Innovation workshops help teams get aligned and clear on a new direction they can take into the market place.
But innovation can feel very murky and ungrounded. Having a frame for innovation helps guide the direction.
Let's dive into the intriguing concept of a type of market innovation called "low-end disruption," a term coined by none other than Clay Christensen.
The Heart of Low-End Disruption Innovation
Imagine a scenario where there's a vast pool of potential customers who yearn for a similar product or service but are unable to afford the upscale offerings presented by the big players.
Low-end disruption enters the scene as the unsung hero, addressing the needs of this untapped market segment. It's the underdog that enters the competition with a "good enough" product or service at significantly lower prices.
These agile newcomers find ways to innovate within tight budget constraints, slowly but surely ascending the market ladder by providing more value for less.
The Brilliance Of Low-End Disruption
Here lies their ability to start from the bottom, embracing simplicity and cost-efficiency as they learn the ins and outs of the industry. Think of it as a journey from the grassroots, gradually gaining momentum while eating away at the market share of established players.
A Simple Example
Consider the analogy of Netflix - a name synonymous with modern entertainment. Offering a vast library of shows and movies at a monthly fee of $15, they disrupted the traditional cable model and the costly movie rentals of Block Buster. It's a prime example of low-end disruption - making quality entertainment accessible to the masses.
What To Watch Out For
Yet, as the saying goes, every rose has its thorns. When the big guns decide to withdraw from a particular market segment, the technology and services become more accessible and known.
Result? A surge in competition creates a race to the bottom and challenges the sustainability of high profits.
Netflix's story beautifully illustrates this paradox. While they initially revolutionized entertainment, the arrival of Disney+, Amazon Prime Video, HBO Max, Paramount +, and Pluto TV signals a new era of streaming competition.
So, remember, "low-end disruption" is more than a term; it's an innovation strategy that reshapes industries and opens doors to a world of new possibilities.
This is a strategy that an innovation workshop can help you and your team get clarity on. If you are looking for a guide to help your team along that innovation journey, we are here to help!
Fill out the form below to see how we can support your innovation goals!