Last week, I faced a room of managers and entrepreneurs, who, after days of riding the rollercoaster of a chaotic market, decided to skip the football on TV and take part in a discussion on innovation. I wasn’t exactly looking forward to an optimistic crowd.
Of course, we all know that companies who invest in new products and skills during a downturn are the ones that come out on top when things turn around, but it’s the last thing you want to hear when you’re facing limited cash, de-motivated staff, and no clear sense of how long it will all last.
Expecting to hear about cost-cutting and ‘focusing on the core’, I was instead bowled over by stories of new initiatives. These UK managers see recession as an opportunity to uncover new ways to grow – but they’re doing it in smart new ways. (Unlike reports of Americans, who seem to be paralysed by a sense of gloom).
The stories shared a key factor. Nearly everyone is using this period to re-connect with consumers and identify people’s big underlying needs – the ones that persist regardless of their budgets.
Today, meeting those needs means doing more with less - taking an under-used asset, and re-thinking it to serve your consumers in a whole new way. Amazingly, one of the most inspiring examples is coming from a very unlikely source: the seemingly stodgy Royal Opera. Covent Garden is partnering with cinemas to broadcast live opera in high-definition to audiences all over the world – at a fraction of the price of an opera ticket. At the same time, the cinemas can charge double the price of a normal entry, while making use of halls and A/V technology that sit idle 70% of the time. A pilot at the Metropolitan Opera in New York sold nearly 2 million tickets in the first two years, and the Royal Opera is hoping for an encore performance.
By partnering with opera houses, cinema owners are tapping into a persistent need – emotional entertainment – and getting into (or even disrupting) a market they never thought accessible – live performance. They’re offering more than a cheaper way to see an opera: it’s an experience that feels totally new – more real that the movies, and thanks to great camerawork, as engaging as a live show. Opera at the cinema may seem to be a value-priced option today, but I suspect that it will still bring in enthusiastic audiences when the economy rebounds.
We know that frugality drives innovation. After all, you don’t need a big budget to create a better solution. All it takes is being willing to reframe the way people see your current offer and try out new ideas. By paying close attention to our consumers’ big, unchanging needs we can build businesses that thrive regardless of recession.
James Moed is Business Strategist at IDEO.