Transformation is happening everywhere.If you are at all familiar with Jeffery Star Cosmetics or any of the popular social influencers who now sell product lines in major stores, or directly to consumers, you will realize we’re far from the days where Revlon and other major brands ruled marketshares.
If you can’t relate to cosmetics, you needn’t look further than your dinner plate to realize that even your rice has been transformed intocauliflower. And if you can’t relate to that, don’t worry,you aren’t missing much.
I recently spoke at Mar Tech West in San Jose, California, about today’s transformation of the data dimension, which is primarily digital in nature. “The world is moving, and a company that contents itself with present accomplishments soon falls behind.” Ironically, this great quote comes from George Eastman, founder of Kodak. We all know what happened there. Kodak is probably one of the most studied cases of a company “missing the signals” to adapt to a changing customer environment.
"Today’s digital technologies are rooted in intimate abilities to track and understand customer behavior to help brands understand where they are and aren’t meeting customer needs. Yet, “Even digitally savvy industries, such as high tech, media, and telecom, are struggling"
From Kodak to Glossier, we see the business landscape change dramatically with customers becoming the stakeholders. Emily Weiss, the founder of Glossier, is Silicon Valley’s newest unicorn. Her company has received over $100M dollars in venture capital funding, is valued at $1.2B, and is paving the way with its direct-to-customer model. Today, transforming a company usually involves a strong digital component.
Digital transformation can be defined as a company’s ability to notice, evolve, and pivot to the changing business landscape by altering its processes, business models, and competencies leveraging digital technologies. Today’s digital technologies are rooted in intimate abilities to track and understand customer behavior to help brands understand where they are and aren’t meeting customer needs. Yet, “Even digitally savvy industries, such as high tech, media, and telecom, are struggling. Among these industries, the success rate does not exceed 26 percent”, as noted in a McKinsey report on digital transformation success. Digital transformation success relies on three critical areas: organization design, data collection, and tools.
During transformation, data can reveal leading and lagging indicators in your business. Choosing to create a strategy based on this data is critical to your company’s short- and long-term success.
At Autodesk, we experimented with two tests where we looked at data surrounding leading indicators in our business that indicated consumer confusion. Latency statistics and purchase funnel data (how long it takes for a customer to make a purchase) play critical roles in observing where your digital messaging strategy may be weak. Based on our data we decided to test out a few theories around two leading indicators we identified as areas that could lead to double-digit business growth, if improved.
Leading Indicator: Purchase Cycle of 68 Days
Pathing analysis showed us the purchase cycle for one of our products was 68 days which is a great data point that showed us customers were still confused about our offerings, or had additional questions,causing them to stay too long in the “consideration” phase of the purchase funnel. Pairing up with a web development lead, we crafted a chat bot that gave customers the information they needed based on past data we had analyzed. This helped us increase time spent on page by 109% and accelerated purchase conversions by four times.You can read more about it here.
We realized customers weren’t getting the critical information needed to make a purchase decision early on, so we crafted an AI-based chat experience that pushed that information towards the start of their interactions with our brand.
Leading Indicator: Low Homepage Conversion & Time Spent on Page Metrics
We ran a test on our homepagewhere we talk about our product and its features. By analyzingthe amount of time spent on page and the keywords customers search for,we realized that our information wasn’t meeting the needs of the customer. Embedding those most-used keywords into the headline of the landing page increasedpurchaseconversions by 38%.
Focusing on customer data on how they want to interact with your brand paired with the customer journey are the most under-optimized areas of not only digital marketing, but marketing as a whole. Utilizing this datacan help companies successfully transform digitally.
The data dimension of transformation highlights opportunities as to where and how to pivot your business for growth.
Tools today can help accelerate learning and automate experiences. But the language and acronyms are increasing at a dizzying pace. From DMP (data management platform) to DSP (demand-side platform) to CDP (customer data platform), keeping up with the terminology can be a challenge of its own. MarTech charts like the one produced by Scott Brinker and team show over 7,000marketing technology and automation solutions offered to businesses.
See full view graph here.
Today, tools like a CDP (customer data platform) can easily help with segmenting customers and personalization of the experience for them at scale leveraging automation. CDPs work with a company’s first party data, meaning all the customers that are inside their online/site and touchpoint ecosystem. Leveraging a CDP can be critical for companies that have a subscription model with a lot of leakage where they need to distinguish between existing and new customers, to be able to provide a more tailored experience for both groups.
By taking customer data across all the touchpoints they interact with—product trials, direct mail, emails from the company—and aggregating them into a data table, companies can tag and segment that data for predictive analytics, as well as understand relationships between variables.Like how customers who purchase during a certain time of year are more likely than average to purchase a second time.
Using that information, companies can create specific personalized experiences for those kinds of customers to get them the information they need in a more tailored way, accelerating the customers’ loyalty and reducing customer attrition after purchasing, as well as locking them in for any future purchases or upgrades.
A CDP is usually used for internal customer personalization, but at Autodesk we’re also experimenting with exporting some of those experiences to acquisition as well.
As with any transformation, data is at the heart of ensuring that a company take the right steps forward to help create and sustain competitive advantage. Using data to curate the perfect customer journey can be invaluable. For example, with millions of customers, Birchbox has still not been able to lock down the right personalized experience for its customers. With half the number of customers as Birchbox, but a better command of the data, Stitch Fix has created a near-industry standard surrounding data usageand implementation to help perfect customer personalization.
Data is one of the three pillars of digital transformation and its inter-relationship with tools and organization design makes it a necessity for success for any company. Tools in the marketing technology stack can help uncover, accelerate learnings, and create experiences atscale,generating successful strategies and driving success in digital transformation initiatives.