Why corporations stifle innovation. Fever-Tree.
August 28, 2018
By Gonzalo López Martí – Creative director, etc / LMMiami.com
- It is no secret that innovating from within can be extremely hard, if not impossible, at large corporations.
- Part of the reason is that most large companies have a single minded, volume-based, low margin business model: make industrial amounts of one thing and one thing alone, inundate the market with it.
- In certain organizations, moreover, innovating is frowned upon.
- It is regarded as shameless self-promotion.
- Are you trying to stand out?
- Are you angling for a corner office?
- You’re not thinking of cutting in line, are you?
- The etiquette of the totem pole has unwritten rules akin to zealotry.
- Add to the equation that it is close to impossible to know who’s responsible for what at large organizations.
- Who should be given a fat bonus?
- Whose head should roll?
- Why are sales up this quarter?
- Seasonality, happenstance, business acumen, inertia?
- Who knows.
- Promotions and bonuses are rarely granted on merit.
- It is all about politics.
- Given this reality, large companies are usually destined to shopping around for tried & true turnkey innovation outside of their confines.
- And to pay a handsome premium for it.
- Enter Fever-Tree Premium Tonic Water.
- Let me give you a little context.
- Gin & tonics are all the rage.
- Again.
- It was a matter of time until the trailblazers of sophisto mixology brought them back from the limbo of passé cocktails.
- However, as is usually the case with fashion comebacks, the latest conventional wisdom of snobbery came with a twist (no pun intended): it is not the gin but the tonic water what really matters.
- The latest star of tonic waters?
- You guessed it: Fever-Tree.
- The king of the category.
- Or should I say the queen.
- A UK-based startup, barely 12 years old.
- Publicly traded in the London Stock Exchange under the ticker symbol FEVR its share price jumped from roughly £1.8 in January of 2015 to close to £40 last month.
- The kind of multiple that would make Silicon Valley con artists wet their undies.
- To judge by its meteoric growth and marketing wizardry, it is a matter of time until it is sold to one of the big players in the liquor or soft drinks industries.
- Wait.
- The name Fever-Tree is kinda odd, ain’t it?
- There’s an explanation: tonic water, aka quinine water, was and in some cases still is made from the bark of the quina tree.
- A species originally found in Perú and, to a lesser extent, adjacent countries of the Andean region.
- Back in the day, the quina tree’s bark was supposed to have shamanic medicinal properties.
- Hence the brand name.
- Anyhoo.
- My point is: this is the kind of success story that would’ve NEVER happened within the walls -physical or otherwise- of a large global corporation.
- Premium tonic water?
- Expensive Schweppes?
- Fancy Canada Dry?
- Get out.
- And the name.
- A sitting duck for the legal eagles, assorted marketing naysayers, devil’s advocates and other usual suspects.
- Can you imagine the look on the face of a legal department benchwarmer or a market research charlatan if someone went to them with the idea of launching a brand under the name Fever fucking Tree?
- Are you implying that this product infects people with some sort of tropical disease?
- Or, conversely, are you trying to say that it carries medicinal properties?
- Class actions suits!
- Hand wringing.
- Hyperventilation.
- Fever pitch.
- Meltdown.
- Whatever it takes to justify your salary as a midlevel corporate drifter.