Today ‘digital’ is the talk of a town. We hear about digital technologies, digital data, digital media, digital transformation, digital marketing. Everyone wants to go digital. But which way to go? And why it’s important to have a digital transformation strategy ?
We know now that mobile is the future of everything. With the rise of the Internet of Things and mobile devices our lives and habits have clearly changed. Everything is now connected and if it’s not, it’s about to. We live in a world where you can connect your coffee machine to the Internet and make your coffee via Bluetooth. If your coffee machine can go online and you’re still only thinking about it, what does it say about you?
Go ‘digital’ or go home. What is digital transformation?
So, you’ve decided ‘to put yourself out there’? But before you move with your digital strategy, it’s important to understand what it really means and thus how to be able to benefit from it.
Digital transformation is often viewed as an implementation of digital technologies into all areas of business in order to build more sustainable relationships and better understand the needs of customers.
But this is just one of the ways to look at it. When talking about digital, we can think of discovering new frontiers and using innovation and technologies to push your business. It’s about finding new possibilities of an existing service in order to design and deliver a better experience for your customer. Some might argue it’s a new way of interacting with customers. None of these definitions is truer that the other but what we can all agree on is that today.
Now that we’ve established the significance of digital transformation, let’s dwell on how crucial it is to plan and strategize.
On the importance of digital transformation strategy
Strategy is more important than technology – states MITSloan report. And they’ve got some facts to back their opinion.
Simply going digital isn’t going to cut any more. Only 15% respondents from companies that are at the early stages of going digital say that their company has got a clear digital transformation strategy. While for a digitally mature companies, where digital first has helped transform business models and processes, as well as increase talent engagement, the number is more than 80%.
It seems like being a digital company is a key factor in many respects today. Potential employees name being digitally enabled company as one of the reasons to seek employment within the organization.
For companies, a digital business strategy is viewed as means of transforming their business, streamline processes, and making use of technologies to enhance their interaction with customers and employees, and deliver excellent customer experience at the same time. Failing to plan in that field comes with a great price. One of the biggest obstacles to becoming digitally mature company is lack of digital transformation strategy. 50% of survey participants named it the main barrier to digital maturity.
And what is the state of digital, you might ask? In a race between enterprises and startups, the later seems to be leading. 55% of startups have already adopted digital transformation strategy, by contrast, only 38% of traditional enterprises did. But this doesn’t mean that the race is over. Among the established organizations, the wind of change is blowing heavy with 89% of companies either already adopting or planning to adopt a digital-first business strategy, with Services (95%), Financial Services (93%), and Healthcare (92%) at the forefront.
Tecchnologywise, Artificial Intelligence, Machine Learning, and the Internet of Things are three top technologies enterprises are after.
At this point, you might wonder why to go all the trouble. Sit back as we tell you the stories why digital transformation is important.
A Lesson in digital. How one company ‘killed’ retail.
But this is a theory, in practice the best way to draw your digital inspiration is to learn from the masters like Amazon, one digital company that conquered the retail world.
Ten years ago nothing suggested a threat to brick and mortar stores. Their future seemed bright and promising. Back in 2005 Amazon was just an online bookstore with modest sales numbers. Today it is worth more than all major brick and mortar stores in the United States combined.
While all of the listed retail stores witnessed a loss in value, going as dramatic as -86-96 %, the business for Amazon was only blooming. It has gained 1,934 % in value and went straight to one of the most valuable companies in the world.
So it’s either nothing predicted a storm or brick and mortar stores failed to notice all the warning signs on their way.
But not all stories are of success. There are some that serve like cautionary tales. Take Kodak, a company that squandered every digital opportunity it had. And plenty it had. It was a Kodak’s engineer who invented a digital camera back in 1975. And their initial reaction was that it would be a threat to their main business – film. Instead of seeing the bigger picture, that they are in the storytelling business, Kodak thought they would be able to conquer the new technology with a good marketing strategy. The problem with Kodak was not that they failed to go digital, their problem was in not being able to adapt to the digital age and the new needs of their customers.
Ok, you still think your business is too conservative and doesn’t need digital transformation? Here’s an example from another old-fashioned industry that has gone online recently – a tattoo one. Inkbay is a Swedish startup that was launched in 2016 to help people find and book a tattoo parlour online. Many may argue that tattooing belongs offline, that one of the reasons why it’s become so popular is that it’s something you can’t get on the Internet. But the numbers say the contrary. Inkbay initially linked studios in Stockholm, Malmo and Gothenburg and now holds 60 studios on its platform, only to expand to London this summer and Berlin and a 1-billion $ U.S. market soon to follow.
It may seem that your business is doing just fine offline today. Either because your industry is quite conservative or because you’ve been using other means to get the word out there. But what about tomorrow? In the quickly changing world will it be enough what you are doing today? The lesson we can learn from the Titans of business is quite simple – in the today’s world of digital transformation, be an ‘Amazon’ not a ‘Kodak’. Learn to think ahead of your customers’ needs rather that fail to adapt to the needs of the market. Find a way to deliver today what your customer might need tomorrow.
What to remember before you move with your digital transformation strategy
- Think fast in terms of innovationChange is the only thing we can be sure of. Strive for innovation and greatness now in order to stay competitive.
- Embrace the Internet of ThingsThe Internet of Things has arrived and it is a key to creating your innovative experience. Everyday objects are now connected to the Internet, like a fridge that determines when you’re low on food and orders it for you. This creates a lot of new opportunities for marketers. Businesses and customers will only continue to benefit from it.
- Go with the trendsWhen it comes to marketing, the party is happening in the digital world also. Traditional media is slowly dying while digital media is projected to become the number one channel for ad revenue by 2019.
- Don’t underestimate big dataThere’s myriad of valuable data out there but not everyone knows how to use it fully. Analytics helps us understand how customers behave, what they really think about the brand and how your business is seen by the market.
- Adapt to the new needs of customersThe one lesson we can definitely learn from Kodak is that if you ignore your customers, soon they will ignore you. It’s not enough to have a great product, you have to see a bigger picture. Kodak was not in the film business, their business was of storytelling and they ignored that.
- Think outside the boxLike Inkbay did. Be a frontrunner in your field, create value where everyone else thinks it’s impossible.
The main takeaway of going digital is, if you’re not online, it’s like you don’t exist. But what goes into the process is careful planning and strategizing. Both your customers, current or potential employees are interested in the best possible experiences and opportunities. And businesses have no other choice but be on the lookout and continuously improve to engage and retain them.
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