Digital maturity is vital to profit growth: Here’s why

Organisations of all sizes and across almost every industry have embraced digital transformation and accepted digital maturity as an ongoing goal to work towards. Far too many companies, however, view it as a box-tick item. In doing so, they miss out on the significant return-on-investment opportunities that come along on the journey to digital maturity.

By Catherine Murray, Head of Digital Transformation, Enlight Strategic

Microsoft’s digital transformation overhaul, in response to disruption by companies like Amazon and Apple, moved the company into a more forward-focussed cloud-based business. This resulted in a whopping 258% stock price growth over 5 years. Over the period from 2014 to 2019 revenue increased from $93.5 billion to $122 billion.

Similarly, Nike’s ongoing digital transformation programme to reinvent its brand and supply chain and move into the ecommerce space has resulted in a 69% stock price growth in just 2 years. Its stock price was $52 at the beginning of 2017 – it’s now up to nearly $88. Revenue increased from $33.5 billion to $39.1 billion in that same time period.

Among the benefits that come with transforming digitally and becoming digitally mature are reduced business costs, improved customer experience, increased agility, and reduced time to market.

Combined, these benefits can play a massive role in growing a company’s profits. In order to understand how, it’s worth reminding ourselves what a digitally mature company looks like.

Constantly maturing

While there are a number of competing definitions for digital maturity, there are a few characteristics that the most mature companies have in common.

They will, for example, have a well-established transformation roadmap that effectively fends off disruption and evolves as needed. They also use digital technologies to run their business and have the ability to drive continuous change across the company.

Additionally, these companies realise that achieving digital maturity is an ongoing process rather than an end-point to be reached.

Is your business ready for transformation? Take our 5-minute Digital Maturity Assessment to find out and get a FREE report.

Analytical, data-based approach

A part of that ongoing process means organisations using their available data as effectively as possible.

For the organisations that get it right, the rewards are plentiful. According to research published by Entrepreneur in 2019, businesses that effectively use Big Data saw a profit increase of 8 – 10% and a 10% reduction in overall operating costs.

Getting to that point, however, is easier said than done. According to research from Gartner, as many as 80% of marketers will abandon their personalisation efforts in the next five years. It attributes this to a lack of real return on investment and the challenge of managing customer data.

In order to overcome those data-based challenges, it’s vital that the entire organisation buy into digital transformation as a mindset. In doing so, it will reap the benefits of a data-based analytical approach.

Customer experience and digital maturity

One of the biggest advantages of this kind of analytical, data-driven approach is that it allows companies to give their customers a hyper-personal experience.

And in a world where it’s increasingly difficult to differentiate on price and quality, customer experience (CX) can make all the difference. In fact, research from Gartner shows that more than 81% of companies are competing mostly or completely on the basis of CX.

Here too, the opportunities for increased profits are big. According to research from PWC, 49% of buyers have made impulse purchases after receiving a more personalised experience. Similarly, 66 percent of customers say they’ll pay more for a great experience, and experience-driven businesses see almost 2x higher YoY growth in customer retention, repeat purchase rates and customer lifetime value than other businesses.

Nike’s success is largely attributed to improving its connection with customers through membership opportunities, stronger digital marketing and powerful data analytics.

Nike started selling directly to customers and partnered with Amazon for an updated e-commerce strategy. This end-to-end focus on consumer touchpoints and data better allowed Nike to connect with customers more personally and recommend the right products.

The company also opened concept stores and improved its online and mobile app experience, and has since ended its relationship with Amazon to gain even more direct control over their CX.

Given that the interactions people have with companies now largely take place on digital devices and platforms, it’s clear that transforming digitally is vital to providing good CX.

A few simple changes can result in a massively improved digital customer experience, bringing with it significant profit growth. That makes taking the journey towards digital maturity a no-brainer.

Boosting productivity

Digital transformation doesn’t only boost revenue growth, it also impacts employee productivity. A recent survey by Zensar shows that a lack of proper technology tools can hinder productivity and lower morale.

53% of the surveyed employees said they would be more empowered to better manage workflow if they were provided with the needed tools. 76% also added that having the digital tools they need at work makes them more productive and more than half, 53%, said it makes them more successful.

Utilising digital technology to change traditional ways of working also results in lower business operating costs, as teams can work remotely and collaborate online. This also generates more employment opportunities which is critical for economic growth, especially in South Africa.

Opportunities abound

These are just a few examples of how taking the leap into digital transformation and embarking on the journey towards digital maturity can be vital for profit growth.

They are not, however, the only ones. If an organisation embraces digital transformation in its entirety, then everything it does will feed into improved efficiencies, better customer experience and reduced time to market.

This requires assessing the company’s digital maturity across all five main areas of the business: Leadership, customer experience, technology, operations and culture. All of these feed into one another and, ultimately, result in increased profits.  

Companies can then work with a consultancy to improve their digital maturity and get recommendations on how to address the problem areas to start their digital transformation journey.

Enlight Strategic offers a free online digital maturity assessment to help you get started. This will show you where the challenges and opportunities lie with taking your business to the next level.

Catherine is the Head of Digital Transformation at Enlight Strategic. She has over 13 years digital experience and specialises in customer experience (CX), digital disruption, platform and digital maturity analyses, research, and cutting though the noise, to find simple, pragmatic solutions to complex challenges.

Google’s new cookie policy is big, but savvy marketers can still thrive

Earlier this month, Google made sweeping changes to its Chrome browser, which could dramatically change the way online marketers gather customer data. Essentially, the update places strict limitations on third-party cookies with a view to eliminating them entirely by 2022. 

By Tanja Lategan, CEO, Enlight Strategic 

Marketers around the globe are railing against the change and pundits are suggesting it could see a massive shift to alternative browsers, such as Firefox, as the changes may render some websites unusable. 

Any resistance to change, however, is a little like screaming at the ocean in the hopes that it will stop being wet. 

Marketers should instead focus on ensuring that they have everything in place to take ownership of their customer data. It’s also critical that organisations start collecting this data now in order to build up historical databases before the three-year period has lapsed. 

Understanding cookies

In order to understand how big a change this really is, it’s important to remind ourselves how big a role cookies play in digital marketing. 

For the uninitiated, cookies are essentially pieces of text placed by websites on the hard drives of people visiting those websites. In doing so, they allow marketers to track which websites consumers have visited. As a result, they’ve formed the backbone of programmatic advertising, remarketing and ad targeting.

But they’ve also become controversial in the wake of Brexit and the 2016 US election, where they were used to build profiles of potential voters and target them accordingly. 

There is, therefore, more pressure to give users control over their own data, or at least be seen to be curbing the practices which gave rise to those issues. 

Google isn’t the first company to restrict cookies – Apple’s Safari and Mozilla’s Firefox have done so for some time. Google’s dominance of the browser market (Chrome accounts for 68% of desktop and 40% of mobile browser traffic) means that it doing so has a much greater impact. 

Is your business ready for transformation? Take our 5-minute Digital Maturity Assessment to find out and get a FREE report.

The future of marketing 

For anyone heavily invested in the current system, Google’s decision to ditch cookies can feel catastrophic. Certainly some marketing tech companies  took a hit in the wake of the news. 

But even if circumstances had been different, chances are marketers would’ve had to move on from cookies anyway. They are a legacy technology from a time when most people’s interaction with the internet was via the desktop-based web.   

Thanks to the near ubiquity of the smartphone, that world has been disappearing for some time now.  And, with the rise of connected TVs, smart speakers, and other technologies will make third-party cookies increasingly irrelevant. 

Savvy marketers have been preparing for that change for some time and are investing in new identification technologies. 

Groups of marketing technologists and digital publishers, for example, are working on Shared ID solutions which allow for a greater degree of privacy on the user side without compromising on the ability to provide relevant, targeted advertising to those who consent to it. 

Adapt and enhance 

That said, it’s important that marketers who currently rely on the third-party cookie ecosystem remember that they do have time to adapt. What they cannot afford to do is pretend that everything will be fine if the status quo is maintained. 

Even those who are ahead of the curve right now will have to adapt again in the future. This is the nature of marketing in a constantly-changing digital world. 

While that can sometimes feel intimidating, there is no reason for a marketer with the right partnerships in place to be overwhelmed and swept aside by change. 

Make sure that you have the right tools and technology in place to own your data starting today. Not sure where to start? Speak to a consulting partner like Enlight Strategic to future proof your business. 

Is your business ready for transformation? Take our 5-minute Digital Maturity Assessment to find out and get a FREE report.

Tanja is the CEO and co-founder of Enlight Strategic. She has more than a decade’s worth of experience as a senior executive in the digital publishing and agency space and is passionate about the role technology can play in transforming businesses.