CMO Momentum 2017: How to foster innovation and drive business growth

From food retailers to a global specialist in energy management and automation, innovation is central to a company’s ‘state of mind’

From left: Freedom Foods' Tom Dusseldorp; Bulla's Nick Hickford; Schneider Electric's Chris Quinn; and SumoSalad's Lawrence Mitchell
From left: Freedom Foods' Tom Dusseldorp; Bulla's Nick Hickford; Schneider Electric's Chris Quinn; and SumoSalad's Lawrence Mitchell

Innovation means different things to different people. Is it iterative or disruptive? Is it marketing specific innovation or business model innovation? And with the rise of programmatic advertising, digital channels, and customer-led marketing, where does innovation sit in the increasingly complicated engagement equation? 

These are some of the ideas touched on by a group of marketing executives at CMO Momentum in Sydney, tasked with discussing the importance of innovation, its meaning and implications, and how it’s driving business growth in their respective industries.

When unwrapping the covers on innovation, one must first consider where an organisation sits in the overall lifecycle, according to Freedom Foods CMO, Tom Dusseldorp.

Dusseldorp was joined by fellow panellists, Chris Quinn, vice-president of marketing communications and digital customer experience of Schneider Electric Pacific Zone; Nick Hickford, general manager of marketing and innovation of Bulla Dairy Foods; and Lawrence Mitchell, chief customer officer of SumoSalad.

For Dusseldorp, innovation involves a multitude of factors including product, systems and technology.

“At Freedom, we like to say we’re building a business, not managing one. Innovation is critical to our growth trajectory in product, in systems, in technology, in everything that we’re doing, we’re constantly looking to use innovative solutions to drive the business bigger and faster and amplify that growth,” he said. “For us, it is completely ingrained in our culture. And without it, we can’t achieve what we need to in terms of the objective that we have as a growing business.”

Linking innovation to customer

Over at Bulla, Hickford said innovation is about improving customer experience and customer value.

“At Bulla, we’re in the process of reinvigorating and re-establishing the brand. So innovation has been really good for us,” he said. “Not just in product, but also in the way we do business. One of the trends we’ve observed, up until three years ago, was that price was the way to get growth in supermarkets. Today, it’s innovation that has been the way brands, and also retailers, have been driving growth year-on-year.

“From here though, it’s more about using innovation to improve the customer experience and also customer value. Obviously being a brand, we can speak a lot against private label at point-of-purchase. Innovation, within retail, is so advanced and so fast now that they can bring out great innovation in products quicker and easier than we can. So for us, it is about what can we do to surpass that and bring innovation and consumer experience so we can get ahead of the game.”

According to Quinn, innovation is about Schneider Electric staying relevant to evolving market demands and addressing shifting business models.

“It is about making sure that when we go to market, we’re doing it in a relevant way,” he said. “We’re finding the landscape is moving a lot at the moment, and it is going to move a lot more in the coming year, so we’ve got to be prepared to innovate and potentially disrupt our own business model to make sure we’re relevant to the people that we deal with on our way to market.”

At SumoSalad, innovation is thinking what’s down the road and addressing food trends, Mitchell said.

“We are 14 years old at SumoSalad. In terms of our journey and innovation, it’s about having the right culture in terms of creativity to support it and thinking one step ahead,” he said. “It’s about constantly doing new things, in terms of improving the consumer experience, keeping very close to the customer and really understanding the customer.

“That’s around food trends, but also thinking where things are likely to go in the future. There’s almost a divide between what I call incremental innovation [creating new recipes and new products], and step change innovation and thinking about how we can do things completely differently. That’s about trying to disrupt our business in the future and how to manage that internally.”

Several innovative products are on the boil at the company including MySumo, a personalised health platform, and SumoSociety, an open platform database where people can share content such as health insights and blogs specific to their needs or objectives.

“At the moment, we’re very much a transactional business,” Mitchell continued. “We have a platform and we have our stores. We’re heavily focused on retail at our stores around the country. While that is going on, we’re developing more of a technology platform to deepen our relationship and understand our customers in a much deeper way.

“SumoSociety has given us some great data and insights and helped us evolve new products and new solutions. Our most recent innovation, has challenged us is developing our own Sumo app. It enables our customers to ‘click and collect’ and get rewarded for healthy habits.”

The big learning from developing the app was that the company launched before it was ready. “There were a lot of skills that we didn’t have, but we pushed ahead and got it done. It was a great learning experience and very successful in terms of where we are now,” Mitchell said.

“One lesson to share about that is sometimes you can start with a goal that is too complex. It would have been better for us to start in a smaller way. We were quite ambitious at the beginning and got into a good place, but we probably used up more energy in the process than we could have done.”

More innovation in practice

Over at Schneider Electric, Quinn said the company has tried to introduce into a very traditional go-to-market structure some basic concepts of ecommerce in the last 12 months.

“It’s been a real learning experience for us being a B2B in a traditional space. We’ve had a lot of positioning and coaching conversations internally and externally to get our own people and some of our customers and partners prepared to get on the journey,” he explained. “At the same time, in terms of demographics, there’s a new generation of young electricians who want to do business in a completely different way. So there are these colliding forces we’re grappling with. It is very exciting, and a good challenge.”

At Bulla, the team has learned a number of significant lessons from its recent product innovation, Pure Cream. This simple concept created massive complexities in terms of coordinating messaging across multiple stakeholders, Hickford said.

“For the last 50 or 70 years, cream has always had something added to it. And so about two years ago, we decided we were going to make a genuinely pure cream,” he said. “Try taking something so simple as that and launching that in an environment where your staff on the factory floor, through to your management, and retailers that sell your product, all have an expectation you are going to make and deliver a product in a particular way.

“It is getting a mindshift through all of those different stakeholders and getting them onboard with doing something different that was the real challenge for us. Even right at the end, things didn’t work as well as we wanted them to, and we had to rethink and get everybody onboard really quickly.

“The learning for us from that was even when we're trying to do something so simple and so pure for the customer, and it comes from a really good space, you’ve still got to approach it like you would a major complex innovation project just to make sure you have everyone onboard.”

Freedom Foods, meanwhile, is on a massive product innovation spree, launching 40 new products in the next four weeks.

“We took the approach of not less is more, but more is more. But really we were behind,” Dusseldorp said. “As a food company, we were directed with coming to retailers with innovative food in the health and wellness space, the biggest growth trend in food at the moment. Everyone has some connection to health and wellness and yet we as a business and a brand were talking about what wasn’t in our food. We were saying it was free from that, free from everything, including taste. It was a hell of a challenge to reinvigorate the brand and the product range.

“In a sense, there’s not a lot of innovation - in fact, it is about simplifying, more than complicating. You’re having to train a whole new group of people about how to approach food.”

What was clear from all panellists was the biggest challenges hindering innovation comes at the people level.

“There are certain people that can survive at an organisation like ours and if you can’t, you go,” Dusseldorp said. “There is no ability to upskill a lot of people with the speed, the level of work, and the amount we have to get done. We have found there are many people that can’t go through with the journey.”

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, join us on Facebook: https://www.facebook.com/CMOAustralia, or check us out on Google+:google.com/+CmoAu  

 

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