Retailers and wholesalers innovate differently. Their activities are not reflected adequately in the traditional and conventional measures of innovation.
Everyday innovation provides variety in product, price, format, channel and experience. The best businesses innovate to deliver the right mix of products at the right price to customers and must constantly strive to better meet the final consumers’ evolving needs.
Retailers and wholesalers are more likely to engage in open, collaborative innovation than many other sectors and will place as much emphasis on non-technological as technological innovation, and also combine both service and product innovation.
The lack of privacy available in a highly competitive public market, such as retail and wholesale, means that firms often prefer to innovate incrementally or start small, before rapidly scaling up hitherto unseen innovative activities.
Many larger retailers and wholesalers have developed authoritative and highly successful private label brands in collaboration with suppliers. Private labels increasingly offer consumers easier choices around niche requirements, such as ethically sourced ingredients, special dietary requirements, lifestyle choices, cross-cutting ranging propositions such as baby products.
Barriers to the successful exploitation of innovation in Europe include inter alia a lack of visibility and awareness from both policymakers and retailers’ perspective, costs and business risks associated with radical innovation projects, skills, and a number of regulatory constraints.