The 3 Components of Digital Transformation

Has your company really begun a Digital Transformation process?

We talked in the previous article about What Digital Transformation is (and what it is not). A little introduction to the topic was necessary, so that starting with this article, we can go into more depth and understand what the 3 components of digital transformation are.

But who is the term Digital Transformation creditable to and when did it originate?

Some sources on the web, claim with fair conviction, that the reference year is the end of 2011 and the attribution seems to go unequivocally to the consulting company CapGemini in collaboration with the MIT Center for Digital Business.

Let’s start with the definition that the researchers of the aforementioned organizations gave and that is still particularly interesting today:

Digital transformation involves the use of technology to radically improve the performance or the reach of businesses.

This definition is particularly interesting to understand how, as usual, in Italy and in most of Europe we haven’t understood a f*** thing!

Indeed, many companies have interpreted the digital transformation process over the years by equipping their employees with mobile devices or simply creating cloud infrastructures to store their files.

It would consequently be very easy for me to say that this is not digital transformation, but let’s try to be concrete. How do we know if we have actually started a digital transformation process and if we are going in the right direction?  

The 3 Components of Digital Transformation

There are three measures and indicators of digital transformation in the recent literature that are commonly referred to as the 3 components of digital transformation:

  1. The processes
  2. The operations
  3. The relation with the customers

Transformation of the processes

Let’s start with the first point. I always have questions when I visit companies where employees still rely on paper, pen and file cabinets. Or in other companies, within which people communicate via email and cell phones. 

A successful digital transformation means implementing entirely new technology and processes. Sending a purchase order via email is not a new process; it’s simply a more modern way of doing something you’ve always done. Automating the submission of a purchase order, on the other hand, is.

It is because it saves time. Because you’ll be able to allocate your employees to other tasks. Because it will improve your business efficiency and customer satisfaction.

Transformation of operations

Let’s move on to the second point, those operations. I once approached a company that had a single supplier, not out of convenience but out of laziness. They called me and told me that the supplier was in trouble and had found themselves unprovided for, having no other business relationship.

What if they had had someone advise them early on that that business strategy was dangerous? What if they had implemented a system that automatically allowed them to track suppliers by individual product? What if they had automatically linked to their pricing list?

First of all, the entrepreneur would not be in trouble, having to resort to a new business contact on which there is no history.

He/she also wouldn’t have wasted time manually searching for other vendors, and let’s always remember: time is money.

Finally, it would have obtained higher margins from automated purchasing from the most convenient supplier at the time.

No more phone calls, wasted time or allocated resources. Automation of processes, certainty of agreements and independence of positioning.

Transformation of user experience

Let’s try to admit that in the first two points, with a dash of courage and a bit of luck in choosing the right consulting agency, it’s relatively easy to notice the impact of a digital transformation on your processes and operations. 

It gets more complicated when it comes to customer experience and satisfaction.

However, digital transformations have a enormously significant impact on how customers interact with your business and how they perceive those interactions. 

For example, have you ever wondered why you buy from Amazon? If you’re answering for the prices, you’re wrong. Amazon has prices today that are on average higher than the average competitor. You buy from Amazon because of the customer satisfaction, especially post-sale, that you have accumulated in the most negative experiences.

What happens, for example, when one of your customers doesn’t receive an order or wants to return it? If you have an automated system, in a few minutes the request will be completed and in a few seconds the final response will be packaged.

If you don’t have it, one of your employees will have to manually respond to the email and after hours will still not have solved the problem definitively, because they will have to wait and sort for example the tracking code.

The advantages of digital transformation for your business

Summarily analyzing the 3 components of Digital Transformation, we can say that embarking on a digital transformation journey offers 4 benefits:

  1. It increases the accuracy
  2. It improves the speed
  3. It reduces costs
  4. It makes your business more efficient

But if that’s the case, you can’t ignore talking about and making measurable RoI (return on investment. This is a step we’ll explore in one of the next articles. Because perhaps it is a representative indicator of how to apply digital transformation and how NOT to apply it.

Aloha!

E-commerce: what is it and why create an online shop

What is an e-commerce?

Today we are talking about the phenomenon that has revolutionised and redefined the world of marketing in recent years: E-commerce.

Giving a single, comprehensive definition is not easy, but we could define e-commerce as the sale and purchase of products and services on the web via online payment methods.

We must be clear right away. E-commerce is much more than a transaction in electronic form: it is the ability to intercept the customer’s need in a clear and measurable way.

The fact that the customer has many more products available online than a traditional shop can contain implies that your e-commerce is taken care of in every detail.

This involves several factors: from the IT aspect to the communication aspect, from the care of graphic elements to the development of an engaging user experience.

Why do you need to sell your products online?

E-commerce is the result of the digital transformation process that has now affected every sector. If until recently being online was a choice, today it is a compulsory step for any business that wants to innovate, be closer to the needs of its customers and, last but not least, resist the blows of competition.

 Let’s see why!

Does your target audience need your online presence?

Absolutely!

The emergence of e-commerce has revolutionised the concept of retailing, expanding its possibilities. By exploiting the potential made available by new technologies, e-commerce makes it possible to devise ad hoc strategies to address specific targets.

The use of valuable tools such as online communities ensures that even very distant slices of users can be reached, reducing the costs of a much more time-consuming process in traditional commerce.

People play a central role: they determine which direction the market will go. Users browse online, inform themselves, compare similar products and ultimately choose the one they think is best. In such a situation, being absent on the web can only be a disadvantage.

Covid-19: digital transformation becomes necessary

As if all this were not enough, the latest developments in the global pandemic that have led to the ever-increasing spread of Covid-19, disrupting customers’ habits even in terms of purchasing basic necessities, have caused the digital transformation process to accelerate even further. Indeed, the pandemic has prompted more and more consumers to turn to online commerce for purchases that were previously conducted in person.

This shift inevitably leads one to wonder how user behaviour is changing. Online transaction volumes in Italy are estimated to have grown by 15.4 per cent in the last year, leading e-commerce to face 10 times more demand than in the pre-Covid period. The need to maintain social distancing leads to the exploration of new ways of buying online, with the high probability that these trends will remain unchanged even after the pandemic.

It seems that the transition to e-commerce is something inevitable, which is why having a valuable web presence is necessary and indispensable.

If you are not yet online, now is the time to do so!

What are the benefits for a company with e-commerce?

The benefits you may derive from setting up an online e-commerce are manifold.

  • Analysing data from online user behaviour allows you to create a tailor-made communication strategy, minimising criticality and maximising the effectiveness of your action.
  • Study the behaviour of your competitors, identify the strategies adopted and understand what to focus on to overcome them.
  • Find out which keywords appeal most to your audience and use them to improve the visibility of your business.
  • Attract new customers through traffic generated by search engines and social media, increasing your user base.
  • Having the ability to provide all the necessary information to reassure the potential customer in order to induce him/her to buy, through an efficient customer care service.
  • Gain flexibility by ensuring that users can buy anytime, anywhere.
  • Multiply business opportunities by devising a coherent strategy that combines online and offline marketing.

The 4 types of e-commerce and which one is best suited to your business?

Are all e-commerce businesses the same? The answer to this question is “no!”. We tend to think that selling ‘online’ is exclusive to the B2C market.

When we talk about e-commerce we almost always refer to 4 main categories that are strongly related to your target market:

  • B2B (business to business): This type of e-commerce refers to exchanges between companies of products, services or information. These are product or supply exchange websites that allow companies to support each other in the activities necessary to produce a product or service.
  • B2C (business to consumer): indicates the relationship that is established between companies selling products, services or information and people, understood as consumers and the target of the marketing strategy. Retail shops are the most common example.
  • C2C (consumer to consumer): The term refers to the type of electronic commerce in which consumers exchange products, services or information online. This is made possible by the provision of sites on which transactions are carried out. The earnings of these platforms are derived from the percentage derived from user transactions. Online auctions can be classified as examples of C2C e-commerce.
  • C2B (consumer to business): is a type of e-commerce in which consumers make their products and services available online, with the aim of selling them to companies. This takes place on intermediary platforms. Common examples are blogs or forums that offer the possibility of including links to the company’s website, promoting its products.

What is involved in having an online shop?

In order to start an e-commerce from scratch, one should not underestimate certain steps prior to going online.

Having a business plan and carrying out a convincing online promotion activity are fundamental operations, which must, however, be conducted by a specialised team.

E-commerce business plan

Having a strategic guide that allows you to focus on the goals your company aims to achieve is as challenging as it is necessary.

An effective business plan is based on a detailed description of the company and the reasons for taking certain actions.

  • What needs do you intend to satisfy?
  • What is the target audience of the online shop?
  • What professional skills are available for the realisation of the project?

The plan should illustrate the offer to be presented to the target market, as well as a collection of information on the environment within which the business is to operate. It should then outline the traits of the companies that represent the competition: from describing the competitor’s offer to highlighting its weak points, and finally to elaborating a strategy that aims to make the difference between your business and its rivals.

All this without neglecting the elaboration of economic-financial forecasts that will allow you to derive projections on the progress of the project.

Another point to focus on concerns the communication plan adopted. Equipping yourself with a corporate blog that deals with topics related to the field you operate in, doing good SEO optimisation and focusing on social media marketing… Everything is necessary to gain online visibility for your e-commerce!

Getting people to engage with your communication channels through informative content on blogs, email marketing and social media activities is an important step towards gaining loyal and satisfied customers.

Rely on professionals to create your e-commerce from A to Z

Any website that wants to gain and maintain contacts and visibility needs an investment. Not all investments are successful, however, so a wise choice must be made.

Relying on professionals who can understand your needs and guide you in the implementation of your business project is absolutely necessary. Great care must be taken when choosing the most suitable web agency: one wrong step and the risk of losing time and money is just around the corner.

At Biscuitway, we are a Growth Agency with a focus on the all-round growth of entrepreneurial projects.

Tell us your project and together we will find the right key to grow your business!

Digital Transformation: what is it? And… what isn’t it?

A lot of people talk about Digital Transformation, but are we really sure we’ve hit the mark?

I’m going to try to take all the smoke out of your eyes!

I’ve been thinking a lot about how to start this article on Digital Transformation. First of all because it’s the first article of the newborn BiscuitWay blog; secondly because the theme is cool and…. cool things usually need cool words.

Then I realized that the cool stuff is usually done by marketeers, and if I’ve learned one thing over the years it’s that sometimes what comes hardest is getting to the gist of it.

So no secrets to success! No tools that no one told you about! Not even formidable advice that will tell you which book to read (with an invitation to buy it on Amazon and an affiliate link) in order to immediately become the innovator of yourself or your company or…. of your property.

What is not Digital Transformation?

Let’s break the ice! We give a dry answer on what Digital Transformation is NOT. Digital transformation is not a standardized website for a few euros, it’s not even e-commerce, it’s not wow management. It is not at all the opening of your fantastic company page on Facebook or LinkedIn. No, I guarantee you.

The good fortune and bad fortune of the web is that you need to be online, but that is not enough to get customers to find you. And even if they do find you, it is not necessarily helpful to your business, quite the contrary.

What is Digital Transformation?

But let’s try to say what Digital Transformation is. To me, Digital Transformation is a change in vision and approach, to put it coolly, a change of mindset.

Let’s take a practical (and not a polished) example. In Italy about 76% of companies are SMEs (so the whole universe starting from micro enterprises to go to small and medium-sized). But let’s try to imagine the case of a shopkeeper.

One of those who for 20 years raised his shutter, turned on the lights, worked inside a store of 36 square meters and waited patiently for his customers.

Well, today, this man, this hero of modern times (and I’m not kidding!) doesn’t need a website. He needs to open his mind to new paradigms for the growth of his business; someone to help him detect his potential and critical issues; someone to analyze with him what he really needs to reduce costs and increase profits.

So let’s start with some basic concepts. Digital transformation cannot be separated from the concept of innovation. And let’s kick off the first more than honest quotation:

Digital Transformation: Not just doing new things, but also doing old things in new ways
Innovation can be the way. But remember that innovating means not only doing new things, but also doing old ones in a new way. (Javier Goyeneche)

The excellent Javier, as we like to call him in convivial moments, in my opinion has hit the nail on the head. Many have spoken of digital, web and innovation as the Land of Toys and in recent years have also made a lot of money.

But I remember very well what happened to Lucignolo and Pinocchio, just as I know very well what happened to those entrepreneurs who plunged into these processes without criteria.

After the race to innovate, entrepreneurs and professionals terrified by investments with no utility or return have given up and retreated into their traditional shells, as a betrayed lover does.

Digital Transformation and Traditional Channels

After all, traditional channels have always worked, so why abandon them?

That’s exactly the point – you do NOT have to do it. Self-respecting Digital Transformation does not transform anything that is already working well. Digital Transformation only intervenes on what really needs to be optimized or on the creation of new sales and/or distribution channels and/or business process optimization.

But let’s be clear, the Digital Transformation compass must always be held by the entrepreneur or professional. It’s okay to be helped, supported, inducted. It’s not good that he/she suffers it, because it won’t change the famous and cool mindset.

The 4 phases of Digital Transformation

So really, how can we categorize a company’s digital transformation? I would say in 4 steps:

  1. Accurate analysis of the company’s history, its target market, its positioning, organizational characteristics, buyer personas, current sales and/or distribution channels;
  2. Identification of unexpressed potential, critical issues, emerging opportunities
  3. Planning of action areas with realistic RoI (return on investment) targets
  4. Execution, i.e. the realization of what was designed

In this introductory article to the topic, I made the effort to break down transformation from digital. In the next articles, I will recompose it by explaining why digital tools cannot be ignored today.

Aloha!