Whether co-opting outsiders into helping you innovate as NASA does or getting creative with your ethnographic research as Moen did, we are seeing more and more members reaching out to their customers – and even their non-customers – for innovation help.  Already NASA’s Centennial Challenge Program has resulted in technological breakthroughs orchestrated by a “regular guy” from Maine working alone in his dining room as well as a group led by an undergraduate student at Worcester Polytechnic Institute.

Of course, just opening your doors to the outside world isn’t going to be a panacea that cures your innovation ills.  While we are seeing lots of companies succeeding via social media platforms that engage customers in idea sourcing (see examples from Starbucks and Dell), the best marketers are leveraging their “specialist users” over their “mass customers” to drive real breakthrough thinking.  From automotive companies to commercial paint manufacturers, we’re hearing more and more about the pursuit of customers with a unique skill set or unique need state that open more doors to innovative thinking that traditional research approaches – even one company that has successfully recruited “haters” of their products.

MLC members, are you curious about how the best companies identify and co-opt their specialist-user customers to jump start real innovation? Join us for more on this topic by attending one of our half-day Innovation Summits.  The next session, on July 22, is being hosted by W.L. Gore, makers of GORE-TEX, and will include a tour of their world-class innovation center (40 minutes outside of Philadelphia).  Curious about how your innovation efforts stack up against your peers?  Take our innovation diagnostic and find out.

Granted, I was probably a little outside of the target segment for most wine makers, but what would have altered my decision? A catchy label or even a suggestion from one of the sales people could have nudged me in a different direction. The lesson for me here: while there is immense opportunity to influence a brand decision before a consumer goes shopping, the importance of the in-store experience—whether through product placement, point of purchase signage or a well trained store employee—cannot be minimized.

According to a recent study from the Grocery Manufacturers Association, Booz & Company, and SheSpeaks, shoppers choose 59% of the brands they buy in the store. Of those items, 85% of shoppers perceive in-store factors as more influential than out-of-store marketing. After price, communicating benefits on packaging is most influential, whether to reinforce existing brand preferences, drive competitive switching, capture purchase when there is no strong brand preference, or create impulse sales. In fact 77% of shoppers do not take detailed shopping lists into the store. Instead, they use “mental lists” that include “brand consideration sets,” but evolve as they are exposed to more marketing at home, in transit and in the store.

This probably explains the surge in interest from MLC’s membership on Shopper Marketing. We recently hosted a round robin discussion with a few of our CPG members to discuss the future of the function.  We discussed questions such as:

• Where should Shopper Marketing sit within the organization? (Centralized Under Sales / a Center of Excellence / Centralized Under Marketing)
• What skill sets should we look to hire and develop?
• What are the right metrics to measure our performance?

MLC Members, We’re also seeing increased interest from retailers to partner with manufacturers on Shopper Marketing. Look out for more discussion groups from us in early 2010. In the meantime, please email me if you want to see the key takeaways from our most recent discussion group.

Most marketers are relying on price and promotional shifts to re-position their brands for value.  By contrast, savvy marketers are re-assessing their products more holistically, taking into account how raw materials and production costs interact with traditional marketing disciplines like consumer understanding and pricing.

Enter Macaroni Grill, which reported in The Wall Street Journal | Sep 16 is reworking its menu to get away from 1,000 + calorie items—its consumers want to eat more healthily.  The restaurant’s tomato bruschetta appetizer makeover illustrates recession-minded innovation at its best: 

• Reduce olive oil dressing—drive down a costly input
• Put in better tasting cherry tomatoes + small leaf basil— recover the flavor loss from reduced olive oil with these stronger tasting (but cheaper) substitute ingredients
• Serve tomatoes in a bowl on the side—reduce labor that goes into getting those pesky little tomatoes to balance on the bread.  Leave that challenge to the consumer, many of whom actually prefer having extra control.
• Drop price by about 6%–fantastic! Just what our wallet-riven consumers need in this recession.  Maybe that’ll help you pull off a Panera Bread, and catch consumers drifting out of more expensive alternatives.

All of this, and calories cut by 36%, in keeping with consumer preferences for healthy (okay, healthier) eating.

Some marketers do this sort of multi-variable swapping by zen (less charitably, you might say its by gut).  But we’re seeing marketers bring real science to making these swaps.  They’re building “consumer value equations” by using conjoint analysis and vector analysis.  Conjoint in marketing isn’t new, per se.  But it’s typically applied only to functional attributes and price.  We see marketers applying it to emotional attributes, as well.

With this approach, you can with confidence reduce that olive oil and replace it with small leaf basil, because you know consumers won’t mind that.  You can serve the tomatoes in a bowl on the side, but you can’t CUT the quality of the tomatoes.  In fact, all the better if you can increase quality of a critical ingredient.

This kind of recession-minded innovation is replicable by most companies.  Think through the interdisciplinary dimensions of your own products— are there any tomato-bruschetta opportunities in your portfolio?

MLC members, take a look at this short case study on consumer value equations to learn how to how to re-engineer your product offering.  Or Access our best tools and insights on NPD and Innovation.