Estimated reading time: 2 minutes

Dan’s Biz Bookshelf: ‘Costovation: Innovation That Gives Your Customers Exactly What They Want—And Nothing More’

Costovation by Stephen Wunker and Jennifer Luo Law delivers a refreshing perspective on innovation by focusing on "just enough" innovation—creating products and services that serve the customer's needs without unnecessary features or costs. This book is a revelation for business leaders seeking effective strategies when flashy, expensive innovations often dominate the market. The authors share how companies can thrive by delivering targeted, cost-effective innovation by offering customers precisely what they need.

The most valuable takeaway is the concept of "costovation" itself—a blend of cost efficiency and customer-focused innovation that doesn’t compromise on quality or customer satisfaction. Wunker and Luo Law make a compelling case that innovation doesn't have to come at a high price or involve groundbreaking tech. Instead, businesses can differentiate themselves from the competition by innovating smarter, not harder. It’s an eye-opener for anyone caught up in the idea that "new" must always mean "expensive."

A key chapter highlights the “Pareto Principle of Innovation,” suggesting that 20% of a product’s features can address 80% of customer needs. The authors provide case studies showing how Planet Fitness and Dollar Shave Club succeeded by offering only what matters to their target markets. These companies knew customers weren’t paying for luxury; they were paying for value. By following this approach, businesses can direct resources more effectively and reduce costs, which is particularly useful for smaller companies with limited budgets.

Another powerful piece of advice is on customer segmentation. Wunker and Luo Law emphasize that effective costovation requires understanding what different customer segments value. For instance, Southwest Airlines cut unnecessary frills, instead focusing on friendly service and reliable, budget-friendly flights. The message is clear: By understanding what each customer segment does and doesn’t value, companies can deliver satisfactory targeted solutions without straining their budgets.

Each chapter is practical, engaging, and provides real-world examples. Wunker and Luo Law avoid abstract theories and instead offer actionable strategies. They break down the steps of costovation, from ideation to implementation, making it easy for leaders to visualize how to incorporate this innovation into their businesses. This book is ideal for managers looking for insights without having to wade through excessive jargon or complex concepts.

Costovation differs from typical innovation guides because it focuses on being customer-centric over technological marvels or elaborate new processes. Wunker and Luo Law bring innovation back to its core purpose—serving customers better—while reminding us that innovation without frugality can lead to bloated offerings and unsatisfied customers. This advice can benefit any company, whether a high-tech startup or a family-owned service business.

Costovation is an essential read for anyone serious about improving value while controlling costs. The authors show how innovative thinking can be applied to minimize costs without sacrificing customer satisfaction in a way that’s both inspiring and achievable. For business leaders seeking a new, grounded approach to innovation, this book is a must-have.

Dan Beaulieu is president of D.B. Management Group.

Title: Costovation: Innovation That Gives Your Customers Exactly What They Want—And Nothing More
Authors: Stephen Wunker and Jennifer Luo Law
Copyright: 2018 Amacom
Pages: 208
Price: $2.49 (Amazon)