Back in the old days (like 2005!), to find information about a product, people contacted a salesperson, visited a retail location, or waited for the company to advertise or email information out. Things have changed dramatically since then. A recent CMS Report story, What is Visitor to Lead Management, cited the statistic that 74% of buying decisions are made in advance of the first sales call. Customers are getting the answers they need way beyond them ever contacting your salespeople. That is astonishing.
So where do these customers get information from to make their buying decisions? Naturally, they get a lot of it from your digital presence – your website, social media talking about your products, etc. It follows, therefore, that your leads ought to be coming from people visiting your website or your Facebook page or Tweeting about you. As a result, you want to make sure the content you are publishing is consistent, comprehensive and can lead a potential customer to the right buying decision. In short your Content Management System is at the forefront of your lead management system.
In the CMS Report article, the author describes the following major themes you should consider when looking at your content system:
These ideas lead to the fact that your content management system also needs to integrate well other other lead management systems, like your Customer Relationship Management (CRM) system, your Marketing Automation systems and even your help desk/customer support centers.
Once you have mastered Visitor to Lead, then it is time to take on “Lead to Revenue”. This process describes the sales funnel that many people know. Over at Forrester, Lori Wizdo is considered an expert in Lead to Revenue. You can follow some of her research on her blog.
When you start to think about what it takes to be a digital business today, you may think that you have to be doing some form of e-commerce. Or, you may come up with the idea that you need to focus on improving your customer’s digital experience.
It turns out that there are lots of elements of a digital business to which you should pay attention. Dion Hinchcliffe and Steven Mann at Adjuvi produced The Elements of Digital Business diagram shown here that provides a good overview of the many areas considered part of being a digital business.
Of course, you don’t have to implement all of these elements as part of your digital transformation. But it is important to understand the various elements to see if there could be something missing from your portfolio.
For example, your company may be best suited to offer APIs (think IFTTT) rather than e-commerce. Or maybe you have a good customer experience platform but lack a great search experience.
As you evaluate your digital transformation progress, keep this picture in mind, and make sure you are addressing the key elements for your business.
Connect with Perficient on LinkedIn here.
The whole concept of a digital transformation would predict a sharp decline in non-digital advertising budget as the digital channel becomes much more important. I don’t have statistics but here’s anecdotal evidence. Entrepeneur.com has an article about Quiznos new Ad strategy. They are pulling TV ads entirely although they will keep print media ads.
“Our advertising budget is kind of split between print media and digital, with a higher weight on digital advertising,” Tim Kraus, the director of interactive and innovation at Quiznos, told Entrepreneur. “Within that, probably our primary focus is on video.”
When Kraus says that Quiznos’ advertising dollars are split between print and digital, savvy readers may have noticed he didn’t mention one huge advertisement platform: television. That’s because, at least for now, Quiznos is ditching the traditional method that still dominates advertising spending. And it does dominate: in 2014, digital video ad spending is estimated at nearly $6 billion, while TV ad spending is about $69 billion, according to research firm eMarketer.
However, when Quiznos was forced to take a hard look at how they divvied up their ad dollars after declaring bankruptcy, television just didn’t make the cut.
“We’ve been around for 30 years, and we were a big TV advertiser, we were a big print media advertiser. And, we just saw the returns on some of these campaigns diminish,” says Kraus. “The consumers we’re trying to target are spending way more time online.”
So there you have it. It’s telling that the they pulled from TV because they recognize where most of their buyers spend their time.
Mckinsey has a great research article that fits digital transformation to a “T.” It’s titled, “Do You Really Understand How Your Business Customers Buy?” It’s long enough that I cannot do it justice in my brief synopsis and a highlight of key points so go read it. Here’s the key: how businesses buy complex items, software, and services is becoming more consumer-like. That doesn’t mean businesses do less research or have less process. It means they will buy in a new manner with a lot of research done in their way and not according to your sales funnel. Here are a couple quotes to make the point:
Welcome to the new dynamics of B2B sales. Decision-making authority for purchases is slipping away from individuals in familiar roles—often those with whom B2B sales teams have long-standing relationships. Just as the digital revolution has transformed once-predictable consumer purchasing paths into a more circular pattern of touch points, so too business-to-business selling has become less linear as customers research, evaluate, select, and share experiences about products. More people within (and, thanks to digital engagement, even outside) the organization are playing pivotal roles in sizing up offerings, so the path to closing sales has become more complicated.
Flows of digital information have further democratized business procurement. Our research indicates nearly 50 percent of all B2B purchases will be made on digital platforms by the end of 2015, and expenditures for B2B digital advertising are expected to double by 2018. Empowered purchasers increasingly demand real-time digital interactions supported by tools such as product configurators and price calculators. And they are doing all this while texting, e-mailing, and talking regularly with on-the-ground sales teams, distributors, behind-the-scenes inside sales groups, customer-service call centers, and technical reps. Our research shows that, on average, a B2B customer will regularly use six different interaction channels throughout the decision journey, and almost 65 percent will come away from it frustrated by inconsistent experiences.
Business customers are exposed to the same dynamics of peer-to-peer networks and opinions that influence individual consumers. The equivalent of Facebook’s “like” button also applies to B2B sales. Many of the one-to-one relationships with key decision makers that sales executives historically relied on to close sales are shifting to one-to-many relationships. Moreover, the actions of important influencers (including senior executives) in the purchasing process are often less visible to suppliers. Customers may be “liking” or “not liking” a prospective offer long before the sales rep has even presented it.
So, by now you get it; the buying process is on their terms, and there’s only one way to respond to this type of change: embrace it. McKinsey highlights how other businesses reallocated budgets to better target their buyers according to a new buying model. That makes far more sense than just cutting budget or piling on more $$ to make your process successful.
What impact does this have on digital transformation you might ask? It’s simple. Digital transformation requires a change not only in technologies used but also in how you go about addressing digital channels in the first place. Take a holistic view and be ready to make changes to your processes and technologies.
Connect with Perficient on LinkedIn here.
Via cmo.com, I saw an infographic on what Social Content technology buyers user or intend to use. I have to admit I was a bit shocked by the data Eccolo Media was able to find in its survey. While I consider blogs to be a valid and valuable media channel, I haven’t considered Facebook, Pinterest, and Tumblr to be a top 10 of any sort. So imaging my shock when 34% of respondents said they found content via Facebook…….
Here’s an even more interesting stat:
LinkedIn was winning by a substantial margin, but Facebook took the lead and looks to make significant gains. I find this interesting because I use LinkedIn, YouTube, and blog sites for research purposes, but I haven’t found anything on the more consumer-oriented sites like Facebook.
Looks like I have some more research to do on my own.
Check out the infographic for lot more information. It’s a lengthy one.
Thanks to Robert Hardin, who both saw the article and wrote up a quick response with his thoughts.
The WSJ CIO Network (behind a paywall) recently published their top five initiatives for 2015. Outside of the growing concern around cyber security and the associated business risk, the next two focused on the impact that Digital Transformation is having on an organization, the CIO as a change agent and having a business-centric vision.
In an interview at the same event, John Chambers, CEO of Cisco, predicts that upcoming digital transformation will be so disruptive that 33% of all management teams will not survive the transformation. He also acknowledged that IT is again growing in board room discussions because technology is so deeply embedded in business strategy.
With technological change happening at a much greater pace, every area of the enterprise is being impacted by technology. Everyone and everything is becoming connected, and with it comes the challenges to leverage those capabilities to outperform their competitors. It is switching the focus from the products and services that we sell to the outcomes that our customers want from our products and services.
Digital transformation is changing the questions that we are trying to solve. Are we changing with them?
See the Wall Street Journal for the entire article.
This is more of a follow up to my post yesterday on Digital Marketing costing a lot and being worth it. CMO.com has an article on marketers finally getting Google to the point where click through rates are up 19% year over year.
“Marketers are optimized almost fully on Google,” said Tamara Gaffney, principal analyst at ADI. “They are getting much better CTRs, and the CPCs are not as high as the CTRs are, in terms of growth. Marketers are also incorporating Yahoo Bing into their strategies, which is seeing an increase in SEM spend globally and in the U.S. Although spend is increasing, CTRs are still flat, showing that marketers haven’t yet optimized Yahoo Bing as effectively as Google—that’s obviously the next frontier. The other frontier is paid Facebook, which is currently in the acquisition phase, and marketers are fully entrenched and quickly becoming fully optimized.”
So take away a lot of marketing speak and simplify it………. Marketers spends an awful lot of money on Google Ads. With the help of a variety of powerful tools and their own increased experience, they are seeing much better results……
Jonathan Gordon and Jesko Perrey at the McKinsey & Company blog have an interesting and longish post on the Dawn of Marketing’s Golden Age. While most of the post focuses on changes in marketing and why that has created a new golden age, there are a few nuggets worth thinking through from a digital transformation perspective. But first, the marketing component:
The resulting expansion of platforms has propelled consistent growth in marketing expenditures, which now total as much as $1 trillion globally. The efficacy of this spending is under deep scrutiny. For example, in a survey of CEOs, close to three out of four agreed with the following statement: marketers “are always asking for more money, but can rarely explain how much incremental business this money will generate.”1 Chief marketing officers (CMOs), it appears, don’t disagree: in another recent survey, just over one-third said they had quantitatively proved the impact of their marketing outlays.2 Paradoxically, though, CEOs are looking to their CMOs more than ever, because they need top-line growth and view marketing as a critical lever to help them achieve it. Can marketers deliver amid ongoing performance pressures?
In this article, we’ll explain why we think the answer is yes—and why we are, in fact, on the cusp of a new golden age for marketing.
Since when do you see anyone without qualifications state that the massive investment in additional spending will pay off? You don’t see it often, but I agree with the sentiment. The changes have huge potential to benefit those who make such an investment. McKinsey gives five reasons why this will happen:
Now as you think about that, note the digital transformation occurring:
The impact goes beyond marketing and product teams. Marketing science is boosting the precision of real-time operating decisions. At a major hospitality company, marketing analysts are able to get a read on the performance of a particular property or category over a weekend and then drill down on individual customer segments to assess how to make improvements. If the data show that a profitable segment of weekend travelers are shortening their stays, the company can create special offers (such as late checkouts or room upgrades) to encourage repeat business.3 Or consider how one industrial-products company revamped its highly fragmented portfolio of more than 500 SKUs sold to customers in a diverse set of industries. Prices varied widely even for the same products, without any clear reasons as to why, hindering efforts to manage margins. An analytical tool that could scan 1.3 million transactions helped the company redraw customer segments, identify products with opportunities for pricing flexibility, and recommend new prices. Ultimately, it reset about 100,000 price points.
That’s good, because digital innovation, transparency, and customer-centricity have raised expectations across the board. In automobiles, as sensor technologies proliferate and onboard computing power increases, consumers are now starting to expect that collision-avoidance and digitally-enabled safety systems will become part of manufacturers’ offerings. (Luxury carmakers already are making sophisticated safety options part of their marketing story.) In retail, brands like H&M, Topshop, Uniqlo, and Zara have harnessed the consumer’s desire to have it all by bringing mass-market prices to the colors, fabrics, and designs of high fashion. Simultaneously, Amazon and other digital players are pressuring brick-and-mortar retailers, which are responding both by retooling their supply chains to enable faster restocking and one-day delivery and by creating new advertising messages around the in-store pickup of online orders.
These technologies are now impacting the physical world in more positive ways. They do so through the use of digital tools related to marketing and to back office operations.
In other words, digital marketing is just a small part of the digital transformation story.
The term “Digital Transformation” is very broad and all encompassing, but more recently has become mostly closely associated with the activities and strategies to compete against disruptive trends brought about by new business models emerging due to availability of new digital platforms. Within the last decade we have seen an emergence of very economical compute infrastructure, wireless and broadband, and software platforms that enable rapid development of applications, which can scale to support millions of simultaneous users. What would have cost companies hundreds of thousands in investment just five short years ago can now be delivered for tens of thousands.
But, availability does not equate to disruption. Disruption is formed because individuals and small teams can now afford to quickly translate their ideas into usable applications. Moreover, they can continuously innovate on their original idea in a rapid manner allowing them to a) test new concepts with their consumers to ascertain the level of further investment and b) add new capabilities that keep their audience engaged and continuing to use their product.
When these disruptive businesses are compared to an established businesses that have significant investments in large-scale enterprise software and have built up technical debt—a concept that describes how system design choices continually incur a penalty until corrected—the disruptive businesses have the advantage of being more nimble and more responsive to users’ needs. Somewhere you can hear the CEO of one of these more established businesses screaming to the CIO, “Engine room, I need more power,” and the CIO responding, “I’m giving you all she’s got Captain!”
The truth of the matter is, the CIO may be giving all he/she has, but that’s because they haven’t reconfigured their engines to use the latest technology. More succinctly, many businesses are still confused by or misunderstand the risk and value proposition for using public cloud service providers. Moreover, they have not addressed the bottlenecks and constraints that limit their ability to deliver functionality and capabilities to their business users more quickly with high quality, such as is provided by adopting DevOps concepts and practices.
If technical debt addresses too little investment in upgrading, poor vendor selection, bad platform selection, etc. then, many businesses have also built up organizational debt. Organizational debt could be over regulation, too many low-value policies, to much middle management attempting to hold onto their area of control, and too much governance. If these are not revisited often to ensure that they are continually adding value for the cost of reducing throughput, then that organizational debt will continue to increase backlog
Change is difficult. Transformation is exponentially more difficult than change. This Harvard Business Review article entitled, “We Still Don’t Know the Difference Between Change and Transformation,” does a great job of explaining the difference between change management and transformation. As described in the article transformation deals with reinvention. Reinvention, in turn, will require businesses to revisit their long-held beliefs for how to deliver their products and services. I posit that businesses that cannot harness the cloud and DevOps will not be able to successfully make the digital transformation and, as pointed out in this summary of a recent Accenture/HfS Research report will lose ground to competitors quickly in the next couple of years.
The Harvard Business Review Article, “The Strategic Value of APIs” says, “…there are multiple ways APIs can generate growth for companies. While many may see APIs as just a technical concept, they clearly overlook the rising strategic significance of APIs. Particularly with the internet of things bringing digitization to all kinds of products and services, the influence of APIs is growing far beyond technology firms. All CEOs may soon need to
find ways to align APIs with their growth strategies.”
The three major trends of social, mobile, and cloud are greatly impacting how businesses and customers connect and engage with their customers and employees. APIs are a foundational technology that enables companies to participate in the digital economy. APIs open up the potential for the creation of entirely new businesses models or the establishment of new primary channels for products and services. The ecosystem created by connected enterprises, customers and suppliers via APIs have an economic effect – The API Economy.
Providing programmable access to systems and data can provide strategic and economic value. For example, the APIs provided by Amazon, eBay and Facebook are the primary means for paying customers to access their platforms. Like these born-on-the-web companies many traditional companies are looking to provide systems as platforms and offer information and services via APIs. These platforms require a modern architecture as well as a business strategy to monetize APIs.