Of course, there are notable exceptions such as Amazon and eBay but more often than not the product innovator fails.
Arguably innovation is the lifeblood of a successful company. A cursory look at innovation in the US consumer goods industry sector revealed that, between 2000 – 2004, 98% of all new products were either product line extensions or small improvements to existing products. Only 2% of new products were considered a breakthrough innovation. Approximately half of these new product innovations will be off the shelves within 12 months.
There is general acceptance among marketers to adopt a different marketing strategy as product innovations gain broader appeal in the market place. However, the same cannot be said for the selling approach and the sales organisation that is necessary to support a successful product innovation. Too often the way marketing and sales is organised is part of the problem. Many multi-product companies split the role of sales and product management. It is the responsibility of new product management to stimulate demand for the new product and sales to fulfil that demand.
However, in the era of relationship selling and key account management the salesperson is often the person responsible for generating demand within the account. Complex sales opportunities that may require the customer to change processes within their business are very different to the sales processes needed for replacement orders.
The multiple buying influences within the buying organisation make it necessary for the sales person to be equipped to manage a detailed sales process. If the sales team are evaluated on reaching a revenue target it makes sense for them to focus on maximising revenue opportunities and allocate their time accordingly. Repeat business or fulfilling customer demand requires minimum sales effort and the risk of failure is low.
Conversely selling innovation or generating demand by selling new products will require a huge selling effort with a high risk of failure. New product managers cajole salespeople to sell but unless the innovation crosses the chasm and customers ask for it, why would they?
Short term sales incentives for selling new innovations is a symptomatic solution but does not address the flawed sales process and ultimate success is only achieved if the product crosses the chasm. For a short term sales incentive to work for a product innovation it better be a narrow chasm.
Similarly, companies that innovate new product categories are reluctant to change their sales processes as the market evolves around them.
As a technology is adopted and becomes mainstream, the way we manage the sales process should evolve with it. Five or 10 years ago Internet service providers may well have required sales people who could go out there and generate demand for more bandwidth.
Today, however, the Internet value proposition is much better understood by companies and the sales role is more about demand fulfilment and ongoing customer service but does the sales structure reflect this?
