The Channel Innovation Checkup is a tool and part of the “Ten Types Of Innovation” macro method (also described here). The eighth of the “Ten Types Of Innovation” describes innovations that affect all the ways (channels) in which a company’s offerings reach users and customers.
Although the
While Internet commerce has rapidly gained in importance in recent years, brick-and-mortar stores still remain important – especially when it comes to providing a special shopping experience. Skilled innovators in this field often find multiple and matching ways to get goods to customers. Their goal is to ensure that customers can have their products when and where they want them, minimizing friction and increasing delight in the process.
Channel innovations are specifically tailored to the product group and the industrial context. “Flagship stores can be a very value-added innovation. Recognizable stores present a brand and offerings permanently in a city, while “pop-up stores” can be more useful with a brief, flashy appearance in a vacation spot. Internet trading offers completely different advantages: On the retailer side, it reduces costs and increases profit margins. Multi-level marketing is also a channel innovation: the effort of advertising is distributed on the shoulders of many small, medium and large distributors who communicate the benefits of a product directly to the end customers.
Successful channel innovations in practice:
– NESPRESSO: Nespresso’s capsule system is a “Product Performance” and “Product System” innovation. With the purchase of the machine, customers are bound to repurchase the Nespresso capsules. But all-encompassing channel innovations have ensured the system’s spread since 1996. These included company-owned stores and coffee shops, kiosks in partner stores such as Macy’s and Boomingdale’s, the online Nespresso store (which uses emails to remind customers to reorder capsules), and several business-to-business channels. These included partnerships with hotels such as Ritz-Carlton and Hyatt, and airlines ranging from Lufthansa to Quantas Airlines. If that’s not enough, there’s even a Nespresso Someliers Club that teaches which coffee goes with which food and wine.
– Amazon: The closed ebook system “Kindle” enables very fast buying and reading of digitized books.
– Xiameter: Chemical giant Dow Corning opened a web-based platform in 2002 for direct sales of silicone beads needed to produce plastics. The intermediary trade was completely eliminated and the prices for companies that did not require technical support were drastically reduced. If you know exactly which fabrics and colors you need, you can put together your own order from thousands of options. This channel innovation works in parallel with the parent company’s traditional sales model.
