We’ve all heard the term “digital transformation.” It’s the marketing buzzword for this generation of agencies and marketers. Modern agencies promote its merits, traditional agencies defend the old ways, and clients (in many cases) struggle to understand it.
The first thing we need to understand is what digital transformation is. Digital transformation is a digital- and customer-centric approach to doing business. It’s a path to insights about customers that is data-driven and analytics-based that provides the next step to growing a customer base and reaching people where they engage the most. It’s using technology to rapidly solve your customers’ problems. Read that again: the customers’ problems, not the business’s.
To illustrate this, let’s look at Kentucky Fried Chicken (KFC) as an example. (Yep, the Colonel figured it out.) In my opinion, KFC’s approach to digital transformation was as customer-centric as it gets. Several years ago, the brand was on its way out. It was shuttering stores at an alarming rate, and the business’s stock was on the decline. There wasn’t an issue with the product — fried chicken has become a fast-food favorite. There was an issue with how customers interacted with the brand to get the product. The company as a whole got on board with a plan to implement a click-and-collect platform and a more omnichannel approach to its marketing efforts.
“Click and collect” made it so that modern consumers could quickly place an order and pick it up at a location without effort. The new platform, paired with better kiosks, provided the catalyst for delivering an experience that resonated with a more digital-savvy audience.
In combination with the click-and-collect platform and better kiosks, KFC used the data it had to make better decisions on ad spend: more informed decisions, centering on what worked in the markets it was in, big and small. What did its best customers buy? What did new customers buy? The brand used its own first-party data to create a loyalty program that messages users across channels with a personalized approach.
In addition, KFC implemented geofencing at a longer range to get to consumers when they were hungry. The company reportedly opens a new store every six hours. And soon, it hopes to have more kiosks in place across its footprint than Bank of America has ATMs. Digital transformation works when done right.
So, back to the original reason for this article: The path to digital transformation versus the path that most businesses take (business efficiency). Many enterprises view digital transformation through the lens of their business processes and how they can streamline them through the use of technology, making them more profitable and defining operations for the next, more customer-focused phase.
The flaw in thinking this way is that a business doesn’t need to be more efficient if it doesn’t have the consumers to really support the need. It doesn’t matter how effectively the business can deliver widget X to brick-and-mortar stores if there are no consumers there to buy it. The real danger in this line of thinking also lies in the possibility that your competition is considering digital transformation from the opposite viewpoint and will have customers firmly in their grip by the time you get there.
The proper path to digital transformation — especially for businesses that may be in peril — is to consider the consumer first. Discover how they are handling the path to purchase. Find out what the most important thing is to the consumer at the point of making a decision. Develop ways to get in front of them when that decision gets made. Look at your data, and define a core set of strategies that the entire organization can get behind. Understand your limitations operationally. Know your market and competition, and define where you are. Once you know where you are and have the goals in place for where you are headed, strategies spring forth that can get you there.
Brands with staying power are the ones that can see their customers clearly, leverage their own data and define experiences with technology to engage them. Digital transformation doesn’t come easily, and it’s not quick, but in the end, it can take the organization to places it may not have considered before.