The work aims to explore the ways that competitors in the increasingly fierce market for cultural and creative products adopt innovative approaches to survive in the new era of cultural creativity. By integrating perspectives from marketing theories with those from the cultural and creative industries and design studies, a comprehensive strategy for product innovation from the standpoint of market competition was presented. Given the complex, volatile, and long-cycle nature of competition in the cultural and creative theories, the essence of industry competition was discussed and the foundations of product innovation were analyzed from multiple angles, including corporate competition, cultural construction, and consumer value. Interdisciplinary breakthroughs, IP development, and new technology-driven formats were identified as pivotal points for market innovation in the new cultural and creative context. Four innovative approaches to competition in the cultural and creative market, namely, enhanced user experience, differentiation, virtuality, and brand power, were proposed. Through qualitative analysis, the underlying principles and the innovative thinking were elucidated. Particularly with respect to the contemporary development of the cultural and creative sector, a systemic framework that integrates digital scenarios and marketing concepts was proposed. This provides enterprises, brands, designers, and other market players in the cultural and creative industry with a more competitive innovation model.