The only way out of this cycle of doom isn't what frequently passes for "innovation" in investor presentations, but the real thing.
Close readers of Ad Age may notice that very same sentence elsewhere in this issue. But the sentiment is so important, we felt the need to repeat it in this space.
As with most good advice, the command to "innovate" is easier said than done. And it becomes even harder when marketers and advertisers are beset by a horrible economy. Devoting money to research and development of new products may seem like an unwise use of funds. Experimenting with new forms of marketing and abandoning the tried-and-true seems too big a risk to take.
But 2009 showed us what happens when one doesn't innovate.
Take package goods. After a decade of innovation by way of line extensions, they've run out of room on the shelves. (Innovation has a short shelf life.) Then, faced with increasingly aggressive retailers and a bad economy, many pulled back on new products and research. The result? A surge in private labels. And the other big idea out of the sector -- extending deeper into developing markets -- lost some of its power when everyone tried it at the exact same time. What also hurt was the global nature of the current economic meltdown.
Lack of new products isn't the only thing plaguing our world. We continue to struggle with innovations in marketing. We've all known for a long time that "chaos" was coming. Too many are hoping that the bad times will simply go away. That's not going to happen. The technological shifts will continue, and consumer behavior has changed for all time.
And those who have grappled with these changes have been slow in admitting their recent innovations might not be working. In the digital space, for example, marketers and media sellers have all latched onto the idea of delivering the right ad to the right people when they indicate they want it. Partly because the technology now allows it; also, because in a chaotic world, it's one thing we can all understand. That's great for Google, but the bone yard of other content properties shows this failure of imagination needs to be rectified immediately. Innovation may require recalibration of an old model: building something that increases demand rather than passively stalking consumers across the web.
Whatever the case and whatever sector you are in, here are three simple rules for 2010: 1) Innovate; 2) innovate; 3) innovate.
How to go about that? Stay tuned.