Digital transformation integrates digital technology into all areas of a business. Let’s look at the five key reasons why a brand would undergo a digital overhaul.
Table of Contents
1. To Meet Customers’ Needs
Creating a satisfactory consumer experience has become a top priority for most progressive companies.
Thanks to the expansion and growing popularity of smart devices, companies have more data on consumer demographics, experiences, and needs than ever before.
Global spending on customer experience technology is projected to increase from $500 billion in 2019 to over $640 billion by 2022.
Why?
Because 67% of consumers say that they would pay more for a great experience.
The modern customer demands convenience and 24/7 availability. Even if you have a superb product and/or service and years of experience behind it, customers are rightfully expecting the digital solutions to match it, or they’ll switch to competitors who offer them.
For example, if you limit customer service to an eight-hour window each day, potential customers who have questions they can’t find an answer to during regular business hours may choose not to purchase your product.
To remedy this issue, a growing number of businesses are implementing chatbots and even 24/7 live chat assistance in order to provide round-the-clock availability and in turn, an excellent customer experience.
Nurturing customer interaction improves company reputations and customer retention, while also securing a healthy conversion rate.
Every once in a while, you may notice a company that skyrockets to become a household name in a relatively short period of time. How does a business accomplish notoriety so quickly?
By offering their users a seamless experience.
Take Airbnb and Uber for example. Both companies developed apps that are intuitive and easy to use, further fueling digital transformation by forcing their competitors to keep up.
2. To Reduce Costs
Digital transformation consolidates processes and operations, which leads to reduced expenses.
By digitizing information-intensive processes, costs can be cut by up to 90%.
How?
Investing in the right software improves efficiency by automating repetitive and manual tasks of old, leaving your employees with time to focus on more valuable work. The aforementioned digital apps, for example, cut out the middleman between your business and your customers.
The steady rise of artificial intelligence (AI) technology and machine learning opens a slew of possibilities. They take over essential yet mundane and time-consuming tasks, leaving no space for human error. They allow companies to save time and labor costs, which in turn, equals revenue growth.
3. To Beat Out The Competition
Market competition was always a battlefield where product/service quality, customer satisfaction, and prices determined a clear winner. Now, companies are also competing through digital apps.
Just look at the arguably undisputed king of retail – Amazon. To remain competitive, everyone in the industry had to adopt new digital strategies, becoming more innovative in the process.
The popularity of Alexa and similar virtual assistants, as well as augmented reality technology, incentivizes businesses to find new ways of helping their customers make better-informed decisions online.
Even Netflix — the streaming service which singlehandedly ended giants like Blockbuster with a revolutionary new approach — is facing increased competition from streaming services like Hulu, HBO Max, and Disney+.
Each company aims to be more convenient to users and more accessible. In the end, everybody benefits from the competition — the consumer, arguably, the most.
In 2021, companies cannot hope to compete if they do not participate in digital transformation.
4. To Gain Data-based Insights
In a way, every company is a data company. Businesses going digital produce (and collect) more data than ever before and that trend will not only keep increasing, it will soon become an industry standard.
As digital companies collect, analyze, and utilize more and more customer relationship data, so will grow the pressure for competitors to do the same.
Some of the most common methods of gaining data-based insights include:
- Customer relationship management (CRM) and enterprise resource planning systems for data concerning customer purchasing history
- Customer support systems including internal product analytics and customer satisfaction surveys
- Google Analytics, Google Search Console, and similar marketing technology platforms used to collect online behavior data
- Collecting and interpreting data gives companies invaluable insights into how to run and grow their business.
Using these types of algorithms and analytics will allow your brand to better answer to and predict your customers’ needs in new ways, helping you preplan and even react appropriately when necessary, to reach new customers.
5. To Drive Efficiency And Encourage Collaboration And Innovation
The COVID-19 pandemic changed the way many companies operate and collaborate.
Platforms like Slack, Microsoft Teams, Zoom, and project management tools like Teamwork, Asana, Trello, and Basecamp are being used all over the world, now more than ever, to streamline communication.
Each of these project management tools is designed to guide your team and help you track project statuses, communicate effectively, set milestones, and meet deadlines.
Internally, these platforms and tools allow the efficient sharing of ideas that can lead to new and innovative solutions.
The decision to go digital means that every aspect of your business will likely transform, making it imperative that everyone in the company is on the same page. Streamlining communication and project management can help achieve a seamless and simple transition.
