Ideas are getting scarcer. Where will your company’s next great idea come from? Perhaps from your customers.

Introduction

"That’s an amazing invention, but who would ever want to use one of them?"

That quote, attributed to President Rutherford B. Hayes, in 1876 after Alexander Graham Bell demonstrated the telephone, has proven to be off the mark. Yet recent research does suggest that truly innovative ideas are harder to come by than ever.

Some would say it’s because the new era of the "connected consumer" lends itself more to "group-think" than to breakthrough ideas. We say it’s because companies aren’t yet tapping into the creative force of connected consumers—and that could be a huge missed opportunity. The new breed of borderless consumer communities holds boundless potential for novel ideas and insights that will translate directly to profitable products and services. This article takes a closer look at innovation in the new era, and examines how to harness the creative potential of the online community.

The Big Idea: Rarer—and More Richly Rewarded

Innovation is the biggest challenge most companies face. There is no question that innovation is essential to survival; the question is where the next big idea will come from. Increasingly, the answer to that question is past innovations. Incremental improvement to existing concepts is becoming the focus of a larger percentage of innovation, as opposed to cutting-edge, swing-for-the-fences, genuine big ideas. From the predominance of sequels and prequels at the movie theater to the swelling ranks of "me too" products on the shelves, the evidence of this trend is all around us. The graphic below, based on a recent McKinsey study of packaged-goods companies, shows a 40% decline in truly innovative ideas relative to modest or incremental innovations over the past several years.

Predictably, as the rate of breakthrough innovation slows, the reward for truly innovative ideas grows, leading to a far higher percentage of sales within a category than simple line extensions or incremental innovations.

Traditional Focus: Removing Bad Ideas

One of the key reasons our business culture tends to favor incremental improvement is that its processes focus more on eliminating bad ideas than generating good ones. The traditional flow goes something like this: brainstorming, subjective vetting of ideas to get rid of obviously poor ideas, optimizing of the best of the rest, and selecting final candidates for formal concept testing or development. All too often, the result is the promotion of the "strongest weakling." Far worse, many ideas with true potential are instantly dismissed because they appear too risky or cutting-edge. Others are simply not recognized as having potential when in fact they do.

And let's be clear: the occasional customer satisfaction survey or ethnographic study is not likely to produce breakthrough ideas; simply asking people what they want and need isn't always the best approach either. What’s needed is high-quality interaction with the new generation of connected consumers—tapping into their natural conversations as they discuss their problems and opinions and collaborating with them about new solutions.

Harnessing the Creativity of Online Communities

Connected consumers and online communities are not new phenomena, but recent advances in computing and communications have redefined the nature of their connectedness—and their collaborative capabilities. The blogosphere, the wireless Web, the ubiquity of handheld network devices—all create new opportunities for sharing ideas and information. Equally important, they give consumers something that until now has always been in purview until now: control.

Connected consumers insist on control over their experiences and the things on which they spend their money. They’ve bypassed brokers, bank tellers, and broadcasts; and they will not be marketed to in traditional ways. They zap commercials, auto-delete solicitous e-mail, and use caller ID and no-call lists to screen out telemarketers. They have declared to the world that they want things on their own terms, when they want it, wherever they are.

The unprecedented power of the connected consumer is not necessarily a threat to marketers. In fact, it represents a tremendous opportunity—because the communications capabilities also unleash new sources of great ideas and creativity, and they can help marketers gain a deeper understanding of key consumer groups.

For example, leading-edge consumer products companies are now experimenting with managed online communities. They are creating special-interest Web sites where people with common interests, hobbies, or passions can come together and exchange thoughts, ideas, and opinions about a specific topic—such as pets or toddlers or kayaking—and they are monitoring the natural conversations and getting closer to the truth about what’s on the minds of key target consumer groups.

These companies are discovering that consumers are not only willing but eager to join, to participate, and to contribute. And they’re not just contributing an answer to a survey question or an exchange with an interviewer in a focus group. They’re part of a continuous, ongoing dialogue that morphs—like the community itself—as newcomers join the conversation and contribute their own opinions and ideas.

Turning to Thousands of Inventors

It's a fair question: are these connected communities really a source of breakthrough ideas, or are they simply repositories for rants and rambles? A Fortune 500 maker of toys and games recently asked a privately managed community of moms for specific ideas on new products and received a landslide of concepts—many of them worthy of formal testing and development. The online community went beyond the concept stage; moms helped pick which ideas were best and provided specifics about when, where, and why they'd buy them, helping in the development of a marketing plan and creative marketing ideas.

"It wasn't our ideas and their feedback; it wasn’t their ideas and our feedback; it was true co-creation," said a marketing executive at the company.

"The online community is a flexible research environment," said Gala Amoroso, a research executive at Del Monte Foods, which works with private, managed online communities and monitors public communities. "Online communities give us continuous interaction rather than one-off, point-in-time studies. That is critical in getting us closer to our customers and what they really think."

"The online community is the key to getting past the era where the corporation is the executioner of ideas," said a marketing executive at Fortune 100 snack food company in a recent MarketTools panel discussion. "We're moving into an era where the company can be a catalyst for creative thinking and a facilitator, drawing on great ideas wherever they come from and making them better—turning them into products that match consumer tastes and preferences precisely."

MarketTools' clients have taken two basic approaches to using online communities for innovation:

• Built their own focused online consumer community. Del Monte Foods’ Pet Products Division created an online community where dog owners can share ideas about anything relating to dogs—from training tips to the best way to load a big dog into a small car. Del Monte Foods monitors the site and stirs discussion but does not attempt to control participation, promote products, or pay participants for their input. Through a site moderator, the company participates in the continuous consumer dialogue on the site, listening in on the natural conversations that may lead to product ideas, gathering opinions about ideas that might appeal to a mass market, and co-creating with participants. For example, Del Monte Foods might offer an idea about a new product and invite people to suggest improvements or refinements or alternative ideas.
• Participated in an existing online consumer community. Some companies may not need their own online community, but still want to tap into consumers’ online conversations. Joining an existing online community enables companies to economically learn from and collaborate with these connected consumers. An example is the Moms Insight Network from MarketTools, a shared research solution that gives clients access to an online community of 10,000 mothers that was created and managed by MarketTools. Clients can pose questions or create activities for the community that target specific issues or topics of interest, such as asking for suggestions for more educational toys for toddlers. By interacting with an online community during the ideation process, companies don’t have to come up with ideas and then test them with moms; they let the moms generate the ideas and flesh out the best ones.

Whichever approach you take, it is important to keep participants actively engaged and focused on providing relevant, useful input by guiding discussions around the issues that matter to you and your participants and by acknowledging their contributions.

The MarketTools Solution: Insight Networks

MarketTools has introduced an innovative research solution called Insight Networks™, combining monitoring across the Internet, community interaction, survey research, and analysis to give clients a more complete picture of the connected consumer. This approach makes it possible to draw sharper insights and see possibilities that might otherwise have been missed.

With Insight Networks, clients get beyond simply listening and observing—they can actually interact with connected consumers. They can initiate a dialogue, explore concepts and ideas, collaborate and co-create, and identify breakthrough business opportunities. Insight Networks enable clients to discover relevant feedback from the universe of consumer conversations; understand what’s on the minds of target consumers by continuously observing and interacting with them; and evaluate the potential of concepts and ideas through the use of on-demand survey research. Insight Networks provide:

• Internet-wide text analysis. MarketTools analyzes relevant content from more than 50 million blogs, message boards, and online media sites to provide a comprehensive look at what’s important to a target group.
• Targeted community interaction. Clients observe and engage with an online community of targeted consumers that is built and managed by MarketTools, allowing them to explore ideas through guided and unguided conversations, polls, and other online activities.
• On-demand survey research. Clients can assess and refine product concepts and marketing strategies through on-demand quantitative survey research, using MarketTools’ ZoomPanel™ and survey tools.

MarketTools offers both custom and shared Insight Networks to meet specific needs.

• Custom Insight Networks are dedicated, custom-built Insight Networks for on-demand observation, interaction, collaboration, and testing. They are for the exclusive use of a single client and provide the ultimate in research flexibility.
• Shared Insight Networks are available for use by multiple clients. They provide instant, cost-effective access to key consumers for authentic interaction and collaboration.

About MarketTools

MarketTools is the defining provider of on-demand market research. MarketTools enables companies and individuals to continuously understand their target customers through innovative approaches based on advanced technology, research expertise, and global market reach. MarketTools' full range of research applications and services provides organizations ranging from small businesses to Fortune 500 companies with unique access to their target markets—to uncover unmet needs, reduce time to market for new products, and capture more market share. Through Zoomerang,™ the pioneer in online surveys, MarketTools provides the leading self-services platform and services for fast feedback. Learn more at www.markettools.com.

Reprinted by permission of MarketTools. A MarketTools© Report - Connected Consumer Series: Fresh Perspectives for Strategic Thinkers in Marketing and Research. Copyright © 2007 MarketTools, Inc. All rights reserved.