In 1836, Rowland Hill innovated the delivery of letters in Great Britain.

You might wonder how.

Hill upended the concept of how to pay for postage. At the time, mail was paid for by the recipient. The cost was determined by using distance and weight.

Instead, Hill proposed that postage should be uniform in the country regardless of the distance. Postage should be pre-paid using stamps that can be affixed to the envelope. Stamps of a similar variety were already commonplace to pay other fees and taxes.

And just like that, mailing a letter became cheap and the number of letters sent skyrocketed.

Instances of innovation like this are remarkable because of the simplicity. Also, they are created within the boundaries of an existing framework.

There are other examples to consider:

• In the NFL, the Detroit Lions didn’t invent the idea of “going for it” on 4th down. They just happen to “go for it” more often that most. In doing so, they have transformed how the team plays the game and put a must-see product on the field.
• Liquid Death. Water in a tall boy, beer can and the brand is worth $1.2 billion. The innovation truly lies in the marketing and it flies (rather aggressively) in the face of the likes of Fiji and Aquafina….it’s like the Red Bull of water.

In the case of Liquid Death, the criticism is often “It’s just water!”

In the case of the Lions, it’s “They’re too aggressive!”

In the case of Hill and uniform postage, the elites who already had the benefit of free postage found the idea abhorrent.

What’s abhorrent is an abundance of hubris.

This leads to a lack of unique ideas, and subsequently, meaningful progress.

Such innovations might be seen as rather boring compared to their high-tech counterparts. However, they create significant impact.

And, it’s like the opportunities hide in plain slight.

The economist David Ricardo once said that “Profits are not made by differential cleverness, but by differential stupidity.” Many interpret this as saying that most companies don’t spend enough time thinking and as such they miss the “obvious” opportunities.

I would argue something different — that cleverness gets us into trouble more often than we would like to admit.

For instance:

• Nike spent six years developing a new fabric which was then used for Major League Baseball’s new uniforms last season. The players hated the uniforms and the league eventually said that this was a case of “Nike innovating something that didn’t need innovating.”
• Starbucks has enabled us to customize drinks in 170,000 ways. However, you’ll wait endlessly for the clever creation.
• Boeing decided that outsourcing was the path towards driving efficiency. Instead, it drove them to disaster because they took the idea way too far.

Go figure, all three companies have recently replaced their CEO’s.

No doubt, all of the ex-CEO’s are smart.

But, they were probably too clever for their own good.

Coming into 2025, the fears of what tariffs will do has both retailers and consumers worried. In both cases, there is much stockpiling activity in advance of the forewarned price increases associated with tariffs.

But, there is a tremendous amount of resilience from the consumer. Spending will happen provided that a retailer offers something compelling in market.

Compelling doesn’t have to mean new products every time.

Compelling could be rapid delivery, free returns, quick replenishment of stock, inventory in the right places and so on.

Compelling can also mean finding ways to cut costs so that the consumer can be somewhat insulated from price increases. Innovating how products are brought to market is one way to get this done.

These are simple ways to innovate and improve performance within one’s existing framework.

And, winning companies will always find a way to be compelling. While losing companies will struggle to execute on the basics.

I, for one, look forward to seeing how the winners win in 2025.

Now if you’ll excuse me, I need to run to the post office to mail a birthday card. Later, I’ll crack open a cold Liquid Death while watching Lions vs. Vikings.