Free Prize Inside

Free Prize Inside Plot Summary

Introduction

Innovation isn't just for geniuses in white lab coats or executives in corner offices. It's a force waiting to be unleashed within every organization, team, and individual. But here's the challenge: traditional approaches to innovation are broken. Companies spend millions on research and development or advertising campaigns, only to see minimal returns. Meanwhile, the most transformative ideas often come from unexpected places - from the edges rather than the center. The path to remarkable products and services doesn't require massive budgets or technological breakthroughs. Instead, it demands what I call "soft innovation" - the clever, insightful additions that transform ordinary offerings into something worth talking about. These innovations become the "free prize" that customers truly desire, even when they don't know it yet. By mastering the art of finding these prizes and championing them through your organization, you'll discover not just business success, but personal fulfillment in creating something that genuinely matters.

Chapter 1: Identify the Sweet Spot of Soft Innovation

Soft innovation represents the perfect middle ground between big advertising campaigns and complex technological breakthroughs. It's the sweet spot where modest investments yield extraordinary returns. Unlike traditional R&D which requires massive budgets and specialized expertise, soft innovation can come from anyone in your organization who has insight and creativity. It's about making small but significant tweaks that transform ordinary products into something remarkable. Consider Rita's candy shop on Highway 11 in Canada. While surrounded by gas stations, fireworks stores, and countless other unremarkable businesses on a busy highway to cottage country, Rita's shop stands out dramatically. She doesn't sell ordinary candy - she sells candy you can't find anywhere else in the country. She sells individually wrapped bags of penny candy so parents don't worry about grimy hands touching the merchandise. She stocks flavors and brands from childhood that customers thought were gone forever. She even sells "spotted dick," the infamous British pudding in a can. The average customer spends $30 to $100 on candy - an extraordinary amount for such a simple product. What makes Rita's store remarkable isn't technological innovation or massive advertising. It's her insight into what would delight customers and make them talk. She identified the free prize - nostalgia, novelty, and quality presentation - that transformed a commodity business into something remarkable. Anyone could have started this business, but Rita was the one who saw the opportunity and acted on it. When you start looking for soft innovations, you'll find opportunities everywhere. QBNet created fast barbershops in Japan, cutting service time from an hour to ten minutes and price from $50 to $8. The 52 Deck Series transformed gift books into beautifully illustrated card decks with ideas for rainy days or visiting New York City. Peace Frogs sells clothing out of refurbished VW vans parked in high-traffic locations like shopping malls. The process for finding these innovations is surprisingly straightforward. Look for edges - attributes you can push to extremes. Make your product faster or slower, bigger or smaller, more convenient or deliberately less convenient. Add sensuality or make it ascetic. Connect customers with each other or create events they'll want to attend. The key is to go all the way to the edge, not just part way. Halfway innovations cost almost as much but generate far less excitement. Remember that innovation isn't just about making money. When teams create something amazing, useful, helpful, or remarkable, we reach our full potential as humans. The opportunity to create something that matters provides the engagement that makes work worthwhile. Soft innovation isn't just profitable - it's personally fulfilling.

Chapter 2: Champion Your Ideas Through Organizational Barriers

Even the most brilliant ideas die without a champion to guide them through organizational barriers. Organizations are naturally resistant to change, especially those experiencing success. They're focused on keeping current customers happy rather than finding new ones or pushing boundaries. This resistance isn't rational - it's emotional and institutional. Understanding this reality is the first step toward overcoming it. Joe Perrone at FedEx faced this challenge when he had a simple but powerful idea: cutting slots in the sides of FedEx trucks so customers could deposit packages even when drivers weren't available. Rather than demanding approval from the top, Joe methodically built support by approaching different departments with specific questions. He didn't ask, "Do you want to do this?" Instead, he asked, "If we can solve this problem, are you willing to try this?" He approached corporate identity to ensure the slots wouldn't damage the brand. He consulted legal about custody issues for unchecked packages. He worked with engineering to create weatherproof, secure slots. As each department bought in, Joe made sure other departments knew about the progress. By demonstrating that others supported the idea, he created momentum. He also pushed ahead on his own, getting a prototype built quickly to make the concept more concrete and establish that this innovation was happening - the only question was whether people would contribute their input early or miss their chance. The key to Joe's success was understanding the fulcrum of innovation - the three questions people unconsciously ask when evaluating any new idea: Is it going to be successful? Is it worth doing? Is this person able to champion the project? By addressing these questions systematically, you can leverage even modest organizational authority into significant innovation. To build your reputation as a champion, start small. Champion lunch. Champion customer service issues. As each project succeeds, people will increasingly see you as someone who can make things happen. When presenting ideas, denigrate the status quo before offering your solution. Make people understand that current approaches are failing before introducing your alternative. Use skeumorphs - familiar elements that make new ideas feel safer - to help people believe your innovation will succeed. Creating prototypes dramatically increases your chances of success. Seeing and touching something concrete makes abstract ideas real. When Paul Sagel pitched Crest Whitestrips to senior management at Procter & Gamble, he brought parts and assembled the prototype right in the meeting room. Even more impressively, he had his teeth whitened days before - he himself became a walking prototype with gleaming white teeth. Remember that championing ideas isn't about being perfect or having all the answers. It's about asking questions, creating allies, and taking responsibility. When you look someone in the eye and say, "I'm going to make this happen unless you insist that I stop," more often than not, you'll get what you ask for. The process may feel difficult, but the rewards - both organizational and personal - make it worthwhile.

Chapter 3: Master the Fulcrum of Innovation

The fulcrum of innovation represents the leverage point that transforms ideas into reality within organizations. Understanding this concept is crucial because no matter how brilliant your idea might be, without proper leverage, it remains just that - an idea on paper. The fulcrum consists of three critical questions that determine whether your innovation will move forward: Is it going to be successful? Is it worth doing? And are you the right person to champion it? Seth Godin learned this lesson the hard way at Yahoo! He developed a brilliant concept that would have given Yahoo! users "frequent-surfer points" for clicking where the company wanted them to. This attention currency could have been traded Web-wide, with other sites buying points from Yahoo! and users redeeming them through monthly auctions. It was potentially a $100-million-a-year business that would have ensured Yahoo!'s long-term dominance. Yet despite the idea's merit, it went nowhere. Why? Because Seth failed to build the proper fulcrum. His new boss didn't know or trust him enough to believe he was the right champion. No one else volunteered to take ownership of the project. And Seth didn't adequately challenge the status quo to demonstrate why this innovation was worth pursuing. The idea withered and died despite its potential. Had Seth first championed smaller projects to establish credibility, built relationships within the organization, and clearly articulated the risks of inaction, the outcome might have been different. For any innovation to succeed, you must understand who the real decision-makers are in your organization. Often it's not the people with the most impressive titles. At one major company, four senior managers acted as gatekeepers, blocking innovative ideas before they could reach top executives who actually wanted bold initiatives. Champions who succeeded learned to approach these managers differently - not by emphasizing exciting change but by focusing on how innovations would bring more stability and reduce risk compared to the status quo. Building your fulcrum requires different tactics for different situations. Sometimes asking questions works better than providing answers. Dr. Peter Pronovost revolutionized intensive care by developing a simple checklist that has cut average ICU stays in half. When faced with resistance from doctors who feared losing autonomy, he didn't argue but instead asked, "Is it acceptable to harm patients?" By framing the issue this way, he made it easier for them to accept his innovation. Other effective tactics include selling to individuals rather than groups, building prototypes that make abstract ideas concrete, creating a shared vocabulary for your innovation, and using visual aids effectively. In presentations, remember that communication is the transfer of emotion, not just information. Use images that trigger emotional responses rather than text-heavy slides that simply repeat what you're saying. The most important insight about the fulcrum is that innovation isn't a one-time event but an ongoing process. By consistently developing your reputation as someone who can champion ideas successfully, you'll find each subsequent innovation becomes easier to implement. This creates a virtuous cycle where your personal credibility and the organization's innovation capacity grow together.

Chapter 4: Go to the Edge: Create What's Truly Remarkable

Creating something truly remarkable requires pushing to the edges rather than lingering in the comfortable middle. When products stay in the center - slightly better, slightly different, slightly improved - they become invisible. The magic happens when you take an attribute and push it all the way to its extreme. Half measures don't work because they're neither familiar enough to feel safe nor different enough to be remarkable. Windham ski area provides a perfect example of this principle in action. Located near the more famous Hunter Mountain a few hours from Manhattan, Windham was stuck competing as just another "nice little ski area." Their initial focus was on incremental improvements - better lifts, better snow, better equipment. But this approach couldn't overcome a fundamental problem: Vermont and Utah offered genuinely superior skiing experiences for just a little more money. Windham would never be remarkable for people who primarily cared about skiing quality. The breakthrough came when Windham realized people choose ski areas for many reasons beyond skiing itself. They began exploring edges they could own completely - building the world's best beginner's ski school (perhaps with indoor treadmill-style devices), creating the East Coast's finest Mexican restaurant and chili, or offering the most convenient valet service imaginable. Rather than trying to be slightly better at everything, they focused on being dramatically better at specific attributes that would make people talk. This approach works across industries. Hallmark created a billion-dollar business by helping people express sentiments they couldn't articulate themselves. Trader Joe's sells over $2 billion of food annually by commissioning high-quality private label goods rather than stocking the same brands as other stores. Netflix transformed video rental by eliminating late fees entirely. Hi-Fi bar in Manhattan's East Village stays packed because their jukebox contains 26,000 songs - so many that customers wait three hours for their selections while buying drinks. The edgecraft process for finding these opportunities is systematic rather than mystical. First, identify products or services completely unrelated to your industry that are winning through remarkable attributes. Determine which edge they went to - extraordinary variety, unmatched convenience, surprising visibility, or perhaps deliberate inconvenience. Then apply that same edge to your own industry in a fresh way. Master Lock demonstrated this perfectly when they redesigned their padlocks. They didn't make the locks more secure (the obvious approach), but instead focused on usability. They clearly labeled each lock for its intended function (bike locks near bikes, locker locks near school supplies). They placed keyholes on the front instead of the bottom. They added colored rubber bumpers that prevented scratching and matched the colors of the keys. None of these changes made the locks safer, but they made them significantly more functional and recognizable. The result? Sales improved by 50 percent. Remember that remarkable doesn't mean "best" in the traditional sense. It means "worth making a remark about." The world's fastest car, the world's slowest service, the world's most convenient location - these extremes create conversation. Average products for average people create nothing but silence. Your job is to find the edge that matters to your specific audience and go all the way there.

Chapter 5: Turn Your Product into the Marketing

The most powerful marketing isn't found in advertising campaigns but within the product itself. When you create something worth talking about, customers spread the word for you. This shift represents a fundamental change in how growth happens - from interrupting people with messages about your product to making the product itself remarkable enough to generate conversation. Jeff Bezos at Amazon demonstrated this principle perfectly when he announced they would stop advertising altogether. Instead of spending money on TV and magazine ads, Amazon redirected those funds into free shipping. Industry experts were aghast - how could a retailer abandon traditional marketing? Yet the results were stunning: sales increased 37 percent, international growth hit 81 percent, and Amazon reported its first quarterly non-holiday profit. The product improvement became the marketing. Sam Attenberg applied this thinking to photo booths in Japan. Rather than producing traditional photo strips, he modified the machines to print sixteen tiny photos on stickers. The result? Japanese teenagers went crazy for them, generating hundreds of millions in sales. The brilliance wasn't just the product itself but how it naturally encouraged sharing - the stickers were designed to be placed in friends' autograph books, spreading awareness with every use. The product itself created the marketing network. CD Baby, founded by musician Derek Sivers, demonstrates how this principle works for services. Sivers didn't have venture capital to build a complex proprietary system or run expensive ads. Instead, he taught himself FileMaker and built a simple but effective platform for independent musicians to sell their CDs online. Then he focused on soft innovations that would get people talking - musician-friendly policies, funny confirmation emails, and exceptional customer service. While other dot-coms collapsed, CD Baby thrived because the service itself was the marketing. Building communication directly into your product creates viral growth. Amazon made every customer a potential affiliate who could earn commissions by recommending products. Netflix puts a free trial coupon in every order, encouraging customers to recruit friends. Meetup.com organizes monthly gatherings for millions of people, turning each meetup into a marketing opportunity for the next one. Another powerful approach is making invisible products visible. Dyson vacuum cleaners use clear plastic canisters instead of bags, allowing users to see exactly how much dirt was extracted from their seemingly clean carpets. This visible proof becomes a natural conversation starter. Apple's white iPod headphones transformed a personal listening experience into a public statement. Security guard companies could stand out by creating distinctive uniforms that draw attention in otherwise invisible service. The most remarkable aspect of turning products into marketing is its cost-effectiveness. Master Lock's design improvements cost relatively little compared to traditional advertising yet delivered a 50 percent sales increase. The March of Dimes transformed fundraising by putting community leaders in "jail" and requiring them to call friends for "bail" donations - leveraging existing social networks rather than paying for outreach. These approaches deliver better results at lower costs than traditional marketing. The key insight is that today's consumers have too many choices and too little time. They've learned to ignore traditional advertising but still crave guidance on what products deserve their attention. When you build remarkable features directly into your offerings, customers become your marketing department, spreading the word far more effectively than any advertisement could.

Chapter 6: Build Soft Innovations That Generate Real Value

Soft innovations create genuine value when they address unmet needs or solve problems people didn't realize they had. While traditional innovation focuses on making core products better, soft innovation looks beyond the obvious to find the free prize - that extra element that transforms something ordinary into something remarkable and worth talking about. Tony Cherot and Jane Dirr of Specialty Films & Associates demonstrate this principle perfectly. They started as middlemen between packaged goods companies and factories making commodity packaging products like chip bags and medical pouches. Initially, they tried to succeed through aggressive procurement and smart salesmanship - the traditional approach. But they struggled until they realized something profound: everything they do is marketing, including their choice of product line. Rather than continuing as middlemen, they transformed their business by becoming manufacturers focused exclusively on remarkable products. They bought machines and developed innovative ways to use them that no one else could match. By inventing new packaging solutions like specialized pouches and zipper closures, they created products worth talking about. They combined insanely fast turnaround times with cutting-edge designs, discovering that this approach made traditional marketing unnecessary. The innovative products sold themselves. Dr. Peter Pronovost created one of the most valuable soft innovations in healthcare with a deceptively simple checklist for ICU procedures. He realized that communication failures, not lack of knowledge or equipment, were causing preventable deaths. Doctors knew what to do but frequently missed steps or failed to coordinate properly. His checklist solution has cut average ICU stays in half - saving lives and dramatically reducing costs. What makes this innovation "soft" is that it required insight and creativity rather than new technology or massive investment. The Three Dog Bakery chain built a thriving business by creating all-natural, human-grade treats for dogs. The innovation wasn't primarily for the pets but for their owners. As Ann Willoughby, who helped create the chain, explained: "This store wasn't for the pets, of course. It was for the owners. It's theater." By understanding that pet owners wanted to express love through premium treats, they created an emotional connection that traditional pet food companies missed. Building successful soft innovations requires identifying edges that matter to your audience. For CD Baby, Derek Sivers realized musicians wanted fair treatment and transparency more than fancy technology. He paid artists weekly when competitors paid quarterly or less frequently. He created a system showing exactly how many of each artist's CDs had sold that day. These policies required no technological breakthroughs but generated tremendous loyalty and word-of-mouth. The key to generating real value through soft innovation is recognizing what people actually want versus what they say they want. If people spent more than $10 on a watch, they're not just buying something to tell time - they want beauty, prestige, or identity. L'eggs pantyhose transformed their industry not by making better hosiery but by moving sales from department store counters to supermarket shelves, eliminating awkward conversations about sizes. In-N-Out Burger thrives with just seven menu items while competitors offer dozens of options. Remember that soft innovations don't last forever. Krispy Kreme saw customer counts drop 20% after their initial novelty faded. This underscores the importance of continuously creating new free prizes. By establishing a process for identifying and implementing soft innovations, you create sustainable competitive advantage that technology alone cannot match.

Chapter 7: Design Free Prizes That People Actually Want

Creating free prizes that resonate with customers requires looking beyond what they say they need to discover what they truly want. This distinction is crucial - people rarely make purchasing decisions based solely on functional requirements. Instead, they're drawn to emotional, aesthetic, and experiential elements that provide deeper satisfaction. Consider the remarkable success of Apple's iPod. Users could spend half as much on competing MP3 players with more storage capacity, but they didn't. The iPod's beautiful industrial design and intuitive interface created an emotional connection that transcended technical specifications. People weren't just buying a hard disk in a box - they were buying the feeling of sophistication and simplicity that came with it. The free prize wasn't more storage but a better user experience. Susan Beattie demonstrated this principle when she opened T. Lloyd Clothiers in Portsmouth, New Hampshire. In a challenging economy for upscale retail, she focused not on selling better clothes but on creating a superior shopping experience. Tired of being treated with disdain or indifference at other stores, she built an environment offering respect, caring, connection and community. Not a little - a lot. She went all the way to the edge with customer service. Less than a year later, they were preparing to open a second location. The process of buying clothes had become as important to customers as the clothes themselves. Free prizes succeed when they address overlooked senses or experiences. The Serrano hotel in San Francisco features shower rooms with eight shower heads, built-in stereo systems, and televisions with speakers. While no one chooses a hotel specifically for the shower, this remarkable feature becomes something guests enthusiastically tell others about. The Starwood chain made a simple $15 modification to shower curtain rods, bending them outward to prevent the uncomfortable "sticky shower curtain" experience - a tiny change that significantly improved guest satisfaction. To identify free prizes people actually want, look for edges that confound expectations. What if your bank ATMs occasionally dispensed $100 bills in place of $20s? What if your restaurant was staffed with employees empowered to be politely sassy to demanding guests? José, a server at a Denver airport taco shop, transformed an ordinary fast-food experience by spending extra time chatting with customers, retrieving special condiments, and following up - all at zero cost to his employer but enormous value to customers. The power of sensuality in creating free prizes can't be overstated. Mexico has countless all-inclusive resorts, but only Freedom Paradise caters specifically to overweight people, creating a community where guests feel attractive and accepted. Montana Mills bread built a business around the irresistible smell of freshly baked bread. Sripraphai restaurant in New York created devoted followers through the distinctive taste of authentic Thai watercress salad. These sensory experiences create connections that functional benefits alone cannot match. Timing can also create remarkable experiences. Kang Suh Korean restaurant in New York stays open 24 hours, offering full service at 4 AM when competitors are closed. Conversely, Jim Leff discovered the best barbecue in New York happens just once annually at a church fundraiser - creating enormous demand through scarcity. Halloween superstores appear for just weeks each year, generating excitement through their limited availability. The most important insight for designing free prizes people want is understanding that the obvious edges rarely work. Continental Airlines advertised having "the youngest fleet," but passengers don't notice or care about plane age. They care about comfort, service, and timeliness. By identifying the emotional and experiential elements that truly matter to your specific audience, you can create free prizes that generate genuine excitement and word-of-mouth - the most powerful marketing of all.

Summary

Throughout this journey of innovation transformation, we've discovered that creating remarkable products and services doesn't require massive budgets or technological breakthroughs. The path to growth lies in soft innovations - those clever, insightful additions that transform ordinary offerings into something worth talking about. The key insight is that "marketing is no longer a separate division. It's the whole company." When you build free prizes directly into your products, customers become your marketing department. The most powerful lesson is that anyone can create these innovations. As Seth Godin reminds us, "You don't have to do this yourself. A project worth championing is a project worthy of a team." By mastering the fulcrum of innovation, going to the edges rather than lingering in the comfortable middle, and designing experiences that address what people truly want rather than just what they need, you can transform both your business and your career. Your first step? Choose one edge today, go all the way to it, and start building something remarkable. After all, "you can't afford difficult and risky technological innovation...but you can profit all day long by leveraging insight and creativity to come up with cheap innovations that have a significant return."

About Author

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Seth Godin

Seth W. Godin, also known as "F. X. Nine", is an American author and a former dot com business executive.

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