One section of this chapter that really caught my interest was when the author pointed out that sometimes the rate of technological development increases faster than the rate of consumer needs. This means that during cycles, there will be periods where technology is available to customers, that those customers don’t have the need for yet. I believe effectively selling these products lie in the hands of marketers, and I have definitely noticed commercials that first tell you have a problem, and then present a product that fixes that problem. If consumer needs aren’t keeping up with the pace of technology and innovation, then it is up to the companies themselves to make them change. I believe that this is easier for more established companies, especially including Apple. Customers are more likely to be convinced to try a new innovation if it comes from a company that is known for being innovative. I believe that Apple could come up with almost any innovation and people would buy in to it because of Apple’s reputation. I think that there is a challenge facing startup companies in that they have no brand recognition. A company could have invented the greatest product ever, but I believe that it would take longer for most consumers to buy in to it – to move past the stages of innovators and early adopters – because the customers don’t yet trust the brand.
Another part of this chapter that I found interesting was the concept of discontinuous technologies. This is when a new innovation comes along that completely renders another product obsolete. This means that this new obsolete product might not even reach its full potential in innovation because there is no need for it anymore. Hypothetically, someone could completely revolutionize the beeper, but it wouldn’t matter because beepers are obsolete and even the best beepers in the world couldn’t compete with cell phones. Discontinuous technologies mean that companies always need to be on the lookout for potential new products that could eliminate theirs. The beginning of this chapter talks about both product and process innovation. I believe that both are essential to remain competitive, especially in today’s constantly changing environment.
There are a couple companies that come to mind to me that I associate with failure to remain innovative. One, most recent, company is Hostess, which recently went out of business because they failed to keep up with consumer tastes. Hostess never innovated their product line to keep up with people’s tastes changing towards healthier products. Another example of a company run out innovation is Borders. Borders could not keep with the competitive prices of online marketplaces such as Amazon, nor Amazon’s Kindle e-reader. I believe that the only reason Barnes and Noble is still in business is because they came out with a Nook tablet and also have somewhat of an online marketplace on their website. They also provide a rental service for college textbooks, which can definitely help them with competitive pricing. Finally, an industry that has definitely changed with innovation is video rental. Hollywood Video went completely out of business due to video rental services like Netflix. I believe that the only reason Blockbuster is still doing business (although they did go bankrupt) is that they started a service similar to Netflix. Blockbuster still had to shut down a lot of its stores. Incidentally, there was a still a consumer need to rent videos on the spot. That is where Redbox came in to fulfill that need. I believe that keeping up with innovations can make a company, while not being innovating enough can break one.