Tag: Innovation

CMO Insights: Digital Innovations

Posted on by Drew Neisser

Beth ComstockSmall brands innovate out of necessity. Their very survival depends on finding not just a fresh solution to a customer problem but also a distinctive means of getting their story out there.  Fewer naysayers correlates to fewer entrenched ways of doing things equals faster pivots and a natural openness to experimentation.  For big brands, however, innovation is a triumph of determination over institutional inertia.  Or think of it this way, organizations are like planets–the bigger they get, the stronger the pull towards the center.

In this scenario, as one of the largest corporations in the world, GE should have the gravitational pull of Jupiter, crushing innovators before they can take a single step.  But guess again, big bias breath! From a marketing perspective, GE has been on the forefront of digital innovations for the last decade putting many smaller companies to shame.  Curious about how this was possible and thanks to an introduction by The CMO Club, I was delighted to be able to catch up with Beth Comstock, GE‘s CMO (who won The CMO Award for Leadership).  There is nothing more I could say that would be as near as insightful as the counsel Beth provides below.

Drew: For several years now, GE has been ahead of the curve when it comes to experimenting with new channels.  What is the strategy behind all of this experimentation? Is the medium essentially the message?
Beth: GE’s a leading technology company so we believe it important to be aligned with leading edge technology channels. The other thing to consider is that our audiences expect GE to be where they are – they aren’t going to always come looking for us.  We like to experiment as a way of learning, but our efforts have to align to our goal of connecting with our target audiences, which are largely industrial technologists and enthusiasts. And we’ve adapted our strategy around  being micro-relevant – meaning targeting the right audience in the right way. It doesn’t have to be a big audience, just the right one.

Drew: As the CMO, Is it a mandate of yours that GE explore all the newest coolest channels and if so, how are you finding them?
Beth: We have an awesome media team that identifies themselves as digital explorers.  We also take risks with new ideas and small companies as a way to learn and as a way to augment more traditional plays.  I’m a big believer in  carving out a percentage of your budget to develop new models.

Drew: Naysayers struggle to understand how a photo contest on Instagram or a promotion on Pinterest can help you sell GE products like aircraft engines. What do you say to those folks?
Beth: Selling a jet engine is a complicated sale.  Many people influence the purchase decision. And since GE is a company that traverses multiple industries, pretty quickly you’re targeting decision makers across a wide range of the economy and functional roles of business, which is why we believe in the importance of building a vibrant umbrella brand.  In addition to those who buy our products, we target enthusiasts, recruits and GE retail shareowners who want to experience GE in various dimensions.  Industrial technology is exciting, yes, even fun… and some of these outlets allow us the opportunity to open up and express ourselves in new ways.  People want to see that you are approachable.

Drew:  How has your role as CMO evolved over that past decade?  With the advent of “big data,” are you spending more time on analytics that you used to?  
The role of CMO has evolved from defining what marketing can do to delivering it.  I’m a  big believer in marketing’s role as developing markets, and new models. We like to think our contributions are in mindshare, marketshare and margin.  We’ve tried to make marketing a driver of commercial innovation that sits alongside our technical innovators to deliver a range of value to GE customers.  Big data is a perfect space for marketing.  A customer wants to run their business better not just have lots data – those insights help focus the data scientists on analytics that matter most.

Drew:  GE is primarily a B2B company yet you seem to act a lot more like a B2C company in terms of creating emotionally-rich consumer-friendly communications.  Any thoughts on why that is?
Beth: Since when does B2B have to be boring to boring?  Business people are people too. We are emotional beings, we don’t just rely on logic when it comes to business decisions.  Good marketing is about making a connection and delivering perceived value. Period.  In some ways, business marketers have an advantage in that they are closer to their customers and in theory should be more responsive and intuitive.

Drew: Content marketing is suddenly a hot buzzword in the industry.   Are you investing more resources in content development?  
Beth: We’ve been on a path as a content producer for several years now. We’ve widened our definition of content to include data, experiences and yes, emotional connection and even humor.  Content has to be useful and relevant to be effective.  We’ve invested in a range of skills like data visualization and user interaction design as a way to drive content that is engaging and relevant. The marvels of science, engineering and manufacturing offer good fodder for content, and we’re constantly seeking out storytellers who get as excited about this as we do.

Drew: Marketing seems to be getting increasingly complex in terms of ways to spend and ways to monitor. Has it gotten more complex for you and if so, how are you dealing with that complexity? Yes, it is more complex – we have a multitude of outlets and a range of content types to consider.  You need good partners, room for experimentation and a good dose of curiosity.  Trust me, it’s not about the size of your budget, it’s about the ability to use complexity to amplify your efforts, not stifle them.

Drew: Innovation is a sexy word but not as sexy to a CEO as ROI.  Have you been able to link your innovative marketing activities to the kinds of business metrics favored by CEOs?  
Beth: Innovation can’t just be about fun ideas or wonky theories.  Innovation means new methods that yield results.  The challenge is often that time, trial and error are required to get to scale.  I’m a big believer in pilot projects to create proof points and staged development to make sure you get results.  Innovation without process is chaos. Trendspotting without translation leaves you empty.

Drew: Besides your efforts on Pinterest and Instagram can you speak about another recent innovative program that you are particularly proud of?
Beth: I’m especially proud of the work we are doing to help define what the industrial internet can mean to business productivity. It’s a new category for business, not just GE. We’ve put a lot of science and analysis into connecting with our customers and new tech partners in this area.  We’re doing much more in open innovation – meaning using digital communities to drive new methods at GE.  A recent example is a data science challenge with Kaggle that is shaving off minutes and fuel from flight landings – something thought unattainable.  And we’re having fun with Vine, having had a successful #SixSecondScience effort this summer that shows how science can be fun and connects with tech enthusiasts.

Drew: How do you stay close to your customers with so many different types of customers in so many countries?  
Beth: You have to live with them, analyze them, listen and empathize with them.  This means putting good marketing people on the ground in  markets around the world and more importantly, helping engineers and other business teams understand that marketing skills can be added to their jobs too.

Drew: Finally, I’ve heard it said that marketing is everything and everything is marketing especially when it comes to the customer experience. Do you agree with that notion and if so how have you extended the boundaries of your job beyond the normal purview of the CMO?   
Beth: I’m a big believer in Peter Drucker’s view that without a customer there is no business.  That is a rallying cry for marketing if I’ve ever heard one. And I think business leaders who believe that marketing is just about advertising and go-to-market communications miss out on all the market-making skills we have to offer.  I do believe the new frontier for marketers is holistic customer experience.  We haven’t cracked it yet but I’m looking forward to seeing how we can – and I think digital technology is taking us there very fast.

How Intuit Drives Innovation (and you can too)

Posted on by Drew Neisser

Small companies are often founded by innovative individuals who by design or necessity lead their business into new and unchartered territory.  As a company matures that innovative spirit is often squashed under the weight of a fearsome bureaucracy.  One company that seems to consistently break this pattern is Intuit, extending its product line well beyond Quickbooks and TurboTax with a steady series of innovative offerings including SnapTax, a mobile tax filing app.

Kaaren Hanson, VP of Design Innovation at Intuit, believes that the trick is “creating a culture of rapid experimentation” and is speaking about that very topic at next week’s Columbia Business School’s Brite ’13 Conference. As you will see in my interview below, Kaaren is refreshingly honest, reminding those that want to innovate (at any size business), to “fall in love with the problem, not the solution,” that today “leadership is about experimentation” and “innovation is part of everyone’s job.”  But read on. There’s a lot more to this innovation thing than grabbing a white board and gathering the usual suspects!

Drew: Are we currently in the “innovation age” or is innovation simply an imperative for companies looking to thrive (versus survive) in a rapidly changing global economy?   
Kaaren: We have a long way to go. I would say we are entering the “innovation age.” Changes in how we work and think are beginning to take place, but most of the results and impact are yet to come.

Drew: Can you share a specific recent innovation at Intuit and speak to how it came into being?
Kaaren: How about preparing and filing your taxes in less than 10 minutes on your smart phone? That’s a recent innovation from Intuit we call SnapTax. After announcing mobile as a key priority for the company, Intuit CEO Brad Smith was asked by an engineer in an employee chat: “What the hell does mobile have to do with taxes?” He told them he didn’t know, but he knew they’d figure it out. A few months later a small team had an idea.  Intuit gave this small team the freedom and the resources they needed to dream and develop – and they came up with a mobile app to prepare simple tax returns on an iPhone, easily and accurately. That team’s work became SnapTax, which makes it easy to file a simple tax return on a smartphone in the amount of time it takes to find a parking space at H&R Block.

Drew: Does creating a culture of innovation also require a certain tolerance for failure?  Are there ways to mitigate the risks?
Kaaren: Who likes failure? A string of failures and you’re out of business. You have to learn from failure and use it like road signs that direct you to success. Having a culture where people savor surprises is important.  That surprise could be a big upside or a big downside. Intuit’s co-founder Scott Cook says it well: “If there’s something that’s really a big surprise, upside or downside, that’s generally the real world speaking to you, saying there’s something you don’t yet understand.” It’s less about mitigating risks and more about carving out space for people to experiment and learn from failure. One example from Intuit is our Lean StartINs. These are one or two-day events where small groups of employees come to test their ideas for new products or services.

Drew: What are the other big cultural changes required for companies to become more innovative?
Kaaren: Leadership models need to change, especially when it comes to how decisions get made. In the innovation age leadership is much more about Thomas Edison than Dwight Eisenhower. Leadership is about experimentation. It’s no longer about the boss making the decision or judgment. Instead, we  make the decision based on testing the hypothesis and experimentation. This is moving decision-making from the boss’s opinion to enabling the answer to prove itself with customers voting with their feet.

Drew: Innovation often seems to align with the corporate growth cycle—younger companies tend to innovate more than bigger ones either out of necessity or because the culture is younger and less risk averse.  How does the proverbial old dog learn new tricks?
Kaaren: It starts with having a strategy that will fuel growth through big economic and technological changes. Then give employees the freedom to experiment, and ultimately bring to life those groundbreaking innovations that will inspire more innovation.

Drew: Can the big guys do this without creating “skunkworks” or other splinter operations that are not just empowered to innovate but are really required to do so?
Kaaren: At Intuit innovation is part of everyone’s job. If the big guys want to see new ideas come to life at their company, they should democratize innovation. We offer unstructured time to all employees at Intuit, to give great people with great ideas the time and freedom to pursue them. Having an innovation awards program is also a good way to celebrate successes and reinforce the importance of innovation. When it comes to our innovation awards program, we provide the three things that innovators wanted most: recognition allowing access to leaders and other innovators, time to innovate on a project of their choice and financial reward.

Drew: Henry Ford is famous for saying, “if you asked people what they wanted, they would have said faster horses” and Steve Jobs was also a skeptic of the consumer’s ability to recognize the need for what would become a totally new category. How important is consumer input/feedback in your innovation process?
Kaaren: Just listening to what customers say is a waste of time.  Customer Driven Innovation is one of our core capabilities that differentiates us and allows us to deliver solutions that truly change people’s lives. One of our signature methods is something we can Follow Me Homes, observing customers “in the wild” – it may be their homes, coffee shops, or the train.  We notice what and how they are going about their daily lives and then probe deeply to understand the motivations and emotions that drive their behaviors.  These nuggets provide rich material for our innovations.

Drew: Presumably Intuit has had some failures along the innovation road.  Is it true that you can learn as much from failures as you do successes and if so, what have you learned?  
Kaaren: You can certainly learn from failure. It goes back to my earlier comment about savoring surprises. We recently learned this important lesson: fall in love with the problem, not the solution.

Many of Intuit’s customers are small businesses. We had a team that had been exploring opportunities in adjacencies to our payroll business, and found that health coverage is the most important employee benefit. Yet most small businesses don’t offer this benefit because it’s too expensive and too much work to administrate.  The Intuit team took that customer problem and found a way to create a new, low-cost health insurance plan solution. The insurance plan got positive feedback from customers and good overall results in market testing. However, when the team began offering the plan, they only sold four plans in five months. The team then went back to drawing board. They again examined the learnings from customers and added some new members to the team with different perspectives. This led to the team taking insurance out of the solution. Instead, they created a health debit card product to which employers would contribute an amount that they set for their employees to use for healthcare expenses. So the employer sets the cost, and employees get full choice with pre-tax dollars.

A key learning from the failed low-cost insurance plan was, fall in love with the problem, not the solution. In this case the problem still existed. The team needed to have a mindset that as long as they understood the problem, they could be flexible, iterate further and in the end make a product more likely to succeed. The team continues to iterate, and the Intuit Health Debit Card is performing well in a limited market release.

Pivot Preview: Crowd-Sourced Finance

Posted on by Drew Neisser

Innovation doesn’t just happen.  It takes innovators; individuals and organizations willing to take a chance, to go out on a limb to try something new and unexpected.  One such innovator is Paul Wilmore, who as Managing Director of Consumer Market, is helping his organization, Barclaycard US, crowd-source product ideas like the new Barclaycard Ring.  I was delighted to catch up with Wilmore before he speaks at the upcoming Pivot Conference in NYC.

Drew:  Your Pivot topic, Crowd-Sourced Finance, is quite intriguing.  Can you give me a preview of the conversation you’re going to have with Brian Solis?
Crowd-sourcing can be used to take the guess work out of product development and traditional market research tactics. It’s a more interactive and intimate way to build a better product. That goes beyond just Finance but Barclays can leverage this new model to build better products and deepen relationships with our customers.

Drew: What role might a major financial institution like yours play in crowd-sourced finance?
I am hopeful this model changes the way financial institutions engage their customers, forcing them to build products that are simpler and more transparent and allowing the end consumer to be part of the solution not just a user of an end product.

Drew:   Is crowd-sourcing in some ways a threat to the traditional banking model?
Not a threat but a better way for consumers and financial institutions to work together.  Crowd-sourcing helps to take the guessing out for the bank and get right to the questions of what’s important to customers.  Financial institutions need to have the fortitude to be completely open and honest with their customers in order for this model to really work.

Drew:  Could crowded sourced finance have an impact on the credit card market?  If so, how might that happen?
It’s already happening.  You’re seeing issuers coming out with tools to put more control into the hands of consumers such as the online capability to re-structure a debt, change a payment schedule to ensure that a loan is paid down and set up auto payments.  Consumers have more choice in reward card redemption options – most programs now offer travel, cash back and merchandise.  And now with Ring, consumers actually decide jointly how it works.

Drew: Because of regulatory concerns, most banks have been reluctant to fully embrace social media.  Will the same trepidation apply when your competitors look at crowd-sourced finance? 
There is no question that banks have a long way to go in social media.  However, I’m pleased that my institution was willing to embrace social media for the launch of Barclaycard Ring and allow our team to have conversations with members of the community, answer questions frankly and share what’s happening with the program.  Today, our members review an updated, online profit and loss statement for the Ring card portfolio.  This is a big step for banks.

Drew:  Tell me about Barclaycard Innovation Lab.  Where did the idea come from and how has it worked so far?
The Barclaycard Innovation Lab was created as an initial step to invite consumers to help us co-create the launch of Barclaycard Ring.  We know it was very important to be in market quickly with this idea and get real consumer feedback (focus groups only go so far).  Six months after the initial crowd-sourced concept was pitched to the company, we were in market with an invitation only community, asking members to help us co-create the next evolution of the credit card.

Drew:  Since you launched the Innovation Lab in May, what has been the biggest surprise?  
The level of engagement of the community members.  Members are answering other members questions about the credit card and financial products in general.  Members are posting very thoughtful ideas around how the community concept and underlying products should continue to evolve.  Members have voted on product features and charitable organizations to support.  This level of engagement has been very strong and fairly consistent since launch.