It's Not Too Late For Digital Transformation
Michael Gale recently announced that digital transformation is dead in an article in Forbes. The core of his argument revolves around the idea that it’s too late for your business if you’re not already thinking digital-first.
He’s a very smart guy, and he makes some great points: companies who are behind the curve are operating at a significant disadvantage in a digital world. But is it really too late?
As Wpromote’s Founder and CEO, I have the chance to see a lot of different businesses come through our (virtual) doors at every stage of maturity when it comes to digital, from high-growth online powerhouses to legacy brands still struggling to transition to the pace of digital change at a fundamental level.
The truth is, no matter how behind you are, your brand is already part of the digital world because your customers are.
They’re already researching options, looking up your brand and your products at the search bar, or checking social media to see if your business is there.
The future of your business depends on embracing a proactive digital approach
There are two primary differences between a business that is passively present online and a digitally transformed business: the first is about control. A digital-first business is owning the narrative around their brand, selling products, providing opportunities to educate or engage through content, and building a relationship with customers directly across channels.
The second is about the ability to seize opportunities proactively in the digital world. Leveraging data and harnessing the power of the internet to serve your business objectives is necessary to unlocking competitive advantages and capturing more market share.
What’s most exciting about all things digital is the capacity for change.
You can move fast and quickly test and deploy new strategies and tactics to achieve your goals. And that means, unless you’re determined to refuse to embrace change and become the next Xerox or Kodak cautionary corporate tale, you still have a chance to catch up.
The businesses that haven’t yet embraced digital often come to us with a sense of urgency, but we can tell very quickly whether or not they’re really ready to embrace digital transformation. The ones that are likely to succeed are hungry to take the next step and willing to question foundational assumptions about marketing that may be holding them back.
You need buy-in from your entire organization to achieve digital transformation
Digital transformation is not as simple as activating a channel or deciding to build an ecommerce website. It means examining the way that your customers are spending their time, researching, transacting, and making decisions. It’s understanding how they’re deciding what to eat for dinner and where to stay and what to do. It means asking some fundamental questions and challenging the status quo.
It’s not enough to just hire people who understand digital. That might be necessary, but it’s not enough.
Your entire organization needs to speak the language, reorient their priorities, and be prepared to leverage the unique insights driven by digital transformation.
That process involves learning and development, education, and re-training across the organization. Those skills will elevate your organization as a whole and become the core elements of your future planning.
Part of our mission when partnering with a client is embedding our people onto their teams, so our experts become an extension of the client’s organization. That also means they can help evangelize and educate the org on how to put digital at the center of the business the right way—so it will make the biggest possible impact on growth.
One major roadblock I’ve seen again and again is the way many digitally curious businesses approach media strategy, budgeting, and measurement. You can’t expect to do things the way they’ve always been done and get different results. That’s the marketing version of the definition of insanity.
The key is building a strong bridge between the CFO and the CMO. Together they are responsible for putting together and executing on a shared vision that is focused on growth, not just accountability.
To succeed in digital channels, marketers need to unlock sufficient spend and budget flexibility to capitalize on opportunities. That can’t happen if the CMO and CFO aren’t completely aligned.
If the CFO is fluent in the ways digital effectively drives profitable growth and the CMO has a deep understanding of the level of accountability and expectations for results that finance requires, your business will be well-positioned to jumpstart digital transformation, regardless of where you are right now.
Part of what we’ve focused on internally is giving our teams the right tools to build the business case that bridges that gap with finance teams, so they can make sure our clients are as successful as possible. In my mind, that might be the single biggest factor to drive transformative digital success for an organization.
You need to build a digital transformation roadmap
The good news is you’re not starting from scratch. Start by identifying your existing advantages. If you’re a legacy brand, you may have a loyal customer base, a massive database of customer emails, and wide brand recognition. If you started with a brick-and-mortar focus, you may have a wealth of location-specific insights, roots in the community, and a strong reputation for great customer service.
Consider how your existing strengths can be translated and applied to your digital approach because they have the potential to provide a powerful boost against online competition.
Plenty of legacy organizations have come from behind to reposition themselves as digital leaders; Walmart is a great example. They were slow to embrace digital capabilities and lost significant market share to digital natives like Amazon. But they are quickly gaining ground on the ecommerce giant by leveraging and augmenting existing strengths (scale, distribution, reach, brand recognition) in new ways by embracing technology and a digital-first future.
In 2021, Amazon grew its business by 15%, while Walmart expanded by 21%. Amazon is still in the top spot, but Wal-Mart is moving fast to close that gap and take advantage of growth opportunities in the digital space.
Businesses often come to us unsure of how to even get started, especially if they already feel like they’re behind. So we built The Challenger Framework to provide a roadmap that can help brands take the right steps to ensure a successful digital transformation.
Essentially, there are four basic ingredients in the digital transformation recipe:
- Objective: Set a core business objective you can align all of your efforts against so everyone is working toward the same goal.
- Learnings: Don’t repeat the past, but make sure you’re getting all of the value possible out of what you’ve already done: what worked and what didn’t, where there is low-hanging fruit, and what will take longer to achieve.
- Strategy: Bridge the gap between your future objective and your past learnings with a multi-channel marketing strategy aligned with your business goals that takes advantage of digital capabilities, innovations, and opportunities.
- Measurement: Make sure what you’re measuring is aligned with your media principles and direction so that you can translate that data into insights that drive action, so your strategy can get more effective over time.
All of this can seem overwhelming, and I’ve seen too many organizations revert back to what they’re comfortable with or commit to going part of the way to digital transformation, but that’s a mistake. If you have the vision and the will to make the change, you can do it. And every day you wait represents significant missed opportunities.
Where digital transformation plans go wrong
One of the biggest mistakes I see all the time is the continued siloing of the different parts of the marketing org, which only invites chaos and serves as a significant barrier to achieving your vision for a successful digital transformation. That might mean internal silos, or a whole coalition of different agencies running social, search, TV, etc.
I get it; when I first started Wpromote, we had a very narrow focus and expanded into new services as clients looked to find better alignment across channels. We saw firsthand that the clients who were taking a performance mindset to a fully integrated marketing strategy that encompasses the entire funnel and every channel were driving the best results. And we realized that was the path to true transformation and profitable growth.
Digital transformation plans are not one-size-fits-all. You can’t copy and paste a marketing plan and then modify it so that it fits for digital, or only look at channels in a vacuum, independent from your other marketing initiatives. You need to take a holistic approach to a digital transformation plan that is custom-built around your business objectives and takes all of your marketing into consideration so it works together.
Another common mistake is focusing too much on a single purchase, especially when you’re seeing immediate results from digital direct response channels. Yes, new customer acquisition is extremely important (and often the initial focus of performance marketers). But that needs to be balanced with marketing’s other purpose: to energize, motivate, and incentivize customers to come back and buy again.
Digital transformation is not just about driving one-time purchases, it should be built to turn one-time purchasers into repeat buyers, then take those loyal customers and transform them into brand evangelists.
Digital gives you the ability to segment your audiences so you can serve the right messages to people in different parts of that lifecycle, from people who are just learning about your brand to people that buy frequently, those who have engaged without buying to those who have bought something once, all the way to your most important customers with the highest lifetime value.
Taking a holistic approach that can capitalize on short-term opportunities while driving long-term sustainable growth is essential.
It’s not too late to get on track
One of the most challenging things about the digital world is the constant, relentless pace of change. But that’s also my favorite thing about it. So much has already happened, and you are constantly presented with new variables, new opportunities, new possibilities, and that can feel both exciting and overwhelming.
But all of that change actually means that it’s never too late. The brands at the front of the pack right now could be behind tomorrow. If you take the right approach and get your entire organization on board, align on business priorities and bring a holistic mindset, and prepare to embrace innovation, you will be able to make the leap to a true digital transformation.
When I talk to CMOs, there can be intense pressure to maintain the status quo instead of embracing change that comes with a degree of risk. We build our client partnerships to make sure that those leaders are empowered to create and execute their vision while setting the business up for long-term success.
Profitable growth is directly tied to digital transformation right now. The power to make it happen is yours.
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