Commerce-led vision through uncertain markets.
Northern partners with Acquia in this first in a series of articles that recommend where brands need to focus digital transformation as we exit the pandemic and enter new uncertain markets.
Digital transformation while exiting the pandemic.
While brands accelerated their digital adaptation to address commerce constraints during the pandemic, most need to revisit and manage technical debt from the rapid pace of innovation. Acquia calls this sprawl, which is growth that strains your digital ecosystem. Northern's Commerce Readiness Assessment helps brands identify and remove sprawl using a commerce-led digital transformation approach.
Need to Know
- Brands should assess and address technical debt resulting from rapid innovation during the pandemic.
- Many brands still suffer from a fragmented digital strategy.
- With the correct vision, digital transformation delivers valuable and sustainable returns.
- The commerce mindset is the vision that leads brands toward rewarding digital transformation.
Many brands still convey a fragmented digital experience.
The pace of digital transformation accelerated as a necessity during the pandemic, and we can congratulate ourselves because the growth was incredible. However, as we mature through the pandemic, we need to ensure that the systems rushed into operation can sustain further disruption. As Bloomberg Media Studies and IBM warned, "creating more resilient business operations is the only way companies will endure and thrive in the volatility we'll face in the years ahead."
To recognize fragments within your digital ecosystem, look for symptoms, such as:
- Your content management system (CMS) isn't flexible enough to accommodate accelerating customer expectations.
- You're growing internationally, and your CMS can't handle the variety and complexity of demands from new regions, languages, and regulations.
- You have a fragmented digital ecosystem with several siloed systems.
- Your eCommerce platform can't handle omnichannel commerce, making it difficult to compete with more innovative brands.
- The reverse logistics of product returns is draining your profit margins.
- There's no sense of a singular customer view, making it difficult for employees to create one-to-one relationships at scale.
- Your customer journey appears fragmented because of a disjointed digital ecosystem.
The predominant motivation for investing in digital transformation identified by Capgemini Consulting was pressure. Pressure from:
- Customers wanting more transparency and control (think self-service and choice)
- Competitors disrupting markets, making it challenging to keep pace
- Employees that expect their company to compete with the tech giants
- Globalization and growth through mergers and acquisitions
Digital transformation delivers substantial returns— with the correct vision.
McKinsey and Company suggest that five criteria distinguish companies that achieve successful digital transformation:
- Commerce Mindset: They use a North Star to drive strategy organization-wide.
- Cross-Functional Teams: They organize as networks of empowered teams.
- Fast-Fail: They employ rapid decision and learning cycles.
- Objectives & Key Results to Scale Vision: They use a dynamic people model to ignite passion and delegate authority.
- Modular Integrations via iPaaS: They engage next-generation technology and are agnostic about legacy systems.
Acquia's research identified that "consumers are willing to pay more for positive experiences," and companies that deliver superior customer experiences "typically grow at twice the rate of their competitors." Acquia knows that "today's customer experience is more than any single touchpoint - it's about delivering value across the entire customer journey."
Over a ten-year study, Capgemini Consulting and MIT Sloan Management surveyed billion-dollar organizations to understand the significance of digital transformation. They learned that:
- Companies with increased digital intensity earn 6% to 9% more revenue.
- Companies with increased transformation management intensity are 9% to 26% more profitable and achieve 7% to 12% higher market valuations.
McKinsey and Company echoed that sentiment after studying B2B digital leaders, learning that "digital leaders achieve up to five times the revenue growth and up to eight times the EBIT (earnings before interest and taxes) growth of their peers."
The commerce mindset is the vision that delivers results from digital transformation.
Dentsu claims that brands need to apply a commerce mindset throughout their operations. Every engagement between your brand and customers becomes a "shoppable" moment when you have a commerce mindset.
Peter Drucker, a legendary management guru, lectured that the purpose of business is to create and keep a customer - commerce transactions are the inflection points where consumers become customers. That's why Northern set commerce as our north star. And why we developed a Commerce Readiness Assessment to guide brands through digital transformation with a commerce-mindset.