Should the focus be on digital transformation or digital optimisation?

Tomas Salfischberger, CEO of Relay42, discusses how companies can successfully embrace digital innovation.

We are experiencing a major shift in the business technology landscape, with various emerging technologies such as artificial intelligence (AI), virtual reality (VR) and augmented reality (AR) all coming to the fore.

While most of these are used primarily within consumer contexts, the general consensus seems to be that each of them can also deliver valuable benefits within the world of business.

The opportunities available through digital transformation is something that many businesses are already aware of. Recent research from Capgemini found that 87% of companies believe digital transformation is a competitive advantage, while more than one quarter (27%) see the issue as a ‘matter of survival’.

Zooming in on marketing technology

Digital transformation has a knock-on effect across all business departments, but among those impacted the most is marketing. With more communications channels to consider than ever before, and the need to ensure all communications are personalised to consumers on an individual level, marketers rely on technology to help make their jobs easier and more effective.

There have been some standout examples of brands utilising innovative technology to deliver unique marketing experiences, including Marriott Hotels’ recent VR-enabled ‘4D tourism experience’. The application, called Teleporter, virtually transports users to Marriott Hotels around the world, giving them a taste of what staying there in real life might be like without having to leave the comfort of their own sofas. Not only is this a great use of technology, but it positions Marriott Hotels as a technological frontrunner, and a company that tech-savvy consumers will admire.

Transformation doesn’t always equal optimisation

However, the rush to jump aboard the digital transformation bandwagon often causes businesses to forget the reasons why they want to transform in the first place. This can lead to huge inefficiencies: having the latest technologies in place does not automatically equal increased effectiveness. Instead of thinking about things strictly from a transformation perspective, they need to start thinking about optimisation.

Ultimately, before undergoing digital transformation of any kind, it is imperative that all brands consider whether the desired technologies will deliver significant improvements over what is currently in place, and if so, how? This is the fundamental question behind all sensible business decisions, and should be asked when thinking about anything related to digital transformation.

For example, let’s say that a brand wants to undergo digital transformation in a bid to deliver hyper-personalised communications to consumers that, in turn, help to increase customer engagement and loyalty. The brand knows that the machine learning element of AI technology can help to achieve this, and so they march forward and invest a significant amount on the technology without asking any questions.

However, simply implementing AI within the wider marketing function won’t magically lead to successful marketing personalisation. Rather, the technology needs to be applied in conjunction with high volumes of customer data (the more data, the better) in a way that activates relevant insights for the business. Having an industry-based model with attributes key to driving conversion and retention in their industry will help marketers engage with relevant personalisation at scale.

Business value always comes first

In order to achieve digital optimisation over digital transformation, organisations need to adopt a ‘test and learn approach’ – one that allows marketers to try out new methods and technologies in a risk-free environment while using the results to refine their final approach. By learning to walk before they start running, businesses will be far more likely to benefit from their investments.

There are various data management solutions that can help marketers make better use of their data and orchestrate customers’ personal preferences, hobbies and interests into frictionless journeys. Ideally, marketers should try to take advantage of a platform that is agile, easy to set up and is flexible enough to accommodate all of the touchpoints and channels they regularly use — as well as those that they might want to use in the future.

As organisations begin to truly embrace digital innovation and marketers seek to improve their efforts through technology, it’s important to always put optimisation over transformation for the sake of it. Businesses need to combine these new innovations with what they’ve already got in order to deliver genuine business value. For marketers, this involves starting at the point of data and working your way up from there.

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