Creating market innovation

Your company has special knowledge, technology, organization and energetic people. A developed potential, ready for new tasks. Strong enough for further growth, for conquering areas you have never thought of before.

The question remains as to which markets offer you realistic opportunities. What can your skills be used for elsewhere? In which neighboring industries are your strengths in demand?

We clarify your competencies, resources and potential. For these, we identify new fields of application and markets. Together, we comb through our extensive industry database and identify your opportunities for new growth. We contact the potential target markets. Identify their needs through market research. Search for early adopters and joint development partners. We then bring everyone together to carefully weigh up the opportunities and risks. This is where the Go-NoGo decision for your future success is made.

What is a market innovation?

When you think of innovation, you usually associate it with a new product. However, there are many other forms of innovation. Market innovation is one of them. You try to transfer the technologies that you already use to new fields of application.

However, the term market innovation has no geographical dimension. It does not mean the development of new regional markets. Rather, with a market innovation you try to penetrate, with your existing know-how into industries in which you have not yet been active. The measures you take to achieve this are very different from those you use to expand into new regions.

Market innovations prove themselves

There are already several companies that have successfully implemented LEAD Innovation in a successful market innovation. Getzner Textil is one of them. Its core competence is a special weaving technique with which particularly thick and functional fabrics can be produced. Getzner no longer simply uses this expertise to manufacture fashion fabrics for shirts, and they now produce technical fabrics and corporate fashions, which have become part of the company's operations. LEDvance has found new fields of application for its spray coater, which until now then only been used in the lighting sector, through a market innovation. And the German manufacturer of medical aids, medi has been successfully active in the sportswear market for several years under the brand name CEP. The latter project was not only a market innovation, but also a business model innovation.

What can your company really do?

At the beginning, it is important to get an exact picture of your own portfolio and technologies. It is helpful if you can abstract the function, the use and the characteristics of your products. Using this method to look at the very basic functions of your products, you leave the industry silo in which your company operates automatically. You should also get outside help with this step, because external experts may discover completely new fields of application for your products, your technologies and your know-how. This is because external partners are not as fixated on previously used applications as you, and your employees, are.

Which industries do need your skills?

The list of your competencies, or the basic functions of your products, can now be compared with the LEAD Transfer database. This internal competence database was developed by LEAD Innovation using the scientific method "Technological Competence Leveraging". The database helps to find industries in which specific competencies are needed. It is based on the Global Industry Classification Standard (GICS) and contains information such as technical processes, products with their most relevant characteristics, customer benefits that companies should generate, as well as sales and logistics processes. This comparison shows you which industries also use and demand the competencies that your company has.

Which commitments will pay off?

If you have found different industries in which your competencies are relevant, then you should check in which, an engagement would give an economic return. This step does not only include a market analysis regarding size, competitors, entry barriers and customers. Large-scale telephone research within the relevant industries shows whether the competencies could cover not only current, but also future needs.

What role could your company play in a new industry?

As soon as you have discovered industries in which a commitment also pays off economically, you should deal with an actual entry scenario. What happens if you enter this market with your products or technologies? How would your potential competitors react if they used products with similar basic functions but with a different technology? Which companies could you work with? What place would your company occupy in the value chain? Which trends relevant to you, and your technology, are emerging in the respective industry? At this stage, you also consider who to contact to discuss all these issues. Or which partners you want to enter the market with.

What are the concrete opportunities and risks?

Now you have concrete discussions with industry representatives, early adopters and potential partners and discuss your plans together. These discussions will identify opportunities and risks for a possible market entry. You will find out whether the problems that your technology solves in the specific industry are actually relevant. These discussions also help you to decide whether you want to enter the market alone or with a partner.

Go or No-Go decision

In the end, you analyze all the information from the previous steps and decide whether or not to make a commitment. Even if the process has shown that several industries might need your technologies, it is advisable to concentrate on the most lucrative at first. Even if you have clarified a lot of questions beforehand, there is still a certain degree of uncertainty associated with entering a new market. Therefore entering into several markets that are still unknown to your company could tie up too many resources.

Advantage No. 1: New growth opportunities

If one of your technologies is completely new to another industry, then you have a decisive competitive advantage over the established players.

Advantage No. 2: Broader risk spread

If your company is only active in one sector, then its economic survival depends very much on the development of this sector. If you are active in several sectors, then you minimize your entrepreneurial risks.

Advantage No. 3: New partners

In new industries you will meet new potential partners. This often results in opportunities to use your technology together with others, in other application fields.

Advantage No. 4: Lower costs

A product innovation is usually associated with high costs because you have to develop something new. For a market innovation, however, you do not have to invent anything. It is only necessary to adapt your technology or your product. Of course, this advantage always depends very much on the project.

With a market innovation you can open up new sales markets with your existing product portfolio and your know-how. Experience shows that a successful market innovation requires the establishment of a hundred new contacts. Another success criterion is the involvement of the right employees in such a project.

If you are looking for new expansion opportunities, you can carry them out with a market innovation without too much investment. However, the relatively low costs compared to other types of innovation are not the only advantage, as through a market innovation you gain new partners, can give your business a broader base and thus reduce your risk. If your technology is new to the industry you are entering, then you also have a decisive competitive advantage over established market participants.

Market innovation should not be seen as expansion into new regions. Rather, you are advancing into new industries with your existing product portfolio, know-how or technology. A market innovation is divided into six phases. In order to successfully enter new markets, you must select the right partners and employees for each stage.

The term market innovation has no geographical dimension. It does not mean the development of new regional markets. Rather, with a market innovation you try to penetrate, with your existing know-how into industries in which you have not yet been active.

The starting point for every LEAD Transfer project is always the client's core competencies. Therefore, the starting point is the analysis of the market, process and product competencies. Interviews are conducted not only with internal experts, but also with external experts.

In talks and discussion rounds with potential customers, we survey the market size and market opportunities in the new market targeted. The target market search is concluded with a round table. The final result is our written recommendation for action.