Category Archives: Innovation

How We Became A Software Company: 5 steps to the birth of Pulsar

“We all need to become software companies!” That’s the message from John C McCarthy in his latest Forrester Research report which in a nutshell proposes that software is a central driver of brand and financial growth.

In his post earlier this week, our CEO Andrew Needham discussed the “business of products” and how to build them, touching upon ‘Lean Startup’ methods and Marc Andreesen’s quote that “all companies are now software companies”.

The big question you are left with is how the heck do you become a software company?

At FACE, we’re now a software company (as well as a research & innovation firm). Many of you reading this will have followed our journey over the past 5 years, culminating in the 2013 launch of Pulsar, a SAAS (software as a service) social data intelligence tool.

In this blog post, I want to share how we did this.

Why? As an innovation consultancy, we’re advising brands every day on how to build products and services. Yet unlike almost every other company in this space, and even many product design firms, we have first hand experience of building products ourselves – one that’s succeeded at scale, growing seven-figure sales revenues in its first year. The story of how we built Pulsar is inscribed deep in the DNA of what FACE is as a brand, and it’s a story we want to tell much more powerfully going into 2015.

Pulsar Social Data Intelligence-01 (1)

Pulsar social media monitoring platform Bundle data visualisation

So here’s the first installment: 5 ways we turned ourselves into software thinkers.

1. We challenged ourselves to do our jobs better 

As researchers with a passion for technology we were early users of social analytic software and we quickly learnt the limitations of the tools in the market. As part of a research innovation exercise, the team led by Francesco D’Orazio identified the key areas where we had to develop manual workarounds on client projects such as topic, network and audience analysis. A lightbulb went off when we looked at the results, which showed we could both reduce the amount of time spent on analytics and improve the quality of our work if we could automate these steps. Then we realised that no tool was offering this…

2. We became obsessed with other people’s jobs

We then looked outside of our company and our own jobs as researchers, and set about evaluating which other jobs could be improved by a tool that could automate these analyses. It was a long list: social media marketing, PR, brand management, corporate relations, advertising agencies, financial forecasting, media planning…And so on. It started to look like a viable market opportunity.

3. We started to build 

Looking outside and seeing the opportunity to improve jobs across so many industries gave us the confidence to start the pilot build of tour own social analytics product. For 18 months we built Pulsar with a small budget and team, working all the time with our clients to pilot a wide range of research projects to understand needs, features and use cases. Without having a research team in house who served as ‘internal customers’, this “listen to your users” process would have been much harder and much less powerful. To our delight, after 18 months, a lot of hard work and development, we had happy clients, happy researchers and most importantly a working product prototype – which we named Pulsar.

4. We thought BIG…

In the summer of 2012 we were so excited by the prototype of Pulsar that we started to think big. What if we scaled up the product? What if we could sell this to other companies and work with them on an ongoing basis?, What if we could sell this to lots of people all over the world doing lots of jobs? We then developed a plan to turn Pulsar into a leading platform for social intelligence. In 2013 we rolled out our big thinking by creating new teams in the company under the Pulsar brand: product, development, sales, marketing and account management. Now we really were a software company.

5. …But fought to stay Agile

After 18 months of launching Pulsar and hundreds of clients later what we have learnt about being a software company? It’s really incredibly simple: to win and keep customers as a software business, you have to be obsessed about how you can make your customers’ jobs better – and you have to keep innovating. Our development team follow Agile ‘scrum’ methodology, working on a rapid response development cycle where every aspect of development — requirements, design, and so on — is continually revisited and recalibrated to ensure it’s both deliverable and meets customer needs.

Agile software development principles

Principles of Agile software development

But it becomes something we’ve embraced deeper into the business too.

We’re developing continuous delivery research models, delivering social insights not just through big category landscape reports but also monthly newsletters & the Pulsar dashboard itself.

We passionately believe that “business people and developers” – that is, clients and customers, brands and consumers – have to work together to create products of value, and that’s why we still champion co-creation.

And our version of “working software” is actionable, direct recommendations that provide very specific guidance for what to do and how to change your product or brand.

So that’s how we built Pulsar – and changed ourselves as a research business in the process.

If you’d like to talk further about how we can change your business, whether that’s service design or new product development or just a difficult problem you need to solve – send me an email: Job.Muscroft@Facegroup.com

Previous post: Andrew Needham on How to Succeed in the Business of Products

How To Succeed in the Business of Products

Brands are changing.

Perceptions of a brand are increasingly measured on whether they deliver against the product and service expectations we have for them. Online resources give consumers vastly better product information – from peer reviews to price comparison sites – meaning that their purchase decision-making can become a much more rational assessment of real value (Simonsen & Rosen, 2014 ) And apps such as Uber – or more broadly ‘Uberfication ’, the growing sector of on-demand mobile service provision – have created new and much higher expectations for how easy and frictionless a service can be.

So what a brand does via its products and services is now much more important to customers than what it says.

Marketing has to change radically – but customer understanding is only more essential. So here are some initial first steps to building great products that your customers will want to use.

Uber

Start with the customer

Today’s empowered, social, networked customers are not just “always on” but “on demand” – hence the need for companies to put them at the heart of everything they do. Staying close to customers and understanding their needs in real-time is critical to delivering winning products and services.

Within this, as Alex Osterwalder sets out in his book ‘Value Proposition Design’, it is important to understand:

  • what CUSTOMER JOBS they are trying to do
  • the GAINS – the outcomes customers want to achieve or the concrete benefits they are seeking
  • and the PAINS – the bad outcomes, risks and obstacles related to the customer jobs.

Ranking these three elements in terms of priority is the first step to ensuring that you focus on those needs that the most of your customers care the most about. 

Ensuring “Fit” with your valuation proposition

The flip side to understanding your customer profile is ensuring that there is a fit with your value proposition.

Start by creating a value map of how your product/service helps customers alleviate pains and create gains, then rank these by importance, says Osterwalder. You achieve “fit” when customers get excited about your value proposition because it addresses important jobs, alleviates extreme pains and creates essential gains that customers care about the most. Achieving this fit is hard to find and maintain so having a rigorous process to ensure this is essential.

According to Des Traynor from Intercom, here are 10 important questions and principles to keep in mind when thinking about your product road map:

  1. Does it fit your product vision?
  2. Are you improving or innovating an existing feature in your product?
  3. Are you focusing on the areas that get the job done better by 20-30%?
  4. Are you getting more people to use the product and to do so more often?
  5. Will the feature matter in 5 years?
  6. Focus on the things that don’t change
  7. Does it benefit all customers not just a few? Sometimes new features only divide existing usage
  8. Watch out for side effects
  9. If a feature takes off can you afford it?
  10. If you can’t do it well, it’s not a good feature

Integrating lean start up principles

Erik Ries and Steve Blank’s work on the ‘lean startup’ was inspired by ideas of ‘lean production’ developed by Toyota, but pulls them from manufacturing into the world of consumer product and service design. They propose a 3-fold model:

  1. Hypothesise how you product will create value for its users
  2. Listen to users: Get feedback on every aspect of your product & business model & revise your assumptions
  3. Practice ‘agile development’ by developing incrementally and iteratively

[Source: ‘Why The Lean Startup Changes Everything’, Steve Blank, HBR May 2013]

Blank’s process eliminates slack and uncertainty from product development by continuously building, testing and learning in an iterative process. This approach is key to providing evidence that your customers care about how your products and services kill pains and create gains. Building a range of hypotheses and different experiments to test them in regard to your value proposition is essential to reducing risk and uncertainty and increasing the likely success of the product launch.

At FACE our inverted co-creation model is one of the ways in which we help brands do all of the above with rigour and speed, building the customer’s needs into every step of the product development process.

Inverted Co-creation funnel

Embracing social technology and software

Finally, in all of this social technology and software has a huge role to play in the “Business of Products”. Developing products that can help brands and companies meet the demands and expectations of today’s customer cannot be done without a deep understanding of technology.

As Steve Denning wrote on Forbes.com in his article entitled “Why Software is eating the World (a title taken from Marc Andreessen’s own article by the same name in 2011): “All Companies are now software companies,” and for most of them, “failure to acquire digital agility will be an existential threat and so, establishing digital agility has become in effect a strategic necessity.”

Software is not just disrupting traditional business models by helping new entrants meet customer needs better and faster – it is helping the new entrants to re-define them. As I indicated at the start of this post by mentioning “Uberification”, what Uber shows is that even so-called ‘offline’ products and services (such as taxis) need to become apps, and are defined by the digital user experience they offer.

At FACE we don’t just advise companies on product development. We’re doing it ourselves with the development and scaling of Pulsar, our social data intelligence platform.  We have fused software engineers and data scientists together with own innovation and research expertise to revolutionise social media research. We are seeing first hand what it takes to apply the “business of products” and are now focusing on delivering the next stage “the business of platforms”.

That, though, is a topic for another blog!

If you would like to find out how we can help your company innovate, then please get in touch by emailing: andrew.needham@facegroup.com

What makes a “copycat” brand original?  

Since our last post about Xiaomi’s innovation approach in China , the mobile phone manufacturer has come under the spotlight once again – but this time the sentiment is not positive. After the launch of the Mi4, Xiaomi has sparked criticism that it is nothing but a copycat of Apple.

Screen Shot 2014-10-07 at 12.00.42

Xiaomi’s CEO Lei Jun, wearing a black T-shirt and blue jeans, used Apple’s iconic “one more thing…” slide in the Mi4 launch event in July.

It’s not uncommon for Chinese brands to be criticized for “copying” or “improving” innovations from around the world. What is irksome for some, and perhaps admirable for others, is that they seem to do this really well.

No matter which camp you fall in, there’s a lesson to be learnt from China’s “copycat” approach and this begins by exploring what winning “copycat” brands have done differently.

Some key questions to ask:

The more I researched this topic, the more I was intrigued by it. Indeed, there’s an art and science of skillful copying that involves a careful combination of traditional thinking, social, political and technological development. From this, there are 3 particularly intriguing questions that emerge:

Is originality aspirational?

In the West, being original is king. Yet, imagine what it’s like to have grown up in reformed China. Since the country opened up, Chinese consumers have been exposed to new brands and new products on a daily basis. In a culture where everything is so new, is being original really that fundamental to a product’s success and aspirational value?

Is originality necessarily relevant?

We are at an age when innovation is celebrated everywhere, and China is no exception. However, thinking of a lot of innovation in China – many products are actually developed elsewhere in the world and then being introduced or at best adapted to China. When innovation is not developed with Chinese consumers in mind, how well can itserve their needs?

Does originality drive perception of quality?

In the past, people thought that original brands were of better design and superior quality. However, with the development of technology and skills in China, a lot of the “copycat” brands actually emerge with a similar if not better quality as the original product. In a culture where choosing a copycat product doesn’t mean a compromise on quality, what superior claim can an original product/brand claim?

While there is no hard and fast answer to the above questions, one thing is certain – innovation in China works on its own rules and won’t be dictated to by the West.

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The strapline of WeChat – “WeChat, it’s a lifestyle”

Let’s take a look at WeChat…

One of the brands that thrives under the copycat label is WeChat. When WeChat first started, it was viewed as a follower of Whatsapp and many other messaging apps in Asia. Indeed, the basic features that it was launched with, e.g. push-to-talk, emoticons, and “moments” (a feature similar to “status” available in other social networks), were “copied” from other social media apps in Asia such as Talk Box, Path, and Weibo. [source]

However, as WeChat continues to develop, it has innovated into more than a messaging app, but rather a platform that delivers services tapping into different aspects of life among Chinese consumers, e.g. [source]

  • a mobile news provider – people are able to subscribe to different media titles through WeChat, enabling them to read and then share news articles easily with their friends
  • a blogging platform – people can easily register a public account and start publishing their thoughts online (or following others’ blogs)
  • an online store – the platform offers “subscription accounts” and “service accounts” to sell goods and services. People can easily browse products and services and complete payment all within the WeChat platform
  • a mobile wallet – it allows consumers to bind their bank cards to the app to make payment, it also offers investment funds where people can earn an interest

Very recently I was in a client meeting and we were talking about how we should define WeChat – is it a messaging app? Is it a social networking app? Is it a blogging platform? We came to realize that it is doing so much that we find it’s hard to define it with something equivalent in the West. WeChat might not start as an “original” brand, but it has evolved into something uniquely Chinese, for Chinese consumers.

Herborist

Herborist leverages on existing Chinese wisdom to make it truly relevant for Chinese consumers

Let’s take a look at Herborist…  

As you are reading through the last example, you might argue that in tech sector, the newest is always the best, and that’s why WeChat has become successful. Now let’s take a look at another category where being new is not the most important parameter. Another successful Chinese brand that comes to mind is Herborist.

The beauty category in China has been dominated by international (Western, Japanese and Korean) brands such as Shiseido, SKII, and Estee Lauder. Domestic skincare brands either keep selling mass-market and cheap products, or they try to imitate international brands (but largely without success).

If WeChat is working against being a copycat brand, Herborist is working against an industry that has been perceived as mass, unsafe and dominated by China copycats. However, this Chinese brand has managed to soar and achieved 80% annual sales growth in European markets. [source]

So what is the magic behind its growth? In an interview with Thoughtful China , Wang Zhuo, former Executive Vice President of Herborist, emphasized the importance to develop a product that “meets consumers’ needs so well that they love our brand.” Unlike other companies that blindly follow international brands, Herborist has leveraged traditional Chinese Medicine (e.g. it’s bestseller T’ai Chi Mask leverages on the TCM philosophy of Yin & Yang), and updated that with the latest technology to make it the skincare brand that represents a modern Chinese skincare brand.

Knowing the negative perceptions that come with the “Made in China” label, the brand has also decided to say that it is “made in Shanghai” – a subtle difference that leverages local pride to gain local as well as international acceptance for the brand.

Herborist’s approach has not only helped the brand overcome the perception that Chinese skincare is copycat, it has also helped the brand find a positioning that is authentic and truly relevant to Chinese consumers.

So what are the implications to research?

In the two examples above, it’s obvious that the success of both brands is about being truly relevant to Chinese consumers. And in my opinion, that is what makes the difference.

At this point you might say that this is nothing new to you, and on a daily basis your business is thinking of how to localize products and ideas for Chinese consumers. Yet, it is a difficult task (to do well) when the R&D and positioning are done globally.

As an insight and innovation agency working closely with MNCs, we understand these challenges. What we have been trying to do is to take “localisation” more seriously. While in the past we localise ideas “for” Chinese consumers (i.e. validating and making ideas relevant for Chinese consumers), we always try to localise ideas “with” Chinese consumers (i.e. co-creating new product and communication ideas with Chinese consumers). Experience has proven that the devil lies in the detail; successful brands (international or local) have won Chinese consumers’ by demonstrating true understanding of what they need. As an agency we’re looking forward to seeing more “born in China” innovation that the rest of the world can “steal” from.

If you’d like to find out more on brand innovation specifically in Asia, then please get in touch with our Asia MD Andrew at andrew.ho@facegroup.com

 

 

 

 

 

 

 

Rethinking Disruption

As researchers at a strategic insights agency, my colleagues and I at FACE are proponents of change: we help create new things, or a new way of thinking, by finding a deeper level of understanding. From communications strategy to design innovation projects, our approach entails observing, listening to, and connecting with people to cultivate ideas capable of challenging the status quo – the limiting norms that govern an organization or the category in which it operates. You might say the aim of our research is to help clients become disruptive.

Clayton Christensen originally coined the term ‘disruptive innovation’ in “The Innovators Dilemma” (1997), and within the last few years disruption as a strategic imperative has rippled through the business zeitgeist and taken root in the culture.

Disruptive Innovation

From innovation thesis to digital-era mantra, the concept is now a meme, a convenient way of talking about how to keep up – and the fear of falling behind – in a world of constant change. Only recently have critics emerged, questioning the meaning of disruption and its legitimacy as a strategy. In a New Yorker piece from earlier this year, The Disruption Machine, Jill Lepore shares her skeptical view on the subject: “…despite its futurism, [disruption] is atavistic. It’s a theory…founded on a profound anxiety…and shaky evidence.” She goes on to point out that disruptiveness is not a measure of true advancement, or any indication of sustainable success, for a brand or society at large: “Replacing ‘progress’ with ‘innovation’ skirts the question of whether a novelty is an improvement: the world may not be getting better and better but our devices are getting newer and newer.”

Lepore’s argument is sound and provocative. It raises big questions about “the gospel of innovation” that emanates from Silicon Valley and galvanizes hopeful entrepreneurs across the globe. Is disruption, then, still a tenable objective? Yes, but it is time to reframe the mainstream take on what it means to be disruptive and how to make it happen. Here’s a quick guide for getting started:

1. Determine what you’re actually trying to disrupt, and why

Sound obvious? Maybe, although there seems to be a growing stream of briefs floating around that call for disruption without any well defined aim. For example, the goal should be to disrupt a market, or perhaps your organization’s creative process – not consumer behavior. Identifying and developing ways to satisfy latent demand can indeed lead to behavior change; however, that’s ultimately an outcome, not a strategy. The intent must be to alter a system that’s failing to deliver on that demand, not to force consumers into a new mode of experience. It can be counterproductive to invest in shaking things up when either internal energy is unfocused or the external landscape is not ripe for a shake.

2. Hone your understanding of the landscape you plan to disrupt, and the constituents you plan to serve by doing so

The rhetoric around disruption can suggest that market-shifting product and service innovations are born from instinct, rather than cultivated from insight collected in field. Steve Jobs famously remarked that consumers don’t know what they want. It’s perhaps risking heresy but I’d offer an alternative view: consumers don’t do a good job of articulating what they want on their own. There’s a difference: your team may not be filled with prescient strategists and designers, but you’re more than capable of observing and interpreting what’s happening outside of your organization to activate internal ingenuity.

At FACE, we’re firm believers in the power of anthropology to inspire and guide innovation. In addition to face-to-face methods, we have developed technologies to capture and decode consumer thinking, including online research communities, a mobile ethnography tool, and Pulsar, a best-in-class social data intelligence platform.

These tools empower us, and our clients, to lead by listening. In this sense disruption is less akin to interruption as it is to conversation, in which brands are challenged to move the discussion forward in new and interesting directions.

Creativer People

3. Design an ideation process that breaks through norms

The definition of “disrupt” is to alter or destroy an existing structure. This starts internally: personnel, atmosphere, and inspiration stimulus need to converge in new ways to catalyze new thinking. At FACE we’ve pioneered a workshop method called co-creation, which takes our clients out of their methodological comfort zone in order to spark bigger ideas with more depth and longevity. Co-creation unleashes the creative potential of consumers, experts and brand stakeholders, and combines collaborative ideation, strategic planning and illustrative design. The process pushes teams to:

• Ideate with flow: there is no divorce between insights gathering and ideation for strategic or new product development. They live in the same time and place.

• Foster productive tension: facilitators find momentum in clashing people and beliefs to propel ideation forward and move everyone toward the same goal.

This method has a proven track record for creating successful innovation ideas, faster and cheaper than in the traditional linear NPD model.

Truly disruptive products and services are simplifiers at the core, but getting there is far from simple. Developing successful ideas takes a strategic approach and profound insight. Disruption’s rise to buzzword-status brought on a perception that disruption itself is a strategy that promises big results. This is misleading: if your team wants to catch the disruption wave, question what it will take to get the timing right and achieve a balanced ride to actual progress. We hope these 3 points here will help you do exactly that in your company’s innovation process.

If you’d like to find out more about co-creation methodologies then download our white paper entitled “The Co-creation Revolution“, which explores the basics of co-creation. Also, see how we implement this methodology by reviewing our study with Axe Skincare

Please get in touch if you’d like to talk about how you can get the most out of co-creation by emailing Marc at marc.geffen@facegroup.com or tweet him @marc_it.

Andrew Ho at Spikes Asia: The problem with how you get your insight

A couple of weeks ago our MD Asia, Andrew Ho, travelled to Singapore for Spikes Asia, where he attracted a full house with his talk: “The problem isn’t your creative… it’s how you get your insight”.

“We look for insight to inspire great creative, so why don’t we hunt for insight in more creative ways? Everyone hates research; it’s not just creative people. It’s an uninspiring environment, we are starting the creative process in the worst environment possible.

View the full Spikes presentation here:

To understand how we become more creative during research we need to turn the whole idea upside down and re-think the entire process: begin by listening, and then co-create more ideas and insights, which will be rewarded with better briefs, resulting in incredible ideas.

But why is there a lack of creativity? Andrew believes this is down to a loss of communication: we don’t talk to each other anymore. He quoted the great Albert Einstein: “ I have never made my discoveries through the process of rational thinking”.  Instead we need to create insight creatively.

So who is responsible of all of this creative thinking? In typically bold style, Andrew concluded:

“Insight, strategy and creativity is everybody’s responsibility, I don’t care what you’re role is, if you’re not interested in these things you’re not doing your job.”

To find out more about gaining insights through creativity, get in touch by emailing info@facegroup.com

Follow Andrew on Twitter: @andiho