Wednesday, June 09, 2010

The secret to innovation: Aim! Ready! Fire!

Springtime seems to have brought a refreshing zeal for innovation to the nation’s battered newspapers. And, not a moment too soon, given the 27% drop in advertising sales in 2009.

But, as I learned in my decades of running and financing start-up businesses, it takes more than desire to successfully bring new products and services to market. Product innovation requires discipline and methods that are not common at the typical newspaper company.

Fortunately, start-up skills – unlike blue eyes and the ability to roll your tongue – don’t have to be endowed at birth. They can be learned. That’s why I developed a rapid product development process that is being implemented at a growing number of newspapers. (You can get a summary of it by emailing me at alan [dot]mutter [at] broadbandxxi [dot] com.)

The quickest way to describe the rapid development process is with this simple mnemonic: Aim. Ready. Fire. Here’s how it works:

Aim. First and foremost, identify the audience and revenue streams you want to reach. Then, and only then, think about what products to build and the appropriate platforms (print, web, mobile, tablet, blimp, etc.) on which to deliver them.

This approach differs from the common mistake at many papers of building products and searching for markets for them as an afterthought. In the worst cases, papers build products but neglect to market them altogether. The lack of success likely to attend un-marketed or under-marketed products has the unfortunate side effect of blunting organizational enthusiasm for future innovative undertakings. This would not be a good outcome at a time newspapers need to be more creative than ever to attract fresh audiences and revenues.

Ready. Once you have identified a potential audience, revenue stream and product, it’s time to do your homework by building a detailed and hard-nosed business plan that includes, but is not limited to, an objective economic and demographic evaluation of the potential market; a bottoms-up revenue projection; a thorough cost analysis, and a comprehensive plan to take the product to market.

After completing your homework, you will know who in the organization has to do what, when they have to do it and – most importantly – how much it is going to cost. If this exercise shows the idea to be too complicated or costly to be worth the trouble, then this is the golden moment to abort the mission. If you go forward, the shared expectations provided by a well-conceived business plan should assure reasonably smooth execution. It also should avert embarrassing discussions about unanticipated cost overruns.

Fire. This is the phase when you take a prototype product to market to test its appeal so you can tweak the offering to optimize customer acceptance. Many newspapers stumble at this juncture, because they spend too much time and money trying to build a perfect product.

While perfection may be the ultimate goal, the launch (or beta) version of a product only has to be “good enough” to prove, or disprove, the concept. If the product catches on, you’ll have time to add all the bells and whistles you want. But there’s no reason to waste valuable time and resources on something you might have to junk. So, don’t get fancy. Speed the product to market, objectively gather consumer input and refine the product as necessary.

Once you have an honest assessment of its capability, either fill it with snazzy new features and a beefed-up marketing budget – or kill it if it doesn’t fly.

While failure is not the hoped-for goal, it is an option. Far more Silicon Valley start-ups flop than become the next Netscape, Silicon Graphics or Friendster. Come to think of it, we haven’t heard much lately from those once-big names.

You can enhance your chances of success by systematically developing and launching a product aimed at a carefully identified market. If your first innovative venture doesn’t succeed, however, do an honest after-action assessment of your mistakes and try, try, try again.

(c) 2010, Editor & Publisher


Blogger Unknown said...

If ever there was an industry in need of experimentation, newspapers are it! We may not know what the ultimate right answer(s) is, but we most certainly know what ISN'T -- i.e. traditional print metro dailies supplemented by free online access.

My favorite example of Aim! Ready! Fire! was Sidney Frank's creation of Grey Goose Vodka. The sequence of events that led to this astounding success were:
1. Decide on a market segment (upscale status seekers)
2. Decide on a price point (Much higher than high end market leader Absolut)
3. Decide on a name (pulled out of thin air)
4. Shop for a producer to make a still unspecified product (in France, just to be different)
5. Design the bottle to look very classy
6. Then and only then develop the product
7. Effectively promote the new product
8. Sell the successful brand for $2 billion (cash) to Bacardi just eight years after dreaming up the name for a phantom product

Dream on newspapers!

4:06 AM  

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