The 4 Types of Marketing Innovation Labs

Marketing innovation labs are all the rage among long-successful enterprises that now find themselves playing catch-up to nimble, tech-savvy startups. The idea is to establish a marketing think tank outside the shadows of internal silos and open the doors to new technologies and customer engagements. But a new study from Forrester Research warns corporate managements to have a clear idea of what they want to be seeing when those doors open.

Considering that the cost of setting up one employee in an innovation lab in Silicon Valley (a popular locale for such units) runs in excess of $225,000, it’s a project worthy of some thought, says Forrester VP Bert Bert DuMars, the company’s principal analyst serving CMOs. Key findings from the study include:

  • Companies looking to force marketing change are best served keeping labs close to home, while those seeking technological inspiration should go afield.
  • Cost-effective “virtual labs” composed of current executives can help ferret out and develop talented innovators.
  • Depending on individual corporate shortcomings and initiatives, most labs rally around one or more of six key goals: digital technology innovation; commerce tech innovation; corporate culture change; technology transfer; new product or service development; and tech startup investment.

“Innovation labs are a way to accelerate marketing concepts, but they require the same level of business scrutiny as any other important business initiative,” DuMars says. “Otherwise they become a source of frustration and failure.”

Forrester discovered four elemental lab concepts in use at more than a score of companies included in the study:

Headquarters Labs:  Less expensive and easier to set up than outpost labs, HQ labs are for enterprises whose primary mission is to drive culture change and accelerate marketing innovation aimed at changing customer behavior. Using on-site talent, these labs can serve as a shining example of what’s possible within current organizations. Chick-fil-A, DirecTV, Nestle, and Nordstrom are among the companies using HQ labs to germinate new mind-sets, says Forrester.

Outpost Labs:  Enterprises that sense they need a direct conduit to new marketing services and technologies set up labs where the action is—in places such as Austin, Boston, New York, and Silicon Valley. High real estate and living costs in these locales make these labs pricey, but Forrester notes that they could pay off for companies looking to buy into marketing-tech startups. Notable organizations fielding outpost labs are Comcast, Ford, Home Depot, and Walmart.

Virtual Labs:  Used by companies as varied as Aetna, Coca-Cola, and 7-Eleven, virtual labs focus on building innovative talent instead of innovation sanctuaries and can be established in headquarters settings, other major employee centers, or outpost locations. Virtual teams aim to partner closely with tech industry leaders, startups, and top digital agencies. For the organization imbued with a clear digital strategy, virtual labs can fast-track innovative concepts and pilot projects.

Innovation Accelerators: Enterprises with enough confidence in their digital strategies and corporate cultures can work with innovation accelerators such as Capital Factory and Atlanta Tech Village to re-create the lab experience in a neutral environment for reasonable monthly fees. Accelerators typically have up to 100 startups sharing space in open office environments, making the interplay highly educational for executives seeking crash courses in technological development. PepsiCo placed its digital innovations team inside WeWork labs in New York to have it in a bubbling cauldron of idea generation.

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