These product innovation frameworks turn ideas into winners

Some companies build product innovations into their DNA. Think of Taco Bell’s collaboration with Cheeze-It to produce the Cheeze-It Crunchwrap & Tostada. The tasty combo features a Cheeze-It 16x larger than the original, generating a lot of buzz. 

Other big brands, such as Nike, Starbucks, McDonald’s and others, know that the key to staying competitive is staying engaged with consumers. One way to do that is to introduce new products to the market that fit with current consumer trends, wants or needs.

Do you remember Bed, Bath & Beyond? They’re just one cautionary tale of a brand who didn’t innovate.

When legacy brands have no product innovation strategy, they lose market share and slide down the retail mountain until their storefronts are empty and their names a past relic.

Successful brands cultivate an innovative mindset and a structured product development strategy to create winning products. 

In this article, I’ll uncover the importance of having a product innovation strategy that aligns with your overall business goals, plus three popular frameworks to help you build a culture of innovation within your brand. Let’s start with an introduction to product innovation strategy and how it can improve your brand’s success.

Innovation is more than new ideas. It’s aligning those ideas with market trends and consumer behavior for business value. 

According to Harvard Business School, “Product innovation is the process of creating a new product—or improving an existing one—to meet customers’ needs in a novel way.”

Innovation is more than a buzzword. It’s essential for long-term business success. Technologies change, consumers look for new solutions or diversions and once legacy companies get left behind.

But your brand is smart. Your brand will use a product innovation strategy to stay relevant and avoid becoming the Blockbuster of your niche. Instead of ignoring consumer behavior, you understand effective product innovation must align with business goals to keep your customers coming back and finding new audiences. 

Blockbuster had millions of customers and could have surveyed their audience to see if they wanted a movies-by-mail subscription. However, the legacy brand didn’t spot changing trends and ultimately handed their business over to Netflix. 

A product innovation strategy is a way of thinking and using the right tools to help you test, refine and execute ideas in real time so your brand adapts to changing markets. 

A more recent example of this is Starbucks’ new iced energy drinks. These came about after the brand saw how much Gen Z gravitates toward both iced and energy drinks, which resulted in this new creation. So how do you get to that place? The best way to innovate your product strategy is to start with a proven framework. 

There are a dozen product innovation frameworks, but the ones we’ll discuss below are:

1. Design Thinking 

2. Agile/Scrum

3. Stage-Gate

We chose these because of how well they work with innovation tools to test ideas through execution as well as CPG brands. 

Now let’s dive deeper into each of these frameworks. 

Innovation without structure is a chaotic and expensive exercise. Imagine people chasing pet projects without tying them to business results. Instead, these structured frameworks establish guardrails to keep you on the right track.

Let’s explore these in more detail.

Design Thinking

Design thinking focuses on people. Think: Who’s using this, how and why? 

Have you ever used the IDEO deck for inspo? If not, they’re a deck of 51 cards designed to be used by brainstorming groups to develop a path from idea to execution, quite similar to the design thinking process. 

"Design thinking is a human-centered approach to innovation that draws from the designer's toolkit to integrate the needs of people, the possibilities of technology and the requirements for business success."

- Tim Brown, Executive Chair of IDEO

Design thinking evolved from a 1960s approach when people in all types of disciplines started applying scientific principles to design. In other words, they developed a hypothesis and tested it. 

The 30-second version of design thinking defines five stages: 

1. Empathize 

2. Define 

3. Ideate 

4. Prototype 

5. Test

You can see a concrete example of this in PepsiCo. The popular snack brand identified challenges in its innovation process. They required faster feedback, scalability, cost efficiency and actionable insights. The data needed to give them ideas for what to do next. 

PepsiCo and Zappi embraced design thinking and the Zappi Insights Alliance (IA), ia group of forward-thinking brand leaders that used their ideas to help solve PepsiCo’s challenges. 

Zappi developed two tools to enhance PepsiCo’s innovation which focused on early-stage concept evaluation and later-stage optimization to help the snack brand test early-stage ideas and optimize later-stage concepts. The results? PepsiCo received over 60% quicker consumer feedback than the global average, which allowed them to act faster and with more confidence. 

Agile/Scrum

Popular in project management circles, the scrum/agile approach breaks projects into short “sprints” to focus on a specific workflow. 

These sprints often last from as little as a week to four weeks. The scrum approach includes a daily scrum session, often a 15-minute meeting to address any roadblocks from the previous day and create a structured plan for the next day of work. 

This framework focuses on iteration and the process of testing, iterating and refining.

Stage-Gate

Co-founded by Dr. Robert G. Cooper and Scott J. Edgett in the 1980s, the Stage Gate framework grew out of their deep experience in innovative product development. It’s a methodical approach used across industries. 

The name references each stage of a project. Each stage must go through a review before it advances to the next stage. 

The process begins with a discovery stage to identify new opportunities, moves to scoping, creating a business case, development and then testing. 

Here’s how one LinkedIn user describes it: 

Regardless of your chosen innovation framework, the basic structure is the same: ideation, validation and iteration to refine the concept. 

Overall, certain product types might lean more towards specific frameworks than others, but each has value. 

No matter what framework you choose, the next step is to integrate it into your product development lifecycle. By using a structured approach, you connect your product innovations with business goals and consumer behavior (and operational constraints).

How frameworks integrate into the product development lifecycle

Wondering how to integrate your chosen product innovation framework with your development lifecycle? Great question. 

If you want to explore customer research more deeply, a design thinking framework is a good place to start. This approach, combined with an AI-enabled consumer insights platform allows you to conduct consumer surveys for brainstorming and real-time feedback. 

The Scrum/Agile framework encourages you to use consumer feedback for prioritizing development and use defined sprints to make fast progress. For example, Spotify uses this framework to develop and iterate your personalized playlists including Discover Weekly and your annual Year in Music otherwise known as Wrapped. 

Lastly, Stage Gate is a framework typically used for big projects where you may not know the problem yet. Some brands, like Chipotle, even create their own unique Stage Gate process to create new products or menu items. 

Now that you have a greater introduction to these frameworks, let’s consider what goes into your strategy. 

Key elements of a product development strategy:

Creating successful products is the core of any product innovation framework. Here’s how to approach pre-planning, even if you’re unsure which framework to use. 

Market analysis

Successful product innovation always starts with the market. Marketers and insights professionals know that innovation cannot happen in a vacuum. You need the right tools to understand market trends, shifting customer behavior and the competitive landscape.

Do you remember Google Glass? Those sci-fi-looking glasses that recorded everything around the wearer? It turns out people don’t want strangers to invade their privacy while they’re out shopping, working or dining. This product flopped twice because Google refused to understand the market. 

Three tools for market analysis: 

Successful product innovation requires ongoing market analysis to understand customer behavior, the competitive landscape and shifting market trends. 

These three key tools can guide companies in developing successful products.

• Surveys and focus groups: Nothing beats feedback from real people. Before moving forward with product development; determine whether your ideas meet customer needs.

• Competitive research: Understand the competitive landscape and spot market gaps early to create on-trend products.

• Trend analysis: Consumer preferences shift based on lifestyle and cultural trends. Take the “sober curious” lifestyle where Gen Z and Millennials drink less alcohol than other generations. Through real-time data, brands like Corona developed Corona Zero to capitalize on these types of changing consumer trends. 

Ultimately, competitive brands don’t guess at what customers want; they use real-time customer data analysis to guide their innovation pipeline. 

“Marketing without data is like driving with your eyes closed.”

– Dan Zarrella

It’s connected consumer insights that help top brands truly stay competitive. 

Resource allocation

Marketers know that successful innovation requires balancing creativity and business goals. Teams must invest wisely in projects with the greatest potential for success. 

Here are some key considerations to keep in mind:

• The people: Effective cross-collaboration is a superpower in today’s world. For starters, most successful companies include representatives from R&D, marketing and finance. Which departments will you need to innovate your best future products? 

• The budget - Innovation requires research, prototyping, testing and marketing. What are your highest-impact ideas? 

• The technology - Staying on top of what the latest tech has to offer is also crucial. What tools will you use to test ideas and iterate and develop your product innovations? 

Market analysis and experienced resource allocation ensure companies don’t innovate new products for the sake of creating something new, but instead focus on sure-fire hits that consumers want. 

Timeline management in product innovation 

Effective project management requires a workable timeline and clear milestones, but not all innovation frameworks approach these in the same way. Some are fast and flexible, while others are methodical. Which is right for you depends on your product and business.  

• Design thinking starts with user needs and prioritizes audience research over timelines. It takes a “we’ll ship when it’s ready” attitude. Apple is famous for this because they can spend years designing new products vs. rushing to market.

• Agile/Scrum is more like a scrappy startup. However, it works even if you’re a legacy business. In this approach, people work in sprints of 1-4 weeks, where teams test, iterate and test some more as fast as they can. This works great for products with gradual improvements like refining product concepts.

• Stage-Gate is the most methodical. This approach has long project times with a specific approval process at each milestone. It’s perfect for pharma and aerospace companies. Some CPG brands also use this approach to manage diverse portfolios. 

A successful product innovation strategy informs and directs the product development strategy. For example, your brand may have a lot of potential product ideas, but how do you know which ones to pursue? With today’s innovation tools, you can test concepts with your customers early and often to gauge which ones have the most validation. 

Practical steps

By now, you’re probably thinking, “This sounds great, but how do I make it work?” There’s room in every business for a smart product innovation strategy. Whether you’re brainstorming new concepts or refining existing ones, it’s best to use a structured framework to achieve success.

Here’s five steps you can take to create your own product innovation strategy:

1. Define clear objectives 

Too many objectives spell confusion. Are you looking to increase market share? Expand into new audiences? Refine an existing product? Make sure you clearly define your objective at the start.

2. Conduct market research Market research is the heart of innovation. Without it, you’re relying on guesswork. Keep on top of trends, shifting consumer behaviors and market gaps. A consumer insights platform is a great way to stay on top of what your consumer wants and needs, as well as any upcoming trends.  

3. Encourage collaboration across departments 

Successful innovations require experience and knowledge from multiple departments. Invite customer service, marketing, R & D, finance, sales and any others who can add insights. 

4. Develop and prioritize ideas 

Not every idea needs to move forward. With your objectives in mind, smart market research, collaboration and the guiding structure of a product development strategy, you can use innovation tools to prioritize the best ideas. 

5. Test, monitor and iterate based on feedback 

As mentioned before, consumer behavior is constantly shifting and it’s essential to stay alert and on top of the market with the right tools. That’s why it’s not only important to research your ideas with consumers, but to iterate and optimize based on the feedback you receive.  

Which is the best framework for your business? 

Choosing the right framework depends on your industry, speed of execution and product development uncertainty. 

• Design thinking encourages customer-centric innovation.

• Agile/Scrum grew out of tech startups. It’s a fast-paced approach brands love because it speeds up product development based on real-time feedback. 

• Stage Gate is useful before making a major investment in a new market. 

Now that you’re thinking about the right product innovation framework for your business, you might wonder how your organization can create a culture of innovation. 

How to create a culture of innovation

Successful product innovation starts with people. 

It’s a way to empower employees to embrace experimentation and think “what if.” Such an environment encourages continuous learning, to spot trends and shifts in consumer behavior and consider new ways of doing things. An innovative culture works best when leaders model adaptability, support innovation through their behavior, celebrate learning and invest in the right tools. For example, Google’s 20% rule provided resources for engineers to create breakthrough products like Gmail.

Ideas are everywhere. But the successful companies are the ones that help refine the promising ones and connect with customer demand, preventing expensive flops. By following a proven innovation framework and consumer feedback, brands can turn successful innovation into a repeatable process. 

There’s no luck in finding your next winner. It’s all about planning, preparation and using the right tools.