Innovation models change

08 February 2011

NEW YORK: Major brand owners like General Electric, Coca-Cola and Unilever are adapting their innovation models, moves indicative of a wider trend in this area.

General Electric recently surveyed 1,000 executives in 12 countries, and found forging partnerships with pioneering entrepreneurs and organisations were now considered key goals.

"The rules around innovation are changing, and ... companies like ours will need to evolve our strategy," Beth Comstock, GE's chief marketing officer, said in a statement.

"For innovation to flourish, we must embrace a new innovation paradigm that promotes collaboration between all players - big, small, public, and private - fosters creativity, and emphasises solutions that meet local needs."

GE is an early adopter in this field having already run numerous schemes related to its Ecomagination clean energy drive, including the "Powering your home" programme, unveiled last month.

Soft drinks giant Coca-Cola has allied with mobile trade body the GSMA on the 2011 Brand App Challenge, asking companies and individuals to submit applications for its eponymous, Diet Coke and Coke Zero ranges.

Efforts from Denmark, Germany, Poland, Romania, the Netherlands and US were among the 15 finalists.

Tom Daly, group manager, strategy and planning, of Coca-Cola's global interactive marketing unit, argued the entries displayed both Unilever's "geographical diversity" and "creativity and imagination".

"Coca-Cola has always believed that innovation can happen anywhere," he said.

"The Brand App Challenge has allowed us to tap into the broad mobile application developer community and to discover new talent that we may work with in the future."

Consumer goods titan Unilever boasts previous collaborators like Italian designers Pinifarina, for the Signal Style Tech toothbrush, and Cynosure, when making handheld devices treating acne and hair removal.

"We work in R&D with professional research labs and our own internal development teams," said Keith Weed, Unilever's chief marketing and communication officer.

"But we also do what's called 'open innovation', where we encourage people to come forward with ideas. We supplement the work that's done by the labs and our teams."

It has extended this idea to marketing, holding the Consumer Creative Challenge in 2010, requesting entrants offer their own ads for 13 of the firm's brands.

"There's a huge opportunity for people who want to engage with our brands, and for us to create more economically based content for the future," said Weed.

While disrupting category norms, Weed suggested advertising agencies should not feel threatened by these tactics.

"I'm a great believer in ad agencies, and a great fan of them. They generate the true creative leaps and are custodians of our brand equity," he said.

"I don't think it's a case of one or the other, nor do I think that crowdsourcing will have an impact on them. I see it as a form of open innovation."

Procter & Gamble, Unilever's rival, has established the Connect + Develop platform, seeking to ensure 50% of new products are yielded from external providers.

Among its most successful projects is The Swiffer, a disposable duster delivered through a tie-up with Unicharm, and Olay Regenerist, when French operator Sederma occupied a leading position.

However, it is also attempting to enhance the role of small-and-medium-sized enterprises.

"SMEs are the fastest growing source of intellectual property. They are a gold mine of innovation opportunities," said Chris Thoen, P&G's director, innovation and knowledge management.

Data sourced from General Electric, Coca-Cola, Marketing Week, Inventors Digest; additional content by Warc staff