Brands have an ever-present need to change and adapt to be able to compete, grow, and stay relevant in the eyes of consumers. Pressures from the outside environment, new more agile market entrants, and consumers shifting their preferences mean that disruption is part of the strategy of every business today.
Euromonitor’s “Renovation, Innovation and Disruption” framework helps businesses understand how to respond to and execute change, with a varying impact on their markets. Here we focus on “Innovation”, and analyse how brands globally are turning this into an opportunity for growth.
Innovation happens when a company creates new products within their space that attract more customers to their brand. Some examples of how companies may do this is by launching distinct new formats, or creating new customer sub-segments. We explore some examples of companies that have successfully innovated and driven disruption in their industries through these strategies.
Revolut
Revolut is a UK-based financial technology company that offers banking and other financial services-related products. Founded in 2015, Revolut has been at the forefront of developing mobile applications which make financial services more accessible than traditional banking. Skipping over “mobile-first”, the company was one of the first adopters of a “mobile-only” banking format, in large part to attract younger consumers to the platform by allowing them to engage with financial products as they do other aspects of their lives. Consumers across age groups are shifting to mobile banking services which are convenient and offer a broad range of services. Gen Z, who are becoming financially independent, responded well to digital banking both for savings and investments, and to manage their spending. In the 2022 Euromonitor Voice of the Consumer: Lifestyles Survey, 59% of respondents used mobile banking services at least weekly.
By creating a new way for consumers to interact with financial services in the digital age, Revolut has captured the attention of consumers. And, by continually innovating its offers to simplify financial services and improve the customer experience, including investment services, supporting cryptocurrency trading, and favourable foreign exchange rates, it has been able to expand its market share and appeal to more consumers, especially young consumers just entering the marketplace.
Flare Audio
Another company that is pioneering new uses in an existing category is Flare Audio. The company was founded in 2015 as a professional audio manufacturer. It has since expanded its product offering to include some of the first earplugs that allow users to “turn down” background noise while remaining engaged in their interactions. By developing a way in which consumers can not only block noise, but block only distracting background sounds while being able to stay present in their environment, the company is expanding the category to new customer groups, and is likely to drive share growth in the industry. For example, for autistic people and those living with hearing sensitivities, these devices allow the wearer to reduce some of the noise which triggers the “fight or flight” response, and provide a sense of calm for the wearer. (Source: https://www.flareaudio.com/pages/calmer-life). This application is especially disruptive, as traditional earplugs serve one purpose – to completely block noise, while sound-reducing headphones do not allow the user to continue to hear what is in front of them at full volume.
This application has drawn consumers from the hearing-sensitive community, as well as other consumer groups who are looking to have more minute control over the sound in their lives, including parents, students, and travellers. By expanding on the well-known function of earplugs, blocking noise, Flare Audio has created a new customer sub-segment for the category, and is likely to continue to grow in in-ear devices.
Additional ways to innovate
Launching distinct new formats or creating new customer sub-segments are some of the ways in which brands are innovating to grow their market shares. Other successful strategies include:
- Introducing new usage occasions
- Launching distinct new formats
- Forming industry and category fusions
- Creating new consumer subsegments
Read our white paper How to Be a Disruptive Brand and follow this blog series to see how brands follow the “Renovation, Innovation, Disruption” framework and are successfully innovating within their industries.