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Are innovation labs still the future of R&D?

06 : 06 : 2017 Retail : Food : Drink
Ikea Space 10 Living Lab Ikea Space 10 Living Lab

Innovation is a never-ending journey rather than a sprint towards a predetermined point.

Victoria Buchanan, strategic researcher, The Future Laboratory

Just two months after abruptly pulling the plug on its Store of the Future initiative, which aimed to explore how future technologies can improve the in-store experience, Target has announced that it is preparing to shut down its Food + Future coLab.

It is the latest in a long line of ‘Future of’ projects and innovation labs that have met a similar fate in the past year, including those created by Coca-Cola, The New York Times, Ogilvy Labs, Microsoft and Disney, which begs the question, what exactly is going wrong?

Call it the technological revolution. Silicon Valley and London’s Silicon roundabout have made being in beta mode cool. According to Capgemini, 88 innovation centres were opened globally between March and October 2016. In an age of digital disruption, our shared understanding of how and why we innovate is being reshaped.

A key issue is that innovation labs have become vehicles for marketing rather than innovation. ‘Change and adaptation are horrendously problematic, so the easiest thing to do is to set up an innovation department because it creates a nice story that you can take to market and stipulate easily,’ says Nicolas Roope, founder and creative director of Poke London. ‘You can fund it because it’s important to everybody, but it’s the same as when you pay your gym membership and believe that this makes you fitter even when you don’t go.’

You have sponsored a hackathon, created a space filled with bean bags and virtual reality (VR) headsets to encourage ideation, and integrated smart mirrors, VR experiences and beacons into your store – you’ve conceptually covered your innovation needs without innovating across the business, but at least it will make for a nice press release.

Business models are built on 20th-century systems and brands have applied technology to everything to adapt to 21st-century expectations, but many have forgotten consumers’ needs in the process.

‘I’ve never met anyone who has been rewarded by a vending machine for laughing, walked through a door marked ugly, got a Coke from a drone or been offered a crisp packet with their face on. I’ve not once seen a member of the public 3D print anything,’ says Tom Goodwin, head of innovation at Zenith Media.

There is also the problem of how we measure the success of innovation labs, which are often tasked with envisaging scenarios and experiences that will exist in 10, 20 or even 50 years’ time. In an age in which legacy brands are driven by quarterly reporting and generally avoid taking risks, people at the forefront of these initiatives are often discouraged from seeing these kinds of projects through. ‘Historically, physical locations powered transactions, and that is what retailers based their metrics for success on – average transactions. But that is not the primary function of the physical location anymore,’ says Greg Satell, author of Mapping Innovation.

Target’s Food + Future coLab was tasked with exploring how food will be grown, sold and consumed in 15 years’ time, but was brought to an end by bad Christmas trading figures, among other reasons. Real progress will always be made a few years down the line because innovation is a never-ending journey rather than a sprint towards a predetermined point.

To create the future is no small thing. With this in mind, are innovation labs really solving a problem, or are they simply creating new problems on top of existing solutions?

To find out more about how to future-proof your brand’s retail strategy, download our Retail Futures Report 2017 or contact us to organise a consultation.