In 2019, the need for faster and more reactive innovation will become even more integral. Some companies have already realised the importance of speed and are implementing more streamlined innovation processes, but next year we should expect to see a lot of this being put into action.
Already, larger companies are creating spaces dedicated to innovation that sit outside of the business and this will only become more common over the next 12 months.
PepsiCo has launched ‘The Hive’ in the US, which will be an innovation hub to foster smaller and niche brands. PepsiCo chairwoman Indra Nooyi (speaking while still in the position of CEO) explained this decision on a results call in July.
“It is a business within a business and will be taken out of the core headquarters,” Nooyi said. “It’s going to be an entrepreneurial group which will take some of the products we launched and nurture and incubate them to find what works.”
Coca-Cola is doing something similar with its Global Ventures Group to speed up routes to market for newer brands. It is about speeding up innovation for its hero products, not just new portfolio additions.
Arnab Roy, senior global director of Coca-Cola trademark, tells Marketing Week that faster innovation is a key priority for the company moving forward.
He explains: “Innovation is going to be a very important driver on every brand. Yes, Coca-Cola classic will be the biggest jewel we have but we do feel innovations have to happen with Coke. There is a lot more flexibility with what Coke can do than what Coke can’t do.”
He adds: “A lot of the ‘holy grail’ [brands] have a ‘why not’ attitude now.”
This attitude also extends to marketing, with Coca-Cola saying the use of crowdfunding sites will become more commonplace. This year it used crowdfunding site Indiegogo to launch its premium Swiss water brand Valser in the US. Coca-Cola joins Heineken and Procter & Gamble, both of which have also used Indiegogo to test and launch products.
Because the investment comes from outside of the business, crowdfunding helps companies to be less risk-averse. But it also functions as a marketing tool, raising awareness and gauging consumer appetite. As companies try to launch more products in 2019 at a faster rate, this option is only going to become more popular.
As companies try to launch more products in 2019 at a faster rate, this option is only going to become more popular. Honda cited a need for speed in marketing as a reason for creating its in-house content hub, Engine Room. The aim is to streamline online media and advertising so that it can be more reactive and independent.
The end of 2018 has seen brands introducing ways to speed up marketing and 2019 will see the fruition of these efforts. It is inevitable some will fail, but in this brave new world, failure matters less as long as you fail fast – and cheaply.