We typically think of innovation happening at the product level. But it’s really hard to design, develop and launch a truly innovative product. That’s why we have a market full of look-alike products.
They’re copying the what - the product - when they should copy the how instead.
The ‘how’ innovations are in the process and positioning of a product. Here are some famous examples of how companies took existing products and innovated in their process and positioning to become market leaders.
Process
An innovative process takes an established product and changes how it is manufactured or distributed.
Netflix has innovated the process of watching movies at home twice in their history. First, they eliminated the need to go to a store to rent a movie by sending you DVDs in the mail. Then they eliminated the need to send you DVDs in the mail by streaming the movie straight to your TV.
They didn’t invent DVDs or streaming, they were innovative in distributing the technology to their customers.
Positioning
Innovative positioning takes an established product and changes how it is perceived in the market to differentiate it from competitors. Typically, this means going upmarket to create a premium position or going downmarket to create a cost-conscious position.
Apple didn’t invent the personal computer and Tesla didn’t invent the EV. Instead, they positioned themselves as the premium version of these products. They started by positioning existing technology and then rolled out innovative products.
Liquid Death
This leads us to one of the most interesting brands in recent years - Liquid Death. They’re a great example of being innovative in the process and positioning. Liquid Death simply re-packaged water by putting it in tall cans with distinct labels. The tall can packaging is an innovative change to the process but also sets them up to have an innovative position in the market.
They’ve positioned themselves as the rebel in the market and they reinforce that continuously through their marketing. They’re packaging differentiates them from any other water brand and, instead, makes them appeal to an energy drink consumer. But they’re different from any energy drink because of what’s inside the can.
It’s crazy to think that one of the most innovative brands in recent years sells water. But they’re a perfect example of innovation in process and positioning. The product they sell is a commodity - the furthest thing from innovation. But how they sell it is the real innovation.
Most entrepreneurs aren’t going to be creating truly innovative products. We’ll be selling our variation of something that already exists.
If you’re going to copy what others are doing, look for ways to copy the process and positioning of brands outside of your industry and see how you can apply them to yours.
Don’t copy the what, copy the how.