Renovate Before You Innovate Why Doing the New Thing Might Not Be the Right Thing

According to bestselling marketing expert Sergio Zyman, many companies rely too heavily on innovation to solve their problems. Whenever a brand or business gets old and tired, the impulse is to scrap it and start over with something fresh. It sounds great, but more often than not, innovation simply doesn’t work. Zyman knows this firsthand— he was the chief marketing officer at Coca-Cola during the disastrous launch of New Coke.So what’s the alternative? Zyman now preaches the power of renovation, not innovation. Recapture the essence of your existing brands, products, and core competencies, and do more of the things that made you great in the first place. For instance, Coca- Cola’s essence was about authenticity, continuity, and stability, and New Coke undermined all three qualities. It seems obvious in retrospect, yet too many managers are so impressed by innovation that they approve ideas no one will buy, such as premoistened toilet paper or smokeless cigarettes.With Renovate Before You Innovate, Zyman explains the tools managers need to revitalize their marketing strategies and improve their growth rates. This book will challenge the conventional business wisdom and help companies make smarter decisions.

Sergio Zyman is the bestselling author of The End of Marketing as We Know It as well as the chairman of the Zyman Group, a strategic consulting firm whose clients include EDS, ConAgra Foods, Alcoa, and Blockbuster. He is also the namesake of Emory University-'s new Zyman Institute for Brand Science.

Armin A. Brott is a business writer.

Introduction Everywhere I go, it?s the same story. Over lunch with a client, the VP of marketing talks my ear off about all the new products the company is planning to introduce. At the quarterly meeting of one of the firms whose board I sit on, the CEO spends twenty minutes describing the new markets the company is getting into and the acquisition deals they?re working on. And these guys aren?t alone. Overall, more than 60 percent of S&P 500 firms incorporate the concept of innovation into their mission statement, use the term ?innovation? in marketing and branding communications, or cite innovation as part of their strategy in their annual reports.What?s the big deal with innovation? Well, most corporate execs know this basic formula for business success: Increased sales lead to increased cash flow, which in turn drives growth. And ultimately that?s what it?s all about: Firms that have a proven history of top-line and bottom-line growth get rewarded by Wall Street with higher valuations (price-earnings ratios) than other companies in the same category. Just think of Coca-Cola, L?Oreal, Procter & Gamble, and Sony. However, since many attempts at marketing have failed to create both top-line and bottom-line growth, CEOs have decided that the only way to drive growth is to change the rules of the game, gut the old system, and build a new one from the ground up. In other words, innovate. Most dictionaries agree that innovation is ?the act of introducing something new? or ?a new idea, method, or device.? Both of those definitions work for me, but I think it?s also fair to say that innovation is ?using your existing assets and core competencies to do something different from what you?re already doing.? This fixation on innovation has spawned an entire industry of consultants and authors and businesses whose entire purpose in life is to support and promote innovation. If you do a quick search on Amazon.com for ?business innovation? you?ll find two thousand titles. And if you Google ?innovation consultant? you?ll get more than 450,000 hits. Two of the biggest innovation gurus these days are Tom Peters and Gary Hamel. We?re all Michelangelos, they say. We need to forget everything we know, ?de-risk? unfamiliar opportunities. Distance is dead, destruction is cool. Innovation rules! Sounds fantastic and inspiring, doesn?t it? And it is?except for one small thing: For the majority of companies out there, it just doesn?t work. All it offers is a quick fix?kind of like a sugar high: You feel better for a while, but when the effect wears off you?re in worse shape than when you started. At its core, this approach to business growth is simply lazy. Actually, it?s worse than that; it?s dangerous. But both Peters and Hamel have struck a chord with a broad base of companies that are now trying to grow their business by turning their back on what they need to do first, which is fix their basic value proposition?what it is that they offer their existing and prospective customers. So now we?ve got a bunch of companies that have forgotten all that boring stuff that made them successful in the first place and are getting into areas they don?t know anything about and have no business being in at all. A lot of these companies are showing their commitment to this strategy by creating a new position: CIO. No, that?s not Chief Information Officer. It?s?yep, you guessed it?Chief Innovation Officer. And these CIOs are rattling on and on about how the company is ?retooling? and ?charting a new course? and ?exploring new opportunities.? And let?s not forget about ?driving double-digit top-line growth.? The fact that all that top-line growth will probably come at the expense of the more important bottom line doesn?t seem to bother anyone. Except me. In my view, innovation is just another word for ?giving up.? It?s saying that things are so bad that it?s easier to get into an entirely