This blog first appeared as Dave Farber's piece for Medium
By Dave Farber
When it comes to innovation, one of the biggest impediments is also one of the most frequently overlooked: inertia. Companies often mistake inertia for loyalty. They assume that the customers who are buying their products today will continue to buy from them as long as they do a reasonable job keeping up with the competition. The risk is that they’re vulnerable to being blindsided. As one business writer put it, “a body at rest tends to stay at rest. A business at rest tends to die.” As companies get complacent and settle for incremental innovations, they risk losing large swathes of their customers as markets shift and new entrants offer real value.
And new entrants themselves may underestimate inertia. They think that if they can get enough awareness about their products, they’ll be able to unseat the industry giants. The reality is that customers tend to continue on the path of least resistance until there’s real incentive for them to do otherwise. Just because you build a great new product, it doesn’t mean that customers will come. Companies looking to launch successful new innovations need to focus not just on making sure that a customer is happy with the offering, but also on making sure that the customer has a chance to learn about it and try it out in the first place.
In my book on Jobs to be Done, I outlined five strategies that companies can use to combat inertia. These strategies aren’t simply theories or historical anecdotes. To illustrate the continuing effectiveness of these tactics, I found five companies that used these tactics in 2018 to help their innovation efforts gain traction.
Capitalize on underlying purchases. One of the first strategies for fighting inertia is to tie your new offering to a purchase the customer is already making. Take Quip as an example. Quip launched its low-cost electric toothbrushes in 2015. It faced stiff competition from Oral-B and Philips, who collectively account for 85% of the U.S. electric toothbrush market. As of October 2018, Quip had just sold its millionth toothbrush. The company’s low prices — supplemented with a toothpaste and brush head subscription model — have allowed the company to steadily gain traction, but there is plenty of room for improvement.
To increase its growth rate, Quip has begun to move away from its online direct-to-consumer model. The company recently began selling its toothbrushes at Target. More importantly, though, the strategy for this year is “all about drawing in dentists.” Quip is leveraging the visits that people already make to the dentist to ensure that they continue their subscriptions. By partnering with over 15,000 dental professionals, Quip has set up an ecosystem whereby customers get reminders of when they’re supposed to have their 6-month cleanings. When customers visit the dentist on-schedule, dentists can reward them by paying for the next two refills on their subscription. Customers get a discount on their brush heads, dentists get to bill regularly for cleanings, and Quip gets a drastically reduced drop-off rate for its subscriptions. At the same time, dentists who have gained awareness of Quip through the partnership can recommend the toothbrush to patients, giving Quip access to a much larger network of customers than it could reach on its own.
Leverage existing behavior. Similar to capitalizing on the purchases customers are already making, companies can promote trial and sales by taking advantage of customers’ current behaviors. Forcing people to change the way they behave can be hard. Instead of trying to swim against the tide, it’s easier to unveil solutions that fit with what people are already doing.
Shopify launched its eCommerce platform in 2006 to help businesses build an online presence and avoid becoming overly dependent on Amazon. But getting people to go to sites other than Amazon to shop — other than for certain specialty purchases — is often a challenge. As things stand today, 49% of all online sales in the U.S. currently go through Amazon. Rather than continuing to fight behavior, Shopify made the decision this summer to go with the flow. Instagram has over 1 billion active monthly users casually scrolling through photos of friends, celebrities, and brands. So this summer, Shopify inked a deal with Instagram to allow customers to buy items they see and like while doing what they were already doing — casually killing time on Instagram.
Bring old products to new occasions. Microsoft launched Kinect, its motion-sensing technology for Xbox, in 2010. It was neat, but customers lost interest quickly. The company started deemphasizing Kinect in 2014, and it officially stopped manufacturing and selling Kinect devices in 2017. Although the technology was advanced, Kinect added little benefit for the core market of Xbox users. In fact, getting rid of Kinect gave developers extra processing power, and it made the system significantly less expensive. This year, Microsoft shifted gears and relaunched Kinect in a B2B context where it is being better received. The new iteration — Project Kinect for Azure — allows developers to use the advanced Kinect technology to improve AI, enable business automation, and augment communication solutions.
Make offerings affordable. If you want more people to buy what you’re selling, make what you’re selling cheaper. While that sounds straightforward, it’s often easier said than done. Making offerings affordable often means trying out new business models such that customers can pay in different ways or that some portion of revenue comes from alternative sources. For car buyers, there has generally been a choice between buying and leasing. This year, however, Mercedes launched its Collection subscription program whereby customers can access luxury cars for a low monthly price, even if they can’t afford the heavy down payment that comes with buying or leasing a car. Notably, the subscription price includes things like maintenance and insurance so that customers know exactly how much they’ll be spending from the outset. And they don’t have to deal with separate mechanics and insurance agents in the process. As a result, Mercedes is able to reach customers for whom luxury cars were previously out of reach.
Ease the ability to try. The final tactic for fighting inertia is to make it as easy as possible for customers to try out what you’re offering. If they don’t know about it or can’t evaluate it, they’re unlikely to buy it. Lyft recently launched its Ditch Your Car campaign. In exchange for not using their cars for a month, participants will receive $300 in Lyft Shared credits, a Zipcar membership and $100 in drive credit, $105 in public transit fares, and $45 toward bike-share fees. While giving up your car seems scary, Lyft is hoping to show that many people who currently own cars can actually save a lot of money and hassle by taking advantage of ownership alternatives. That’s especially true for two-car households in urban areas, where many people hold onto cars more out of habit than necessity. By offering an alternative to the status quo, Lyft is helping people realize that their current choices may not actually be the best ones.
Innovation is hard work, and customers aren’t going to do the heavy lifting for you. In fact, they’re going to keep doing what they’ve always done until you give them a compelling reason to shift their behavior. But by making it as easy as possible to learn about your new offering and give it a try, you’ll be that much closer to overcoming the biggest obstacle to innovation: inertia.
Dave Farber is a strategy and innovation consultant at New Markets Advisors. He helps companies understand customer needs, build innovation capabilities, and develop plans for growth. He is a co-author of the award-winning book Jobs to be Done: A Roadmap for Customer-Centered Innovation.