also filed for Chapter 11. Why are long-standing companies like these failing while others are flourishing.?
You could make the case that companies like Kodak are circling the financial drain and need assistance because they have not welcomed new ideas as quickly as their competition. According to an article from Reuters, “Kodak once dominated its industry and its film was the subject of a popular Paul Simon song, but it failed to embrace more modern technologies quickly enough, such as the digital camera — ironically, a product it even invented.”
There are many factors that influence consumers’ buying behavior. Most people purchase something because of need or want. Whatever is culturally popular tends to be the leader in the product category. Established companies with a long history like Kodak have to compete with innovative products and services. How different would Kodak look today if it had developed Instagram?
How can companies get ahead and out of financial peril? By taking time for ideation and including the customer early and often in the process.
1. Understand who your current consumer is (or isn’t) - Simple demographic studies can show you how far of a reach your product has, who is using it and where they live. This data can help you mine out groups that don’t know your company or purchase your product, and can help you determine what will retain and grow your business. Once you know who your targets are, you can start brainstorming about what innovative products would appeal to them.
2. Be sure your product is optimized – Product testing should be a top priority on your market research to-do list. Is your current product competitive with others on the market? Is there a need for something new or improved? These questions can help you allocate dollars towards the right areas and determine what you need to do to gain an edge on your competition.
3. Be market-driven - Keeping the product line fresh is essential to compete with others who are coming out with the next “latest and greatest” product faster than you. Consumers are persuaded by new and improved. It is important to have your pipeline full and to continuously strategically test and introduce new products or services to the market.
Recovery from near ruin is possible. One of the most well-known comeback stories is Apple. Steve Jobs made the company healthy again by cutting back extra spending and focusing on what worked. He ensured the products could stand up to the competition, as well as appeal to consumers. Finally, only products that were successful were innovated upon.
More recently Chrysler came back from bankruptcy. Like Apple, they cut unnecessary costs and took a look at their line-up. They got rid of vehicles that were unpopular and focused on what the consumers were buying. Only after sales increased did they introduce new and innovative models, which have turned out to be successful in the marketplace.
Here at The Pert Group, we have experts in strategic planning and innovation who can help your brand through its lifecycle. Innovation isn’t accidental. No matter what stage of the process you are in, we can provide assistance with opportunity discovery, concept development and product refinement to ensure maximum growth for your company. How can we help you discover your company’s next big idea?
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