Product Innovation: Shaping the World as We Know It

Written by Differential on March 08, 2023

In a previous post, The 3 Types of Innovation: Product, Process, & Business Model, we provided a general overview of innovation efforts. In this series, we will dive further into product innovation.

What is Product Innovation?

Product innovation is the most visible type of innovation, as it involves making changes to the goods or services offered. One of the main goals of product innovation is to increase the value that a company offers to its customers. By creating products that are better, faster, or cheaper, companies can differentiate themselves from competitors and capture new market share. Product innovation can also help companies to stay relevant and adapt to changes in the marketplace, ensuring their long-term success.

Methods of Product Innovation

While product innovation is a part of the larger scope of innovation, there are ways to break it down further still.There are two main methods of product innovation: incremental and radical.

Incremental innovation involves making small improvements or modifications to existing products, while radical innovation involves developing completely new and innovative products. Incremental innovation is often used to maintain a company's position in the market, while radical innovation can help a company to disrupt the market and create new opportunities.

Conditions that Lead to Product Innovation

One of the most important drivers of product innovation is customer feedback. By listening to customers, companies can identify areas for improvement and develop new products that better meet their needs. Through this research, companies can then innovate and bring about better products and solutions based on favorable conditions related to technology and markets.

As new technologies emerge, companies can use them to develop new products or improve existing ones. The development of new engineering methods or software capabilities can enable the creation of new products that were previously impossible or impractical.

Successful product innovation requires a combination of creativity, market knowledge, and technical expertise. Companies must be able to identify market opportunities, understand customer needs and preferences, and have the technical skills to develop and bring new products to market. This often requires collaboration between different departments within a company, including research and development, marketing, and sales.

Three Examples of Product Innovation


Flying was a complete departure (get it?) from the status quo. Before the invention of airplanes, people had to rely on other modes of transportation like trains, ships, and cars to travel long distances. Airplanes revolutionized the way people traveled by providing a faster and more efficient means of transportation.

Over time, airplanes became larger, faster, and more sophisticated. The development of new technologies like jet engines, radar, and computerized flight controls made it possible for airplanes to fly faster, higher, and with greater precision.

Bagless Vacuum Cleaners

Vacuum cleaners have been a household staple for decades, but it wasn't until the introduction of bagless vacuum cleaners that cleaning became a less messy task. Somehow, innovators found a way to make the machine that picks up dirt be clean in and of itself. Gotta love innovation!

The innovation of bagless vacuum cleaners is a great example of how companies can use technology to improve existing products and create new solutions that offer more value to customers. By identifying a pain point in the cleaning industry and finding a better solution, innovators have successfully changed the way we clean our homes.


This is a bit complicated. The airplane and bagless vacuum cleaner examples fit nicely into their own buckets. Airplanes were a completely new option. Bagless vacuum cleaners were an improvement on something that existed.

Smartphones are advancements on the prior basic mobile phones. But at the same time, they’re completely different… they’re powerful computers that happen to take the form of a phone. And while technological advancement made this all possible, perhaps they were made possible by the strong desire to delight customers in a massive way.

Smartphones, while a mulit-faceted example for a case study, highlight an important question that innovators ask: How can I take the familiar and add some magic?

Continuous Improvement

Product innovation is a powerful force that drives progress and enhances the quality of our lives. From airplanes to bagless vacuum cleaners, product innovations have changed the way we live, work, and play. Product innovation is all around us. We fuel it through our desires and build it using our creativity.

At Differential, we understand the importance of innovation and continuous improvement in meeting the needs of our clients and customers. Our team of experts is passionate about creating innovative solutions that drive business success. If you are looking for a partner to help you innovate and stay ahead of the competition, we are here to help. Contact us today to start a conversation about how we can help you achieve your business goals through product innovation.