Recently while travelling on one of the Low Cost Carriers (LCCs), I was amazed by the on air shopping platform the airline had initiated which provided customers with an option to "touch and feel" and bid for products ranging from fashion accessories (glares, pearl necklaces), watches for him and her, sports bags and many such items of great value to travellers. I say great value, primarily due to the positioning of these offerings- pricing (greatly discounted), product choice (keeping travel needs, gifting relatives during vacation in mind), channel (instant availability), packaging and promotion (attractive bid pamplets with detailed description of products and visual enticement).A sneak peek into the additional biz that the airline gained by this innovative channel revealed the following data-

Total Transactions - 27 Total sale value - INR 28,000 (average sale INR 1027) *

Assuming 10% margin, INR 2800 is what the airline gained for just being innovative in forming a strategic alliance with a direct marketing company. Imagine 20 flights a day and assuming an average margin of INR 2000 per flight, the airline still makes INR 12 lacs a month. A meagre amount one would say, but when the gestation period of this model demands break even in over 2-3 years, any such cash inflow is still high enough to cover many "cost cutting intiatives". Other such instant innovations-

• Kingfisher - live entertainment on air - an innovation for the new Indian traveller. (sell air space to channels/broadcaster)
• Tata Sky- Showcase- buy DVDs and music sitting at home- attractive promotion backed by Tata Sky (margin on sold items)

The primary highlight of the above illustration is the gain a business can achieve by innovating "market ready" concepts. Not every innovation is as rewarding, what really works for the end user instantly is what one should call "market ready innovation". The impact is instant, a boon for businesses which look at cutting costs on a perenial basis, where any cash flow, however little substantial means a lot; where competitors exist like a bunch of margin eaters. With so much of standardization in operations, customers rarely see the difference between multiple operators, such innovation adds the essential differentiating factor (although one cannot oversee easy copying by competitors and pioneering disadvantages) .

The difference lies in the fact that there is not just one aspect to R & D in companies; R&D invests a lot of time and money in inventing, testing, re-inventing, trial markets, final launch and hence benefits ...where again sadly in new products...close to 80%** fail. My argument is, one reason to such innovation failure is the lack of "market ready" thinking. Market ready thinking, simply put, is closer to customer needs and expectations; with minimal loss of time, customers adopt the innovation as a value add; implies the innovation should utilize the synergies in existing assets for smooth adoption. A market ready mind set should be ingenious to look at "additional oppurtunities" through the same business or through "strategic alliance" with another business. Remember, innovators also exist outside your product line...outside ur business...the eyesight has to be alert and powerful enough to visualize such "innovating catalysts".

* Approx data from in-flight personnel.

** % Reference- Philip Kotler on new products.