It was Peter Drucker who said that "…the purpose of business is to create a customer, the business enterprise has two--and only two--basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs". If Drucker is right, it is marketing that creates today's money, innovation that creates tomorrow's.
Both marketing and innovation are having 'difficulties' in the current climate; marketing is rapidly becoming less effective at persuading customers to buy and invention (which is what much innovation actually is) has never had a good record of success in the market.
Part of the problem for marketing and innovation is that they work with too much of the wrong information or not enough of the right information. Marketing is blind-sided by too much historical customer transaction data and invention often ignores customer data completely. To succeed, marketing and innovation need a balanced mixture of information about customers. This includes data about historical transactions, about the context that surrounds purchasing, about those who influence purchasing and of course, about core customer needs in terms of the jobs they are trying to do and the outcomes they desire. Marketing’s job is to provide customers with products, services and experiences that customers can use to deliver these jobs successfully. Innovation’s is to create new, better or cheaper products to do the jobs in the future.
Maybe the recession will force companies to make their marketing more effective so that they can survive the recession and their innovation more productive so that they can thrive once the recession is over. Both are going to need a balanced scorecard of customer data.
Food for thought.
Tip of the hat to James Gardner at the very readable BankerVision [1] blog for stimulating this train of thought.
Graham Hill
Customer-driven Innovator
Further Reading:
Graham Hill, It's Time for a Balanced Scorecard of Customer Data [2]
James Gardner, Innovation Career Paths [1]