Innovation Needs Insights Not Just Ideas
I’ve had the privilege of being on the inside of a many corporate product development initiatives.
My biggest regret is that they didn’t have code names like Operation Condor or Operation Honeydew.
My second biggest regret is that we did several of them all wrong by starting with an idea or a company/bank-first perspective. What I mean by that is that we were attempting to answer questions like these:
- “How can we optimize profit per checking account?”
- “How can we redesign our product offerings to make more money?”
- “How can we cross-sell more products to our current customer base?”
“How can we differentiate our industry or product offerings to diversify and lower risk?”
- “What should our project code name be? Is Condor taken?”
These questions lead to brainstorming for potential ideas/solutions to the problems. Our problems. In several cases they lead to profitable solutions but they never lead to large insights that could scale and create large profits. Your cash cow is meant to have cash calves.
If I had to do all of these meetings over again I would have shifted the focus onto the end customer and look for pain points we could solve. I would look for insights into their problems. Insights.
We don’t do this enough if at all in the financial services industry and it’s the reason that tech firms from outside our industry (@Simple for example) have entered into the foray. They believed bank customers hate banking. The customers hate the technology and the service. They asked questions and sought insights into those problems and identified opportunity if they could provide solutions.
See the difference?
Insights into customer problems = sellable solutions.
Ideas to solve our problems = potential solutions that then need to be sold.
Just over a year ago I moved my focus from working toward ideas to working toward insights. It was at this time that I became curious as to why more bank customers don’t get better rates on their mortgages and auto loans.
In looking at the market and bank data, I saw a wide discrepancy in those who were getting the best rates and those who were at the bottom. Here’s an example I presented last week from a market in Nebraska:
So, was this discrepancy due to a lack of information, poor emotional decision making, apathy, or something else? The only way to find out was to “get out of the building” and interview people.
After hundreds of qualitative and quantitative interviews, I found the consumer insights that now power the technology behind my patent-pending software company, Hip Pocket.
More importantly, the early client results are providing validation that we’re solving a real problem and not just supplying another idea. The bank gets to solve a real problem around context and confidence for the customer and position it for what it is: a consultative conversation to save the customer/prospect money.
I for one am very excited to hear from Krista Berlincourt of @Simple present a keynote at the ABA Bank Marketing Conference in Orlando next week. I want to learn from those outside our industry, to broaden my perspective, to hear their insights, and to ultimately implement the same insight-generating processes into my company, Hip Pocket.
I hope to see many of you there!