If you’re a fan of Nick Lansley, Head of R&D at Tesco.com (yes, he does have quite a following), then you’ll know from this post on his techfortesco blog, that we are helping Tesco bring together a rather unique event.
In the spirit of customer-led innovation set by people like Dell, with their Ideastorm, and our other client Virgin Atlantic, with whom we worked on the very successful ‘V-Jam’ day (in association with NESTA), we are very proud and pleased to announce that we are helping Tesco do the same; but with an added twist.
The twist is that Tesco.com already has a robust API that allows developers to write applications that allow you to do anything that you are able to do on the Tesco.com grocery website (apart from pay… we thought it best to leave that to Tesco.com itself). What this means, is that an innovation day where we get real Tesco customers in to think through how best we can help them do their shopping and run their households, can have a very tangible outcome. That outcome is quite simply that anyone who wants to can write an application or a website that brings these ideas to life for real, using the Tesco API.
Why would they do this?
Well, let’s assume for a moment that your average developer or web agency isn’t desperate to become the shopper’s friend for free, and I’m sure that most of you think Tesco have enough money to do this on their own, so why would a) developers or web agencies do this and b) why are Tesco asking customers to participate in this in the first place? I mean, Tesco is not a charity, and neither are most of us.
Well, the answer to the first question, is that there’s some money to be made. Tesco has a scheme in place whereby you can earn money by sending customers their way. The exact details of this will be revealed by Tesco in due course, but suffice to say, if you write an application that is so useful to the average Tesco shopper, or makes it easy for a non-Tesco shopper to move over to Tesco.com, then you’re going to make money whenever people use it. In addition to this, Nick is looking to reward the best application (in the judgment of the contest judges – more on that another day too). So it’s also about the prestige and reward of winning!
Why would customers do this? The easy way to criticise any customer-led innovation initiative is “Can’t they come up with ideas of their own?”, or that the company is trying to drain their customers of all their ideas and steal them. But at the same time, have you ever walked into a Tesco store, or an airport, or somewhere else and thought to yourself “I wish they would do X”, or used a website and thought “Wouldn’t it be useful if they did Y”? Most of us have of course. It’s natural that the people who use the service most have the best insight into what is right and wrong with it. Have you ever wished that if only you could communicate that idea to the right person at Tesco that they might actually do it, and how good would that feel?
Tesco is often accused of arrogance, but in my experience, and whatever your view on them, they’re actually one of the least arrogant companies I’ve ever worked with. They are empathetic to customer needs and very open to being helped to make the experience of shopping with Tesco better for customers, no matter whether that help comes from store staff, customers or partners like EMC Conchango. I think it’s actually this lack of arrogance that has helped them become the biggest online grocery store in the world.
All this is simply based on the fact that they acknowledge the direct correlation between how happy customers are with the experience of shopping with them and their own commercial success. This ranges from the usability of their shopping site, to how much money they can save customers. All of these directly lead to a more successful (easier, faster, find the things you really like for the budget you have) shopping experience, but also to Tesco doing well as a company – which of course keeps them in business and I think most people understand that this is generally what companies have to do! I guess this attitude is all very neatly distilled in the ‘Every Little Helps’ tagline.
Customer-led Innovation & Open Innovation
Here at EMC Conchango we are doing a lot of work at the moment helping brands with the way that they ‘do’ innovation. Innovation is a critical trait to have in recessional times, because it’s the way in which you begin to differentiate yourself in the marketplace and drive loyalty and customer acquisition without simply slashing prices all the time. As we would say “Darker times require brighter thinking” – it’s not exactly “Every little helps” but you get the idea!
Doing innovation in a way that is risk-mitigated is hard. Having ideas is relatively easy, but determining which ones are most likely to work, and exactly what is the best way to execute them is harder. Large organisations tend to find this harder than small ones, and so coming up with techniques and innovation frameworks that allow big companies to behave much more like small companies in this respect is a lot of what we are doing at the moment.
The customer-led approach is a good one, but it has to be very carefully balanced with a user-centred approach, which is not the same thing at all. What customer-led innovation does is provide insight in a pretty unique way, but it’s then down to people using good user-centred or goal-directed design to make these things work.
All this goes to prove that nobody in isolation can deliver really great user experience and compelling functionality in a way that works with users, but also drives business value. Instead it takes collaborations between people of differing skill sets and different backgrounds and perspectives.
In addition, this event demonstrates attributes of open innovation. Where companies innovate, but don’t keep their methods or ideas secret from their customers or their competitors. Instead, they do it openly, in order that the ideas and the execution of those ideas become the best that they can be through collaboration. The main thrust of this is to enable a wide contribution from customers, but naturally it means that competitors often get to hear about the thinking as well. This isn’t something we try to hard to protect against, as the benefits outweigh the potential loss of competitive advantage.
The company that originates the thinking doesn’t always get to action it first, but usually they are already a good few steps ahead, so are usually in the best position to be able to execute it best and fastest and of course it was developed by their customers, not their competitors, so naturally it is more likely to succeed for them than anyone else. There are also often great ideas that go unused because one company has very different priorities to other companies, or that it requires a wider consensus or collaboration to make it viable. If those other companies are able to tap into the stream of innovation, they can also contribute in situations where it is mutually beneficial.
Why not keep the ideas secret? Well, companies have done this for years of course, and they will continue to do so for certain things, but for example when Microsoft or RSA (an EMC company) come up with a better way to make credit card transactions more secure, why wouldn’t they collaborate openly on the protocols so that everyone can benefit? This ultimately drives everyone’s business because it means more people are happier to buy online, so it’s a win for customer and industry alike. (I’m not saying they have done this by the way… it’s hypothetical! But take a look at how RSA are looking at how security enables innovation… quite interesting.)
What to expect
What the Tesco Innovation Day will provide are three things:
- The insight: Through working with customers in the first part of the day, we will drive out some good ‘stories’ about how life could be better, in so much as it relates to their dealings with Tesco.
- The tools: In the second part of the day, the more digital amongst you will be invited to take a look at the Tesco API to understand its possibilities and the technical in’s and out’s of how it works. You’ll then be taken through the insight that was distilled from the earlier session with customers, so you can pick and choose the ideas or apps that you think you can best execute on.
- The incentive: Not only is there a prize, but the incentive of an ongoing revenue stream for whomever takes forward an idea is there too. This applies not only to the implementers who turn up to work out what’s the best application to develop, but also to the customers in the first part of the day. If you are a participant in the first part of the day and you’ve got particularly interested on a certain idea and want to help pursue it, we will be match-making people who are prepared to invest time and expertise, with the designers and developers who can make it happen. In this way we hope that partnerships can form for mutual benefit so that nobody will ever feel like they weren’t given the opportunity to profit from their hard work and inspiration and so nobody feels that they were taken advantage of. In our experience, customers who contribute to days like this get most of their reward from the satisfaction of having contributed, and made their own and other people’s lives better (provided that they see the results of their work), but if they have the appetite to invest more to get more out of it, then we want to help make that happen too. Which means that mostly they don’t come just for the goodie bag!
What next?
Take a look at Nick’s blog for more detail on the Tesco attitudes to this event and what they hope to get from it. The date is set for August, and from June we’ll be opening applications for attendees to both parts of the day.
Getting in will be harder than you might think… it’s not quite Big Brother, or Britain’s Got Talent, but we will be asking applicants to justify why they are the best people to be there – so be prepared for that one. These days are generally incredibly rewarding for all involved, yes, really, they are – particularly when the fruits of their labour become very tangible very quickly, so get your thinking caps on…
Keep an eye on www.techfortesco.com for up to date logistics details.