INNOVATING IN A new and competitive industry is critical. Whether you are first to market, last or somewhere in between, innovation must be a pillar of your business strategy.
When competition is fierce, companies fight to stand out and grab consumers’ attention along with their share of the market. When companies lack innovation, they often get stuck trying to be the lowest priced option. This isn’t sustainable for most smaller-sized businesses. Price wars can be especially detrimental to a smaller company competing with a larger entity that has automation and economies of scale on its side.
Innovation is the key to avoiding this path and thriving in the market with strong margins.
Innovation is a friend to companies of all sizes. It doesn’t care when you arrived in the market. Large, established companies must be innovative to stay ahead of the throng of smaller competitors dissecting their moves and improving upon their models. Smaller, newer businesses need to be innovative in examining the market as well as the weaknesses of their competition to find their best point of entry.Advertisement
How to Know How to Innovate
As a first step in getting more innovative, it’s important to understand the areas of your company that impact innovation. You’ll want to map out and assess your company’s history, its place in the market, its internal and external culture and the degree of competitiveness in the location in which it operates.
Understanding these and other layers of the company will allow you to tailor your innovation roadmap to best suit your company. There is no “one size fits all” approach to sparking and creating innovation.
The next step is assessing the overall state of the market and asking relevant questions such as, “What are consumers after?”, “What has worked and what hasn’t … and why?” and “What is missing from this market?” In a nascent market, there is a large degree of turnover as companies innovate, create and refine in response to consumer engagement with their offerings. The companies with the strongest advantage in these market stages are the ones who can act fast and be more nimble.
Depending on a company’s experience, capital and bandwidth, an innovation roadmap starts to unfold. Here are a few avenues for learning more about where you need to innovate:
- HIRE AN INNOVATION OFFICER. If you have capital that allows for it, an innovation officer dedicated to watching market trends and staying ahead of them can be tremendously advantageous. Just make sure you have the resources needed to execute on strategies and a team willing to test and optimize as needed to recoup the investment.
- RESOURCE YOUR NETWORK. Are you operating with a smaller budget? Don’t be afraid to ask others in the space for help. If they don’t directly compete with you but have expertise in the area you want to innovate in, reach out. Generally, people are willing to network and share knowledge.
- LOOK TO LATERAL INDUSTRIES. In cannabis, we have hops and tomatoes. Much of the time we aren’t necessarily needing to reinvent the wheel and can adapt innovations that have already been found in lateral spaces.
- RESOURCE EMPLOYEES. Ask employees for their ideas and feedback. They know your company and are often also consumers of your product. Your own people are a great resource for new, game-changing ideas.
- ASK THE DECISION MAKER. Last but certainly not least, ask the person who is pulling out their money – your customers. What would compel them to prefer your product or service over another?
Focused Innovation Adds Maximum Value
Next, a clear assessment of the company’s value proposition is needed. To start, a company should narrow its focus on innovating where they hold the most value proposition. Once the goals in that area have been achieved, expanding innovation to other categories should be sought. Here are some different ways a company might innovate, based on their value proposition focus:
- SERVICE. How can you use technology and data to bring a better customer journey to those you serve?
- PRICE. How can you leverage automation and other efficiencies to set competitive prices while maintaining healthy margins?
- QUALITY. How can you elevate the quality of your products beyond your competitor’s offerings?
- NOVELTY. How can you understand consumer needs to bring new solutions to the market?
Innovation isn’t rocket science. It’s easiest to accomplish by starting with the needed solution and reverse engineering a way to get there. Identify the parts of the equation you can’t change and start toggling the variables you can until you have a great idea ready to execute.
Cannaconvo with Peter Su of Green Check Verified
Cannabis Last Week with Jon Purow interviews Peter Su of Green Check Verified. Peter Su is a Senior Vice President with Green Check Verified, the top cannabis banking compliance software/consultancy in the space. A 20+ year veteran of the banking industry, Peter serves on the Banking & Financial Services committee of the National Cannabis Industry Association. He chairs the Banking and Financial Services Committee for the NYCCIA & HVCIA. He is an official member of the Rolling Stone Cannabis Culture Council. And, he is on the board of the Asian Cannabis Roundtable, serving as treasurer.