Emphasizing an Innovation’s Value

Learning Objectives:

• Identify the principles for communicating the value of an innovation effectively
• Create a messaging strategy based on the principles of communication

So far, we have reviewed frameworks for evaluating how difficult it might be to communicate an innovation’s value. What about actually creating a communications strategy? How can you maximize the effectiveness of your presentations to users and stakeholders?

To start, let’s review the first public reveal of the iPod, Apple’s portable digital music player that helped disrupt the music industry in the early 21st century.

Pay attention to how Apple’s then-CEO Steve Jobs builds the audience toward the innovation as a solution, increasing and emphasizing the user’s perceived benefits while minimizing the potential costs.

In 2001, Steve Jobs introduced the iPod, Apple's portable digital music player. Though portable music players had existed in the marketplace for many years, none dominated the market, and it would take the iPod years to achieve that position. But in his first introduction of the device, Steve Jobs masterfully addressed users' reservations about costs and benefits.

Let's review some important points from his talk.

He begins by stressing that music is a part of everyone's life. It is a part of our identity. Around the world, we are united by our passion for music. No one has yet found the recipe for dominating the market of digital music. This is where Apple can step in.

The portable options at the time were CD players, flash drives, MP3 players, and hard drive jukeboxes. In terms of price per unit of storage, the hard drive was massively ahead of the competition. For example, a CD player cost $75, but only held 15 songs. That's $5 a song. The hard drive was $300, but it held 1,000 songs, only $0.30 per song. This is where Apple would compete.

Apple's product is called the iPod. It is an MP3 player that supports a variety of high-quality formats, and because it holds 1,000 songs, you can bring your entire music library with you. How many times have you gone on a trip and realized you didn't bring a tape or a CD that would be perfect? The iPod fits your whole music library in your pocket.

The iPod represents three breakthroughs, and the first is being ultraportable. The ultrathin hard drive has 5 gigabytes of space with a FireWire connection to transfer songs rapidly. You can download a CD to your iPod in 10 seconds. Your whole library can be transferred in 10 minutes. Its battery lasts for 10 hours but charges in only one hour. You can use the same cable for transfers and charging, but there is a separate charger for outlets, too, if you're really on the go.

At the time, you may have said, my MacBook is already portable. It has all my songs on iTunes and I can carry it with me. Why do I need another device? The MacBook is portable, but the iPod is ultraportable. It's smaller than a deck of cards and lighter than a cell phone. In fact, the first model was in Steve Jobs's pocket at the time, and he pulled it out to applause.

Steve Jobs was masterful at minimizing the perceived costs of an innovation, while also emphasizing its benefits. More specifically, in his speech introducing the iPod, he employed these communication strategies, which are general enough to be applied to other innovations as well.

Curiosity before content means that if you spark interest and gradually build positive expectations, you lay the foundation for ending your message on a high note. Because people are naturally resistant, you want to draw them in and make them interested.

Options before solutions means listing other options as a way of calling attention to the desired one. Note how Steve Jobs discussed the overall portable music market first, which built curiosity. This curiosity increased as he explored the other options for digital players at the time before revealing Apple's solution.

Make it personal means establishing a personal connection with consumers. Steve Jobs made the iPod personal by grounding the discussion in everyone's shared love for music and highlighting the common frustrations that people had in the current context, like forgetting to bring their favorite music with them on a trip. He also put the user in control, saying this is your music in your pocket, which also helped users align the innovation with their own identities as music lovers.

Finally, in his presentation on the iPod's ultra portability, Steve Jobs used the strategy of psychologically comfortable and easy to adopt. He noted users' present gains from the innovation through its ease of use features and established positive expectations for the future. This device would be part of the Apple brand, so it would connect with other devices, too.

Demonstrate to communicate can mean letting users interact with the innovation or showing positive results, but Steve Jobs made it dramatic by unexpectedly pulling the iPod out of his pocket.

Principles for effective communication can be summarized as follows:

• Curiosity before content: Draw people in and spark their interest before gradually building positive expectations.
• Options before solutions: List the other options available as a way of calling attention to the desired one.
• Make it personal: Establish a personal connection with consumers, e.g., by highlighting common experiences and helping users align the innovation with existing aspects of their identities.
• Psychologically comfortable and easy to adopt: Explain the benefits of the innovation and emphasize its ease of use.
• Demonstrate to communicate: Let users interact with the innovation directly, or provide concrete examples of positive results.

Now, let’s consider another example. Earlier, we briefly explored the example of the inflatable bicycle helmet created by Hövding. The device is a battery-powered collar that deploys an airbag when it senses a sudden, dramatic increase in acceleration.

The helmet launched with a $600 price. As of 2019, the price was down to $310, 185,000 units had been sold, and 4,000 had deployed in an accident.

How might you use the principles of effective communication to maximize the Hövding helmet’s perceived benefits, and minimize its costs?

• Curiosity before content
• Options before solutions
• Make it personal
• Psychologically comfortable and easy to adopt
• Demonstrate to communicate

You could have approached this from a variety of perspectives. Some of the perceived costs to keep in mind include:

• Price: At $310, the helmet matches the price for top-of-the-line equipment. Users’ status-quo bias will have them expecting at least that value, and likely more.
• Trust: The Hövding helmet requires a huge amount of trust on the part of the user that it will work.

With that in mind, you could, like Steve Jobs, begin with an overview of the market for bicycle helmets (options before solutions). It would be important to stress the pain points that current helmets do not address: unfashionable, not as portable. The Hövding helmet only appears when you need it (make it personal). This could be followed by a demonstration, perhaps a testimonial by someone who was saved by the device (demonstrate to communicate).

To build curiosity before content, you might create a narrative highlighting that traditional bicycle helmets are supposed to be replaced after a serious accident: They may still look safe, but they are not. This point may interest the audience, and build psychological comfort with the idea of the innovation (psychologically comfortable & easy to adopt).

The five principles for communication help you overcome the status-quo bias and present your innovation’s most appealing factors (relative advantage, trialability, simplicity, etc.) in a structured way.

Just as developers need to reframe the problem in the clarify phase, you may need to help users reframe their view of your new product, service, business model, or strategy. Taking a user-focused approach to communications allows you to do this.

Note that the principles of communication and Everett Rogers’s five factors of innovations are complementary tools. If your innovation has high relative advantage, consider highlighting it using curiosity before content and options before solutions.

Likewise, if you believe your presentation is lacking a personal element, consider highlighting the innovation’s compatibility.

The following table highlights which of the five factors are best supported by which communication principles, and vice versa.

In the video transcript that follows, CEO of T-Mobile Mike Sievert makes a presentation on the simplicity of T-Mobile’s innovations. As you review, note how he makes the service seem easy to adopt, and how he leverages other principles of communication, like options before solutions, curiosity before content, and make it personal.

One of the concepts we've pursued since the very beginning is simplicity. This industry makes things so complicated. I named our very first Un-carrier move, Un-carrier 1.0, Simple Choice. And the idea was to start to bring more transparency to this industry so that you can see what you're paying for.

The industry used to obfuscate what you paid for a device with what you paid for the monthly service, and render none of it transparent, so that you would never know exactly the components of your bill. And that creates distrust. Simplicity and transparency create the opposite, which is trust. And trust brings about the willingness of people to invest with us further.

And so in everything we've done, we've tried to make this industry simpler, and simpler, and simpler. Because if we're honest with ourselves, it is simple. We, the industry, are the ones making it complicated. In fact, one of our Un-carrier moves, the 13th one we did, called Un-carrier Next, was taxes and fees included.

We decided to just take this leap of faith that says, what if we advertised a rate plan, and we told you it was $50 a month? What if when you got the bill, it was $50 and 0 cents, just like we told you it would be? And to get that across to people, a big piece of what we need to do is to speak their language and let them understand how simple we're being. And that's ultimately what good marketing has always been about.