Is your Innovation Program Suffering from “Candy Crush Syndrome”

Is your innovation program overly focused on individual hit products, but lacking an ability to consistently innovate?  You may be suffering from “Candy Crush Syndrome.” Read GameChanger CEO Larry Popelka’s latest Bloomberg Businessweek article to learn how to avoid this disease.

Candy Crush Syndrome is Killing Innovation

Candy Crush Saga, the popular online game, is a great example of what is wrong with innovation in most companies today.The company that makes Candy Crush – Midas Player International Holdings Ltd., also known as – announced last week that it was filing for an IPO, which some are estimating will be valued at as much as $5 billion.

The IPO valuation is based almost entirely on the strength of one product:  Candy Crush, a hot new game that has attracted over 100 million Facebook users – half of which play it daily – making it the No. 1 Facebook app.  While King makes a number of other games, the daily Facebook users for all of these other games combined is less than half of Candy Crush.

The problem with King’s IPO is that product lifecycles in games – as well as many other industries today – have gotten shorter and shorter, so the value of any single hit product is limited.  Successful companies can no longer stake their future on individual products.  They need to develop a capability to generate a steady stream of successful innovations, which King has not yet done.

Zynga, another online gaming company, was riding high in 2010 with Farmville, which had over 80 million Facebook players.  After Zynga went public in 2011, Farmville tanked, and today it has just 5 million daily users, and the share price is down 60% off its IPO price.

Most investors and managers overvalue the success of existing products and undervalue innovation capabilities….

While hit products are important and gain a lot of attention, successful companies like Disney come out with new hits almost every year because they have built a process to generate and test new concepts that consistently work.

Nike is another great example of a company that has the right model. Almost every product Nike sells today didn’t exist 10 years ago, as old styles have lost popularity. Yet revenue has doubled over that time, as new products and styles outsell the old ones.

Many companies are suffering from Candy Crush Syndrome…  In many industries – soft drinks, automobiles, coffee, publishing and cleaning products – established companies have been slow to adapt to shortened product lifecycles and paid the price…. In today’s environment, it’s not what you own, but what you can create that delivers shareholder value…

[Click here to read full article.]

Jumpstart your innovation program. Contact GameChanger today 510-521-7985.