The world is changing rapidly, and once-loved “legacy” brands are falling out of favor. The reason is painfully simple. At one time these brands exceeded customers’ needs and stood for something they cared about. (That’s how you earn love.) But today’s customers are different. Very different. The vast majority are living a lifestyle that has digital at the center…and many companies haven’t transformed to meet them there.
“Digital is no longer just a ‘need’ for customers,” says Howard Tiersky, author of the new book Winning Digital Customers: The Antidote to Irrelevance and “one of the top 10 digital information influencers” according to IDG. “Expecting to access a seamless digital experience on demand is more like a value. If you can’t provide that, you’re not only not resonating with their lifestyle, you’re in conflict with their fundamental worldview.”The move toward total digital immersion has been happening for a while, notes Tiersky; COVID has only accelerated it. And here’s the thing: Almost all businesses have digital operations, so you may think yours is meeting customer expectations. But there’s a good chance it’s falling short.
Winning Digital Customers is Tiersky’s formula to help you prevent that scenario. It’s a how-to guide and step-by-step blueprint for companies struggling to digitally transform. The book lays out a simple but detailed methodology that any company can follow to align their teams around a vision for customer experience that will maximize competitiveness, identify quick wins that will help them out of the gate, and ultimately drive the transformation needed to bring their company into alignment with today’s digital world.
Let’s say your organization is already using digital for marketing and e-commerce, but you are not truly “digitally driven.” Maybe you provide customers with a good app—but it’s really just an add-on. You’re not aggressively creating products and experiences that take full advantage of the potential of digital. You can’t honestly say you’re digital at the core. If this describes you, is it truly necessary to change? Most likely yes, says Tiersky. Here are just a few reasons why...
REASON 1: You Need to Remain Relevant to the Customer. Customers today demand a superior digital experience. A Salesforce study found that 80 percent of customers view “the experience” a company provides as equally important as its products and services. But across industries, most experiences offered today are simply not up to customers’ expectations. PwC found that 49 percent of U.S. consumers say that companies are providing a “good” customer experience today. Brands also spent a lot of energy on online content about their brand and products. But market research shows that consumers today have massive cynicism today about what brands “say” about themselves. As Trinity Mirror and Ipsos Connect found in a study, almost half of consumers have a general distrust of brand and 69 percent specifically distrust their advertising.
REASON 2: You Need to Gain the Efficiencies to Be Cost-Competitive. Companies that are winning in the digital economy are delivering a dramatically improved value proposition—offering customers more for less. It helps to have investors who are patient about whether the company operates at a profit. But more long-term, these companies are able to operate in a different way—harnessing tools like crowdsourcing, AI, and process automation.
REASON 3: You Need to Attract and Retain Talent in the Organization. Millennials want to be a part of companies that are digitally savvy. This might be the most important reason of all to ensure that your company has a high level of digital effectiveness. A study by the market research firm Penn, Schoen, & Berland found that 82 percent of millennials can be swayed in their career decisions by a digitally equipped office, while 42 percent would leave a company due to “substandard technology.” Similarly, Microsoft found in a study that 93 percent of millennials polled cited modern and up-to-date technology as one of the most important aspects of a workplace.
REASON 4: Digitally Driven Companies Have Greater Revenue Growth. A study by the Aberdeen Group found that the top 20 percent of companies as measured by their “quality of digital customer experience” enjoyed an average year-over-year increase in revenue of over 35 percent, compared to a 7.7 percent average for the rest. “Digitally advanced” companies create 9 percent more revenue than their industry competitors, as reported in a study conducted by MIT. And digitally “mature” companies are almost three times likelier than lower-maturity organizations to report annual revenue growth significantly greater than their industry average, according to yet another study, this one by Deloitte.
REASON 5: Digitally Driven Companies Have Better Profit Margins. Despite the investments they need to make to transform, studies show that digitally driven companies deliver better returns. A Harvard Business School study found that the three-year average profit for “digitally centric companies” was 5 percent more than that of those companies “behind the curve.” A different study at MIT concluded that “digitally mature companies” are 26 percent more profitable than competitors. What’s more, digitally effective companies tend to be highly customer-centric. A KPMG study showed that “customer-centric” companies saw a projected profit growth rate that was 3.6 percent greater than “non-customer-centric” companies.
REASON 6: Digitally Driven Companies Have Higher Valuations. Lastly, and perhaps most importantly, digitally driven companies have consistently higher valuations. According to MIT, more digitally “mature” companies achieve market valuations 12 percent higher than competitors. Forrester calculated that in recent years, the stock price of “leaders in digital customer experience” grew by nearly 30 percent more than that of lagging brands. Bottom line? It’s a new era. There have been many periods of time when businesses could operate in more or less the same manner for decades, updating their advertising campaign periodically, creating marginally “new and improved” products every few years, and making small incremental changes to keep cutting costs and drive profits higher. Those days are gone. You need to reinvent yourself, and there’s no time to waste.
About the Author:
Howard Tiersky is the author of Winning Digital Customers: The Antidote to Irrelevance. He has been named by IDG as one of the “Top 10 Digital Transformation Influencers to Follow Today.”