1. Adapt an existing product to a new use
Innovation doesn’t even require technology. You may offer a different application for an existing product, a new pricing model, or a new level of support. Or find an entirely different application for an existing product. As an example, De Beers once produced only industrial diamonds, but found a market as well in engagement rings.
2. Pick a specialized technology within an existing movement
Let the heavy lifting on major technology evolutions be done by big players, such as Apple or Google. Think smartphone cameras, as opposed to a new smartphone design. Within all large markets, there are many opportunities for smaller innovations that don’t require a huge investment.
3. Focus on a large opportunity in a low-growth market
High-growth market segments always catch your attention, but also are likely to be attacked by bigger players with deeper pockets. Instead, find an innovation that doesn’t require market growth to thrive–adding technology in a big market segment can be a big win even if the market doesn’t grow.
For example, by most definitions, the retail market for a cup of coffee is mature, but that hasn’t stopped smart entrepreneurs like Roasting Plant from enjoying success by engineering a better cup of coffee. The opportunity is huge within the existing market.
4. Find a niche market where you have unique insight
Experience is a great teacher. If you can tell me with conviction about what you have learned to be a viable innovation opportunity in a specialized area you know well, I might believe that you can produce a return in my lifetime.
This step may also lead to a disruptive innovation in the future.
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