What comes after Reverse Innovation?
In a previous post I have argued that evolution from globalisation to reverse innovation as outlined by Vijay Govindarajan is driven not only by the revenue gap between mature and emerging markets but also by the rise of simplicity, a powerful undercurrent that pushes simplicity to emerge as something that is not just cheaper but also more reliable, more effective, more authentic, more beautiful, in short: desirable.
What does this tell us about what comes after reverse innovation? Putting in a chart the 4 phases of the evolution so far, the answer becomes clear.
The next phase of this evolution is coming full circle and designing for simplicity in mature markets for mature markets. Successful innovation is based on closely observing and empathising with customers/users. Simplicity designed in emerging markets for developed markets (reverse innovation) is on the rise because it addresses an unmet need for simplicity, but it will ultimately be beaten by simplicity designed in mature markets for mature markets because the latter will be better placed to observe, empathise and fulfil the need locally.
Evolution has got to follow its course. Before the shift to simplicity occurs in the mindset of companies in mature market, they will have to feel the full impact of reverse innovation. But as usual, there will be pioneers, companies who will disrupt the established paradigm and start designing for simplicity while others still cling to the old model of feature-heavy high-cost products.