Growing ‘share of innovation’ in the industry from 10% to 50%
As the world’s leading brewer, the ambition of Anheuser-Busch is to lead future growth, by staying in tune with evolving consumer needs and developing new products in beer and beyond. The company keeps pushing the boundaries with new tastes and experiences to provide more people with more choices in more places. That’s why they have embraced a new KPI in their organization: ‘Share of Innovation’. This ‘share of innovation’ is a simple formula: ‘revenue generated by new Anheuser-Busch products’ divided by ‘total revenue generated by new product launches in the industry’. They have taken their share of innovation from 10% of the category in 2017 to 50% in 2019 through the people-first process outlined below.
The new Anheuser-Busch Innovation Machine: iWeek
In 2018, Anheuser-Busch started a strategic initiative coined ‘iWeek’ to meet this objective and invited InSites Consulting as a partner to shape this people-first approach towards innovation. iWeek’s core is a one-week innovation event, taking the A-B team away from their daily environment and responsibilities. Strategizing ahead of this innovation event is critical for a successful outcome. Part of the preparation was about defining the areas in which to ideate, starting from consumers insights and problem statements. To fuel inspiration for iWeek, we did not only leverage previous trend and research reports, but also introduced more creative and immersive techniques. For example, we inspired further ideation through crowdsourced ideas from our creator network eÿeka, a global pool of +400,000 creatives across 164 countries. And we set up online research communities to engage with diverse groups of consumers, the A-B team even embarked on in-market excursions to directly connect and empathize with target consumers on a personal level.
During iWeek, keeping consumers and their needs at the center of innovation is vital. But typical consumer research cycle times are slow. A-B needed an approach that could accelerate the creative process instead of slowing it down. Therefore, we adopted overnight idea screening as a key method to create short consumer feedback loops. It is powerful for the teams to submit their ideas at 7 in the evening, and get polished results and recommendations at 9 the next morning. We made this work by leveraging time differences and our global team members across three continents.
“Overnight we were able to test with 5,000 consumers, in only about a 12-hour period. We’re using technology in order to really move faster than we’ve ever moved before, and put consumers at the center in a way we never have before. Even when living and breathing innovation, it’s incredible to see how many new ideas our teams are able to generate. They continue to push the envelope, which really gives me confidence that we can lead future growth.” Jake Kirsch, VP Innovation at Anheuser-Busch
In 2019, iWeek evolved into iSemester – taking on an even more central position in strategy and planning at A-B. Part of the ideation was hosted ahead of the innovation event, in different break-out groups. These groups got hands-on with insights from the in-market excursions and online communities, to craft consumer tension statements and create first ideas. Before iWeek, 150 disruptive ideas were already crafted and tested in 40+ hours of ideation and six overnight screeners. This allowed for even more A-B teams to contribute during iWeek, adding a lens of feasibility and viability, and resulted in ideas that were not only desirable for consumers but could also be launched successfully in-market.
More and faster innovation
The iWeek approach led to faster innovation for Anheuser-Busch. The process execution – from insight to shelf – was reduced from two years to less than 100 days. Not only is this faster, it also allows the company to launch more new products. As a result, A-B’s share of the industry innovation volume grew to 50% in two years (up from 10% before iWeek). In 2019, they were responsible for six out of the top 15 share gainers in the industry. And overall, the brand continued to grow topline revenue in the US.
“This year was a big step up from what we had in the years before. The focus was really to bring consumers close to the teams here at iWeek. The process really started way ahead of iWeek. Even before we come here together as a team, we spend a lot of time to identify the consumer problems we have to solve. And then come here to really implement our mentality of bringing people to the center, to make our innovations people first.” Dafne Hefner, VP Consumer Strategy & Insights at Anheuser Busch
Over time, the group of stakeholders involved in iWeek – both from A-B and strategic agency partners – expanded, democratizing involvement in these types of strategic workshops.
“Sometimes we think there’s no more ideas within beer. But I think this week has really identified some really great opportunities within beer. It just energizes the people that are working on the brands, the people that are associated with the brands. Folks leave this week with that energy and positive feeling.” Pat McGauley, Anheuser-Busch Innovation Alumni
Mid-March 2020, ‘stay-at-home’ orders and other social distancing measures were implemented in the US in response to the global COVID-19 pandemic. The beer industry came under pressure after the closure of the on-premise channels and the cancellation of major sporting events. However, Anheuser-Busch was able to leverage learnings from other markets like China and South Korea to quickly and efficiently adapt their operations to continue supplying the market and meeting consumer demand. It’s clear that people-centered innovation will be a priority more than ever to excite consumers with new products and opportunities.
