These Five Companies Are Reinventing Their Propositions. Here’s How — Innovation in 5
By: Miranda Essex and Guerric de Ternay, Inventors at ?What If! Innovation
Traditional products, brands, and services often fail to adapt to rapidly shifting consumer needs.
The tension between needing to protect a formula of success, whilst reinventing and reinvigorating it, is often difficult to manage. Here, we look at 5 leading companies who’ve achieved this delicate balance.
1. How many flavours of KitKat are there in Japan?
KitKats are doing so well in Japan that Nestle is opening a new factory there. It’s the first in 26 years. KitKats are Japan’s favourite chocolate treat, and come in 300 different flavours–from Green Tea and Wasabi to Cherry Blossom.
This is an interesting example of adapting a popular product to a distinct market with a particular taste. Rather than launching traditional KitKats, which are created with Western consumers in mind, Nestle understood the need for cultural specificity. It reinvented its products to capture the Japanese market.
2. Disney adapts the way it delivers entertainment
Disney has decided to pull its films from Netflix in order to shift its business model and build its own platform. In early 2018, it will launch an ESPN sport streaming service, as well as its own branded streaming platform in 2019.
Traditional content creators are under intense competitive pressure, mostly from tech companies who have proven they can create trending content like House of Cards. The only barrier to entry is having lots of cash. Netflix is spending $6 billion on content this year, and Amazon, Google, and Apple are following.
Disney’s great portfolio could make it one of the only content creators to have enough brand appeal to go it alone.
3. Brands with a conscience gain Unilever the edge
Unilever’s Sustainable Living brands have grown 50% faster than others in its portfolio. Well-known favourites like Ben & Jerry’s, Dove, and Hellmann’s delivered more than 60% of the company’s growth in 2016. Reimagining their proposition has resonated with consumers, particularly a younger audience.
Young people actively seek out brands which are purpose-led. According to research, more than 90% of ‘millennials’ will switch brands to one associated with a cause.
Cost savings from sustainable practices, as well as increasing government and social pressure, means that social innovation is increasingly on the agenda for large corporations. New social business models such as B corps are becoming increasingly prevalent as companies explore new ways to deliver social as well as commercial value.
4. Air France adapts to allow ‘millennials’ to fly in a different way
Joon will be a new airline-inside-an-airline geared towards anyone born after 1980. It will be “aimed at a young working clientele, the “millennials”, whose lifestyles revolve around digital technology,” a statement said.
This is an attempt from Air France to adapt its proposition in order to please a specific segment, but we don’t think it is a good way to get under the skin of their target consumers. Airlines do need to update their offering, but demographic segmentation without insight into behaviour and motivations is a poor way of doing it. What’s more, ‘millennial’ is a notoriously vague term. The segment doesn’t capture real insight about the people it describes.
5. Instagram continues to steal consumers from Snapchat
The rise of Snapchat over the last couple of years has made Instagram look like an aging incumbent, especially to younger users.
But Instagram’s product teams reacted quickly. With a clear vision in mind, they improved their already popular offering by copying some of Snapchat’s features that users really value, like stories and face filters. Their most interesting move is the experiment with one of its most recent feature called “favorite”, which allows users to share photos to a small group of friends.
Instagram is redefining itself, moving from a public interest-led platform (based on hashtags) to a more social one (based on friendship). In this way, it is becoming more like Facebook and less like Twitter.
If you’d like to know more about our approach to reinventing propositions, please contact us at Guerric.deTernay@whatifinnovation.com and Miranda.Essex@whatifinnovation.com. Follow us on Twitter @Whatifglobal.