The Debate 2018: A multi-part discussion on disruptive innovation, marketing and branding

Jorge Narváez-Arango
Senior executive creative director of consumer and retail brand experience for North America, Interbrand

How do you define disruptive innovation?

Some people believe that innovation is creating something brand new. I think that innovation is actually combining things that already exist to deliver a new proposition. I believe innovation and invention are very different.

One of the biggest and most well-known innovations is Uber. The concept was so simple. Combine products and a service that just came to the mass market—smartphones and location positioning—and apply those technologies to the way you hail a cab. All parts of the equation already existed. What made it new was the ability to look at them differently.

If you think about it, most important creations were built on a previous idea. Inspiration often doesn’t come from nothing. Even the wheel was inspired by a log. But it’s a new perspective on that product or service’s capabilities that results in a new application. This new perspective transforms something old into something new.

Interbrand took two things that already existed and delivered innovation for the Orbit gum brand. The technology for printing designs on clear plastic wrap already existed, and gum boxes were already being wrapped in clear cellophane.

We looked at the package differently and realized that we could really transform the brand experience by printing a series of patterns onto the overwrap. This creates a much more special opening ceremony for the brand fans, and it helps the brand differentiate itself in the market.

Our team has also leveraged printing technology to deliver innovation to the paper towel industry. Movie merchandising already existed, and printing graphics on paper towels was already a commonplace practice when we decided to merchandise paper towels by associating the products with family movies. These new kinds of graphical stories and patterns made paper towels more fun for families and delivered significant market growth for the Bounty brand.

Why is disruptive innovation important for well performing markets?

It’s important for healthy markets because innovation continues the evolution of the market. Every market needs and requires new ideas—not just the markets that are saturated. So by coming up with new ideas we create new opportunities. Those new opportunities create a ripple across industries.

I just gave a presentation about the automotive market, and I discussed that the automation in vehicles is prompting the need for roads that are also intelligent. Sensors in the roads should be used to communicate with these automated cars. So an innovation in automotive is creating a need in another industry—road construction.

Also, if a market or a brand doesn’t recreate itself, then it will get stagnant and regress.

What can larger corporations learn from market disruptors?

Many things. Large corporations cannot settle on their laurels. It’s understandable that companies would avoid the risk that comes with disruptive innovation. But the thing is if you want to continue to be relevant then you need to be a disrupter.

Look at Apple. When Steve Jobs led the company, he pushed for innovation. Apple took risks, and it had the most growth under Jobs’ leadership. Jobs looked at products and services differently and led teams that took his unique perspective on products and services to create a new way to use a phone and used the power of human touch to redefine the home computing experience. During this time, Apple rolled out the iPhone and the iPad, and not always without critics warning about the risk of releasing these products. But the company’s ability to be a disruptor was severely dampened when Jobs left this earthly plain.

And this applies to brands across categories, not just to the Apples of the world. Because it’s become easier to start a company, there are many disruptors in the market. The big corporations feel that pressure. Market leaders such as P&G are now requiring their partners to bring new ideas that allow its brands to grow.

But it’s important that corporations remember that disruption, with all its benefits, require them to be nimble and accept risk. It’s the ability to take risks that allow you to grow.

Why would a successful business leader choose to take on the risk of disruptive innovation?

Successful business leaders understand risk and reward. You’re not a leader if you don’t take risks.

It’s not about taking risks for the sake of taking risks, either. It’s calculated risk that needs to be embraced—an understanding that there can be failure but having a vision to navigate through those challenges and the bravery to go regardless. Leaders who embrace this mindset often deliver even bigger, even grander results than they expected.

Then there’s the risk of becoming stagnant. Doing the same thing over and over again doesn’t deliver growth in life or business.

What products or services are ripe for innovation?

Time is a very valuable asset in our lives. The ability to give people time back into their lives through products and services is a market that’s ripe. We’ve already seen products that return time to people earn success, such as mobile, which puts nearly everything you need in your hands through services such as Amazon, which makes the shopping process quicker.

Making necessary tasks more efficient can potentially make them more enjoyable. Gone are the days when buying a shirt meant going to a mall and searching the stores’ inventory by visiting each shop from one end of the shopping center to the other. You can buy what you need from Amazon or other Web commerce stores, or you can search the stores’ collections prior to actually visiting them. Now, you don’t have to shop for four hours to find your perfect shirt. You can spend more quality time with your family, instead.

We all have a limited amount of time in our lives. We are all going to die, so spending time doing the things we love with the people we love is critical. You might love your job, but what if you could do your job faster so you can spend more time doing the things that your family loves? A product that gives you that ability will be successful.

And what if that tool can also help you do your job better? Machine learning can and will further our ability to save people time, at home and at work. Having worked with IBM for the last five years and being really connected to technologies that were able to use machine learning and artificial intelligence, I’ve seen how these technologies will become a tool for people and not their replacements.

It’s amazing to think of a future that leverages the power to search larger data sets to understand patterns—a future in which a doctor can diagnose a condition more quickly because machine learning and artificial intelligence will be able to read billions of records in the time that it takes a human to read one newspaper and when the entire medical community can leverage machine learning to be instantly up-to-date on all the latest medical advancements.

Other technologies such as virtual reality are set to disrupt industries such as travel. What if technology can help people see the wonders of the world, even if their health requires them to stay in a nursing home. Imagine being able to walk the streets of Paris without ever boarding a plane.

On the subject of destinations, there’s a reason why big cities put up big pieces of architecture that are insanely wonderful. Singapore has beautiful pieces of this destination architecture so people will exchange their time for something amazing. A place that doesn’t have much to give to you is wasting your time.

That’s why the time is right for destination retail. We need to give customers a reason to go and check out the store even if they don’t necessarily need to go buy something. We need to give them a reason to come and explore the possibilities.

Can disruptive innovation be used as a marketing and branding tool?

Absolutely. Disruptive Innovation gives you a leg up on your competition, and it can be the platform for your branding and marketing.

Take Sonos for example. Its products produce a much better sound. When Sonos advertises this fact, Sonos differentiates its brand from its competitors. Advertising that talks about the color of its speakers or the fabrics isn’t as effective.

How can design thinking be used to create disruptive innovation?

Design thinking is a process that empowers a person with the ability to identify and understand problems as opportunities. It’s not the only process to create disruptive innovation. Part of disruptive innovation is the ability to see an opportunity where there isn’t an obvious problem.

Take telephone technology in your and my lifetime, Linda. When you and I were children, there were rotary phones connected to landlines and they worked well. If, at that point in time I would have tried to ask someone what they needed in a phone, I wouldn’t get an answer that includes everything that is on my mobile phone today. Most people were happy to have their landline that allowed them to make phone calls.

Disruptive innovation takes a serious step towards changing how people think about phones with the implementation of touch-tone phones, which could be used to control other devices. [Editors’ note: When President John F. Kennedy used a touch-tone telephone to remotely start the countdown for the opening of Seattle’s World’s Fair in 1963, he remarked, “This manner of opening the fair is in keeping with the exposition’s space age theme. Literally we are reaching out through space on the new ocean to a star which we have never seen, to intercept sound in the form of radio waves already 10,000 years old, to start the fair.” Source: Papers of John F. Kennedy. Presidential Papers. President’s Office Files. Speech Files. Remarks on opening Seattle World’s Fair, 21 April 1962, For many of the Americans who heard President Kennedy’s remarks, they forever viewed the potential of mobile technology differently.]

We then could carry a phone like a suitcase, instead of looking for a payphone every time we needed to make a call away from home. The Motorola MicroTAC, which was pretty much the dial-tone phone you had at home but in your pocket; it made the earlier mobile phones almost look like weapons. And somewhere in that time, people carried beepers, including alphanumeric beepers that received and sent text messages. Now, we have mobile phones that are pretty much going to replace our home computers.

What are your favorite examples of disruptive innovation outside of your work?

My favorite one is Uber obviously. We started this conversation by talking about Uber.

But I also think that Peloton is a pretty cool concept. The idea of having your own gym in your house but, at the same time, being able to virtually be connected to the rest of the world. It delivers the privacy and convenience of your own home, but the experience of riding in a group.

The Dollar Shave Club and Rent the Runway also changed their industries, and drones have changed the way we think about defense and transportation.

Is there anything else you would like to share on the topic of disruptive innovation?

Disruptive Innovation is the essence of who we are. Creatives are creators; we need to come up with new things. But we need brand management that is willing to take chances to be able to deliver new things that encourage company growth.