The Next Chapter in Digital Transformation: From Intuition to Impact
by Stephen Frieder
posted on 04-23-2019
In an era where practically every food truck—and even the neighborhood lemonade stand—has a social presence, it’s time we stop talking about the basic benefits of digital transformation and start talking about the way customer experience drives business impact.
Most businesses already recognize the basic benefits of going digital—call it an intuitive understanding. Everyone wants their digital experience to be personal, dependable, easy-to-use, engaging, and useful across every touchpoint. That’s the basic cost of entry.
But what does it take to create a truly great experience? That reality is much harder. Understanding your customer, creating experiences that meet their needs, and delivering them at scale requires your business to change. Existing practices, organizational structures, and workflows evolve. New technology is acquired and integrated. New expertise and roles are developed. And data—the fuel of the whole thing—has to be captured, analyzed, and acted upon with increasing velocity.
It requires significant investment to get right. Not to mention, the C-suite, the board of directors, and shareholders need more than intuition to justify the spend. That’s why the next chapter of digital transformation is about creating great experiences and driving great business outcomes.
Measuring business impact
I’m privileged to work with a lot of different types of customers. Some are big, some are small. Some have massive legacy businesses with a hundred-year brand heritage and some were born digital in just the last few years. There’s a few challenges they all have in common:
- The difficulty of keeping up with a growing number of channels and increasing customer expectations.
- Fragmented organizations that inhibit their execution of the customer journey.
- A growing need to measure the effectiveness of every dollar.
- The struggle to truly understand the customer and maintain customer-centered practices.
Fortunately, as digital businesses mature they develop strategies, expertise, and working platforms that tackle these problems head-on. Many are finding success and beginning to report significant return on investment in three key areas: cost savings, customer acquisition and retention, and bottom-line growth.
Customer acquisition and retention
The scale of digital platforms makes it possible to grow from zero to millions of customers in a matter of months, but it takes great customer experiences to drive that acquisition. Our customers turn to Adobe to give them a unified platform for understanding the customer, planning and executing on the customer journey, creating content, curating campaigns, and measuring their effectiveness.
Our customers saw 14% year-over-year growth in new, unique visitors from improvements in behavioral analytics, site optimization for organic search, and intelligent modeling and advertising retargeting to engage high-value customers. They also realized a 25% increase in web and mobile conversion rates attributed to improved personalization, optimized messaging, promotions, and content to targeted audiences at scale.
And the story just gets better. While acquiring new customers is great, customer retention is the new growth business. Think about it—establishing deeper relationships with your existing customers has always been great for business. They’re more loyal. They spend more. They share more about themselves. They refer new business and work as brand ambassadors for free.
Our customers realized a 10% year-over-year growth in loyalty program memberships, a $2.8 million dollars increase in bottom line growth, and $1.5 million dollars in cost savings attributed to improved experience metrics, loyalty program growth, repeat purchases, and personalized selling.
It may seem counter-intuitive to talk about cost savings and digital investment at the same time, but many of our customers have seen significant efficiency in content creation and deployment at scale by unifying their business around a common digital platform.
In fact, a recent Forrester study found that enterprise customers who deployed Adobe Experience Cloud reported payback of their investment in just seven months. Customers also saw operational productivity gains of $6.3 million dollars over three years from improved labor efficiency, new workflows, content creation and campaign efficiency, and deflection of call-center volumes. They also received an additional $2 million dollars in technology cost savings from the elimination of legacy systems.
Competitive edge for bottom line growth
When you add up the advantages of cost efficiency, improved acquisition, and the benefits of better customer retention, you see significant growth to the bottom line. Customers in our study saw a bottom-line growth of $22.6 million dollars over three years and an average return on investment of 242%.
At Adobe, we’ve seen these kinds of results in our own digital transformation.
We’ve also learned that having the right data platform critical for making everything work. We’ve established our own data-driven operating model and new metrics that align to our customer journey to help us understand post-conversion activities.
In part, these experiences have inspired our investments in data and analytics acquisitions—like Marketo and Magento—to build a platform with a more complete, holistic view of the customer.
We also recently announced—in partnership with Microsoft and SAP—the Open Data Initiative. Our collective goal is to help our customers eliminate their own data silos, derive more value from their data and deliver world-class customer experiences in real-time.
Remember, your data is your competitive edge when it comes to maximizing your digital strategy. If you’re ready to move beyond intuition and start the next chapter of your digital journey, think in terms of customer experience and business impact—then build a complete digital platform around it.
Topics: Digital Transformation