Culture innovation: Triumph of a better ideology
by Douglas Holt and Douglas Cameron
Market innovation has long been dominated by the world view of engineers and economists - build a better mousetrap and the world will take notice. But Douglas Holt and Douglas Cameron argue the merits of cultural innovation instead.
This functional point of view certainly has merit. But, because it is the only way that we approach innovation, the "better mousetraps" approach has had the effect of eclipsing a very different innovation world view - champion a better ideology and the world will take notice as well.
The Cultural Entrepreneurs
While the food scientists were struggling to make odd-ball mix-and-match drinks combinations, cultural entrepreneurs were playing an entirely different game. They pursued radical innovations in culture, not product.
These businesses have been every bit as innovative as the technological and mix-and-match businesses celebrated by innovation experts. But what was radical about them was what the product stands for - its ideology, which, when staged through myth and cultural codes, becomes a distinctive cultural expression.
Furthermore, many technological innovations can benefit from innovative ideology as well. Cultural innovations have turbocharged many better mousetraps including Apple, Google, Mini, Red Bull, JetBlue, and Wikipedia.
We might expect that the discipline of marketing would play a leading role in the development of strategy for cultural innovation. Yet, conventional marketing – what we term mindshare marketing because it is couched in psychology – emphasises the day-to-day stewardship of existing businesses and, in so doing, slights cultural innovation.
Mindshare marketing relies on an easy and intuitively appealing metaphor: brands succeed when they colonise valued ‘cognitive territory’ in consumer minds.
Depending on the company and category, today’s mindshare strategies focus either on ‘functional benefits’ (sometimes termed ‘rational benefits’), or on ‘emotional benefits’, or on both.
- Functional benefits trap
- Commodity emotions trap
The Functional benefits trap
The model directs managers to determine the cognitive ‘gap’: which functional benefit in a given category is most valued by consumers and least dominated by other brands? Targeting the gap, the marketing goal is to stake out a claim to the cognitive association in consumers’ minds, then hammer home the connection between the trademark and the benefit claim as simply and consistently and frequently as possible.
Over time, according to the theory, consumers would unconsciously associate the brand with the benefit, and as a result the brand would come to ‘own’ (in a cognitive sense) the benefit.
The functional benefits model is most useful when a product really does command a novel functionality that gives the brand a substantial and durable advantage over competitors. In such instances, the mindshare model simply reinforces what economists have been preaching about reputation effects for decades. Such advantages, however, are hard to come by, and, when a new technology with a truly improved performance is introduced, it is summarily copied by competitors.
The Commodity Emotions Trap
Unfortunately, the new style of mindshare marketing has proven to be more problematic. To avoid the functional benefits trap, many marketers now focus on identifying what they term ‘emotional benefits’, which are the softer values, thoughts, and feelings that consumers associate with the product, brand, or category.
Although the intentions may seem noble and sophisticated, ‘laddering up’ to the
consumer’s ‘higher order values’, or ‘probing deeper’ to unveil the consumer’s ‘fundamental need-states’ and the ‘brand truth’ is anything but that.
In practice, the result is simply to push for vague abstractions that hold a negligible value for consumers. At least functional benefits forced marketers
to remain grounded in the product’s material performance. There are no constraints at all for emotional benefits: all emotions are fair game. We are witnessing an emotions ‘arms race’ in which companies vie to own one of the shortlists of top emotion words.
This process encourages companies to pursue generic ‘emotional territories’ that any brand in any category can claim.
While the pursuit of emotional benefits has helped many a brand manager
avoid the functional benefits trap, the unintentional consequence is to land in
an even more strategically bereft space – what we term the commodity emotions trap. Emotional benefits render the brand even less distinctive, from a consumer’s perspective.
As with the functional approach, emotional branding drives brands to mimic the cultural orthodoxy of the category. Mindshare marketing not only limits innovation, it creates red oceans.
Psychology to Blame
Ultimately, both the functional and emotional benefits tangents of mindshare marketing are severely limited as innovation tools because they are rooted in psychology. Both approaches imply that marketing is about embedding associations between brand and valued benefits in consumers’ minds. As a property of mind, the brand and its benefits are both assumed to be durable and contextless.
Mindshare marketers’ favoured terms for a brand’s key benefits – brand essence and brand DNA – reflect this assumption. Because the strategic core of the brand has no connection to society or history, mindshare marketers push the job of making their brands resonate with consumers onto their creative partners.
They are charged with injecting some ‘trends’ or ‘fame’ or ‘cool’ into the brand in an effort to make it relevant. Conceiving of brands as a phenomenon of the mind – rather than of society, culture, and politics – means that opportunities for innovation created by historical changes in society are totally ignored.
Brands are rooted in culture
People always want better functionality. Ideological opportunities, in contrast, are produced by major historical changes that shake up cultural conventions of the category, what we call a social disruption.
These shifts unmoor consumers from incumbent brands, and prod them to seek new alternatives. It is an emergent kind of opportunity that is specific to a historical moment and a particular group of people.
Likewise, the cultural innovations that respond to these opportunities are fundamentally different from better mousetraps. They are composed of specific cultural expressions, which are conveyed by the brand across consumer touchpoints.
Powerful cultural expressions can be dramatised via product design (Ben
& Jerry’s, Starbucks, Vitaminwater), print ads (Jack Daniel’s), guerrilla stunts (Ben & Jerry’s, Fuse), corporate business policies (Ben & Jerry’s, Fat Tire, Freelancers Union), retail design (Starbucks), packaging (Starbucks, Vitaminwater), the service encounter (Starbucks), naming (Vitaminwater), outdoor media (Freelancers Union), and television ads (Nike, Marlboro, Clearblue, Fat Tire, Levi’s, ESPN). All touchpoints are fair game for cultural innovation.
Can cultural innovation become a systematic pursuit? We have learned that it can. For the past decade we have engaged in a ‘cultural innovation laboratory’ of sorts: we conducted academic research on dozens of these successes while also consulting to a wide variety of companies to develop cultural innovations for them.
The result is what we call cultural strategy: a six-step cultural innovation framework supported by a systematic toolkit of cultural research methods.
Ideological opportunities provide one of the most fertile grounds for market innovation. Yet, these opportunities have gone unrecognised because of the extraordinary influence of economics, engineering, and psychology on management thinking. These disciplines, as different as they are, share a common assumption – in order to simplify the world, they purposely ignore cultural context and historical change. These theories remove all the messy bits of human life in order to present a tidy theory that is easy for big companies to work with. We argue that it is in these untidy hard-to-measure parts of social life that some of the greatest innovation opportunities lie.