1539 Copyright © 2015, IGI Global. Copying or distributing in print or electronic forms without written permission of IGI Global is prohibited. Chapter 80 DOI: 10.4018/978-1-4666-6268-1.ch080 Identifying Different Forms of Innovation in Retail Banking ABSTRACT To be competitive and capture new customers, banks must develop continuous innovations that can reduce costs, enhance existing service quality, expand current service offerings, and increase market share. This article proposes a typology of different types of innovation in the retail banking sector on the basis of a case study of the leading French credit institution, Crédit Agricole. This bank does not inno- vate just incrementally, and radical innovations resulted from the launch of a new distribution channel, though several innovations are unrelated to new technology. This study adds to literature on innovation services by enhancing understanding of the different types of innovation. The empirical investigation further shows that the banking sector can develop process innovations, which give the bank a longer term competitive advantage. To innovate radically, the bank should anticipate the impact of its new of- ferings on different areas of the system. 1. INTRODUCTION Despite growing service-related and innovation management research, researchers continue to call for further studies that can improve understanding of service innovation (Ordanini & Parasuraman, 2010). The service sector remains the “poor rela- tive” in innovation management literature (Gallouj 2002), which concentrates instead on technical innovations (Damanpour, Walker & Avellaneda, 2009), especially in biotechnology, semiconduc- tor, and other such industries (Baum, Calabrese & Silverman, 2000; Gilsing & Nooteboom, 2005; Roijakkers, Hagedoorn & Van Kranenburg, 2005). Yet such results rarely apply effectively to the ser- vice sector (Sundbo, 1997), because of its lack of standardization, as well as the relatively minimal investments in R&D for services, leading to an Véronique Favre-Bonte Laboratory Institut de REcherche en Economie et en GEstion (IREGE), University of Savoie, France Gardet Elodie Laboratory Institut de REcherche en Economie et en GEstion (IREGE), University of Savoie, France Catherine Thevenard-Puthod Laboratory Institut de REcherche en Economie et en GEstion (IREGE), University of Savoie, France