Why is it that some good innovations don’t take off at launch but then take off later?  And how can you ensure you are doing all that's required to launch the right product at the right time?

When Aviva the insurance giant undertook a pilot launch of telematics in-car tracking technology in 2005, there were only low levels of interest. The idea was that the tracking device provided a way for the insurance company to monitor the driver’s (and particularly young driver’s) behavior. The business model was ‘pay as you drive’, based on mileage and also on the driver’s performance.

The plan was to put 5000 boxes into cars and the driver had to pay £50 (US$75) to have it installed. The outcome: take up was low, and the pilot test ended after two years. Aviva had no plans to support it further.

Fast forward seven years, and telematics is now widely available in the UK. The Co-op Insurance company alone has placed over 10,000 boxes in cars. There is a prediction that in ten years time 50% of drivers will have such a box, and they won’t all be young drivers.

In analyzing why a product did not take off first time around, but did the second time, we can tend to focus on the areas within the company’s control - like the product and the business model.

This makes sense. Good innovators are motivated to keep making their propositions better.

Indeed, telematics offered now has been improved so that it is free to the customer to have it installed. Also, the business model has been changed and customers are not just offered a ‘pay as you drive' offer. Many drivers purchase an annual insurance premium, and also allow the insurance company to install a telematics box. In this way, the insurer can build up more detailed information about the driver’s behaviour and therefore also about their risk profile. This means that when it’s time for the driver to renew their insurance, good driving behaviour will be rewarded by reductions in annual premiums.

Innovation Success Factors We Cannot Control.

However, commentators believe that it is not just the changes in the business model and the proposition that have enabled telematics to succeed this time. It is also about changes that go far beyond the scope of what an insurance company can control. We are talking about changes in the social and cultural attitudes – specifically with regard to the use of technology to monitor our behaviour.

In the UK, in the last seven years there has been a massive growth in the number of closed circuit television cameras that have been installed in public places. Significant numbers of people are still opposed to this, and feel that ‘the Big Brother state ’ has arrived. However, over this time many people have also seen how cameras and monitoring equipment can help solve crimes and help communities.

In another key development over this time, people have become willing to reveal their location via their smartphone, so that they can benefit from ‘location based services’.

Part of the reason that the Aviva telematic device failed we are told, was because people felt at the time of its introduction, that it would infringe their civil liberties. Specifically, other people - possibly friends and family would be able to find out where they had been travelling to- and they might not want them to know.

It seems that the reason telematics failed the first time around is due as much to the disconnect between the proposition and a key social trend ‘attitudes to surveillance’, as it is to the business model and core proposition.

So, how can innovators mitigate such problems and ensure that they see the benefits of their first mover advantage and lead the market with innovation?

As we all know customer insight is about understanding customer needs within the context.

The Importance of Social Context and Social Trends.

Sometimes during an innovation project more effort can be focused on assessing whether a concept meets a customer need than on understanding whether it fully fits with the many contextual aspects of a potential customer’s life.

One practical tip for addressing this is at the concept template stage. Many innovators will use this kind of framework to draw together and record all the aspect of the potential  new product or new service proposition.

Such templates vary but will generally include key headings covering the insight that the new proposition is based on, the main benefit, the reason to believe and various other headings about positioning, pricing and sources of volume.

We have found that it can be worth drilling down a further level on the insight and asking what are the social trends, or social context that impact on this innovation? How will they help and how will they hinder it?

When you launch a new proposition, as far as possible you want it to strengthen or reaffirm a prevailing social trend. If it goes against one or more then it is going to be hard for customers to adopt.

If you discover that some social trends are potential barriers, then you have some more problem solving to do at the concept stage to improve your chances of a successful launch. Or, you might realize that your concept is not suited to the current social context and that you may have to wait until the social context changes. Either way, it’s information worth knowing.

Read more about the telematics tracking story.

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