Want Your Marketing Innovations to Pay Off? First Define Innovation.

Gartner defines innovation as the execution of new ideas that create value. This definition emphasizes three key elements:

1. Novelty: Innovation is born from a new idea.

2. Execution: Innovation puts new ideas into action.

3. A useful outcome: Innovation seeks to produce results that generate business value.

Based on this definition, newness is central to marketing innovation. However, even the concept of new is not as clear as it may seem, given the current use of the terms new-to-world, new-to-industry, new-to-customers or new-to-organization.

For example, Gary Thuerk, a marketing manager at Digital Equipment Corp., is widely credited with having sent the very first marketing email in 1978. This was a major new-to-world innovation for marketing that opened up a whole new channel. In 2018, Adidas incorporated augmented reality (AR) into the launch of its Deerupt sneaker, creating AR unboxing experiences. This adapts the applications of AR that furniture brands like IKEA have used to showcase products in real time. This is an example of a new-to-industry application of innovation.

Download report: The State of Marketing Budgets 2021

What is considered new and innovative in one set of market conditions also may not be considered innovative in another. For example, mobile contactless payment usage in Asia/Pacific is significantly higher than in North America or Europe — therefore, a standard customer mobile payment activity in China may be considered as still emerging in France.

Overuse of the word “innovation” can also lead to misuse and misinterpretation. For marketing, this creates a situation where projects and activities that aren’t innovative based on the Gartner definition are tagged as innovations. Common misapplications of innovation in marketing include:

• Copycat innovation — ”We should do that too to remain innovative” (the CMO saw [a direct competitor] running a campaign on TikTok).
• Upgrade cycle innovation — ”We need to upgrade our CRM software for a more innovative solution.”
• Hygiene factor innovation — ”Our replatformed corporate website will innovate the customer experience.”

These examples are instances where the application or solution may be considered worthy and valuable in a vacuum but isn’t delivering against marketing’s specific innovation mandate. This misalignment creates the following types of risks:

• Resource — Budget allocated to innovation is misdirected, putting future funding at risk.

• Strategic — Strategies that rely on innovation for success are placed at risk as initiatives fail to live up to the expected return on objectives.

• Credibility — CMOs that promise innovation, yet fail to deliver, risk their credibility and the credibility of the marketing function.

To ensure marketing innovation investments do not fall victim to risk associated with resources, strategy or credibility, CMOs should:

1. Build a clear definition and shared understanding of marketing innovation. This will rid innovation programs of ambiguity, minimizing the risk of innovation in name only.

2. Clarify the enterprise’s appetite for “new” by being clear about the difference between ideas that are new-to-world, new-to-industry or new-to-organization. This will help shape the volume of potential ideas that can realistically be explored and the resources required.

3. Educate the marketing team and stakeholders on the differences in potential risk and return offered by the different modes of innovation. As a rule, marketing transformation carries greater risk and greater potential for return than marketing optimization.

Recommended Gartner client* reading:

• The State of Marketing Budgets in 2021: Insights from Gartner’s Annual CMO Spend Survey

• Marketing Innovation Essentials – Part 1: Defining the Scope of Innovation

• Marketing Innovation Essentials — Part 2: Prioritize Innovation Programs Based on Risk and Return

*Note some documents may not be available to all Gartner clients.