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In part 1 and part 2 of this series ("Five Keys to Engaging the Customer to Produce Real Innovation"), we discussed using voice of the customer (VOC) in defining innovative core products and services.

The focus was on breakthroughs in the basic product, on hitting the home runs. Here, we take a different perspective—using innovation to acquire and retain customers once the core product or service is defined.

As you will see, innovation can occur in all aspects of the business, not just the basic (i.e., core) product. For example, innovation can apply to the sales/marketing approach and to the additional goods and services that are offered in combination with the core product/service in order to make a more robust solution.

You will also see in many of the examples below that a big innovation often results from a series of small innovations.

VOC continues to be critical, since innovation is valuable only if it ultimately benefits the customer. Marketing therefore has a crucial role to play: It typically orchestrates and conducts VOC activities, champions the results throughout the organization, and often acts directly on the customer input.

Now, five keys to using innovation to acquire and retain customers:

1. Expand the scope of your solution

Determine everything that is required in order for your customer to buy your product and be satisfied. Everything includes product extensions, upgrades, and complementary products, of course, but it goes well beyond that. For example, is it easy for the customer to buy and physically obtain your product? Do customers have easy access to information that helps them with their purchase decision? While this is normally considered a routine part of the marketing, it can lend itself to innovation.

Consider the experience of buying a book (or many other products) on Amazon.com. It is easy to find a product using Amazon.com's search capabilities. Once the item is located, there is a wealth of information to help with the purchase decision—reviews, music samples, etc. If the customer decides to purchase, she can activate "1 Click" and the product is on its way. A very easy process—less than one minute in many cases, without leaving your desk.

This ease of purchase, consisting of several smaller innovations and enabled by the Internet, represents a breakthrough in engaging the customer. Note that the basic product—the book, CD, whatever—is the same as before. Here, the definition of the "solution" has been extended to include the presales process, by understanding what is important to the customer up to and during the purchase.

There are certainly many other ways of innovatively expanding the solution definition to better reach and serve customers.

Enterprise Rent-a-Car applies a series of innovations to better serve one of its rental customer segments—people whose car is in the shop. Enterprise proactively reaches these customers by placing rental locations near repair shops, often within walking distance of a dealer who performs repairs. It advertises its services to other repair shops in the area, and provides pick-up and drop-off when the shop is beyond walking distance. It charges rates that are covered by insurance and bills the insurance companies directly, so customers are not "out-of-pocket." By using this series of small innovations, Enterprise has achieved a breakthrough for customer friendliness and satisfaction in this market segment.¹

Think of additional services that you can bundle with your core product or service that will make it easier for the customer to buy and enhance the customer's overall satisfaction.

In most cases, these will not require changes to the basic product—they can be added on, often at low cost, and they often increase revenue and profit more than a change to the core product itself.

2. Enhance the total customer experience

A good experience starts with a high-quality product and good pre- and post-sales customer service, but there are many other steps a vendor can take to enhance the total experience. Consider all of the stimuli to which a customer might react—many of these will be unconventional.