Innovation Can Be Risky Business
Innovation is sometimes necessary for market leaders to either maintain or grow their business. Unfortunately, innovation can be a risky business. See why below.
Innovation Can Be Expensive
Research, development and testing of a new product or service can take a great deal of time and money and you cannot always guarantee that your new product or service is going to be a hit with consumers.
Let’s examine one product that is currently being tested by approximately 1,000 people that Google selected. The product is called Google Glass.
This product is essentially a wearable computer with a built-in video camera, microphone and heads-up display that looks like a pair of glasses.
On the surface, this product sounds like a niche item with some potentially great uses.
If, however, you take the time to look for the potential abuses all kinds of questions about invasion of privacy pop into your head. How would I know whether the person I was chatting with was recording an audio of our conversation or even videotaping me while we were talking?
Can the glasses be set to record audio or video when they’re not being worn?
If the glasses are a computer that is connected to the Internet, how easily could their security be compromised and used for purposes such as identity theft?
The heads-up display brings up the question of safety because the person that’s wearing those glasses may be so immersed in a YouTube video or social media conversation that they aren’t paying attention to what’s going on around them in the real world.
A distracted person is much more likely to be injured or to cause an injury than someone that isn’t distracted and I would definitely think that wearing a computer that’s built into a pair of glasses with a heads-up display would qualify as a big distraction.
Innovation Can Be Very Profitable
The iPad is a good example of an innovative product that has become very successful. This product has generated billions of dollars for Apple and their competitors that chose to get into making tablet computers.
This product has become so successful that more tablets were sold in 2013 than desktop computers or laptop computers.
An innovation does not have to dominate the marketplace or even create a completely new niche to be highly profitable. It does need to satisfy a need and it does need a crowd of hungry buyers that want that problem solved.
Before you try to create something that’s never been created before, you need to do some very good research on the risk versus the potential rewards. If your assessment is wrong, you can spend a lot of time and money on something that will never yield a positive ROI.
Market leaders are very good at figuring out what their customers want and need before the consumer realizes the want or need exists but they aren’t infallible and they do occasionally guess wrong.
Do your research, do your market studies, do your research and development then lead your industry and your customers in new directions when you think it will help everyone involved, especially your business and the consumer that is benefiting from your efforts.
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