Will your business be a digital predator or prey?

Digital strategies are failing because companies are bolting them on to the business, says Forrester’s Nigel Fenwick

Forrester's Fenwick: Digital businesses view technology as an investment that drives growth, not just keep costs down.
Forrester's Fenwick: Digital businesses view technology as an investment that drives growth, not just keep costs down.

Organisations that don’t make the transition to digital in the next 10 years will either be acquired by firms that have, or go out of business as new technologies transform the way companies interact with their customers.

This is the view of Nigel Fenwick, vice-president and principal analyst, Forrester Research, who was speaking last week at the CMO – CIO Customer Experience breakfast forum hosted by CMO and CIO magazines and the Association for Data-driven Marketing and Advertising (ADMA).

Fenwick said companies have a choice: They can choose to become ‘digital predators’ or end up as ‘digital prey’.

Digital strategies today are failing because organisations are thinking about them as a ‘bolt-on’ to the business, and there is a ‘disconnect’ between the potential for digital and ‘what we are actually delivering,’ he said.

He used the analogy of buying your first car; you want a sports car but buy an ‘old banger’ that you can afford, pimping it with a spoiler and mag wheels.

“We are doing the same thing with our businesses – we don’t want to change the business fundamentally but we want to add digital to it so we are trying to layer digital like a veneer on top,” he said. “If we add a mobile app, we think are now a digital company. Yet we haven’t really changed how we are delivering value to our customers and that’s fundamentally the problem.”

According to Forrester’s research, <i>The Future of Business is Digital</i>, 73 per cent of organisations have a digital strategy but people remain confused about what it means.

“For some people, digital strategy means ‘we’ve got a website’ or ‘we’ve got e-commerce’. There’s people who say it’s all about social media and engagement, while other say it’s about how you engage with employees and get them to collaborate better,” Fenwick said. “The truth is it’s all of these things and much more.”

According to Fenwick, only 21 per cent of executives believe CEOs have demonstrated a clear vision for digitising their businesses, and just 21 per cent say they have the right people in their company to create a digital business strategy. Further, 68 per cent believe functional areas of the business that have been scaled up over time to deliver output, which impedes the creation of digital strategy.

Read more: Google, not Facebook, will lead the affinity brand advertising race, Forrester claims

Digital versus traditional

To become a digital organisation, Fenwick said businesses must focus on cross-functional agility, allowing the organisation to move at the speed of the market while breaking down the barriers that get in the way of applying digital technologies.

From a technology perspective, a traditional business is more focused on keeping costs down, the lights on, and users safe, he continued. “That’s the mantra that has been given to CIOs for years,” he said. In contrast, digital businesses look at technology as an investment that drives growth. “For a digital business, technology is a means to drive the agility and innovation that they need to bring to the market,” Fenwick said.

“It’s a fundamental different mindset and it has to start at the top – at the CEO level.”

Read more: Majority of consumers trust brand recommendations from friends

Fenwick also talked about companies using digital technologies to create an “ecosystem of value” using British Airways (BA) as an example. The airline started experimenting with placing RFID tags inside customers’ luggage labels to prevent luggage losses.

"The airline realised it could take the data from those luggage labels and embed it into the customer's app on their mobile phone. So now the customer who is flying with BA has information about their bags,” Fenwick explained.

"If you're a frequent flyer, which carrier are you going to go with: One that adds value in your ecosystem to say that your bag is actually [on the aircraft,] or one where you are still left guessing?"

Check out the pictorial highlights from the 'Engineering the new customer experience' event held by CMO, CIO and ADMA in Sydney on 22 May.

Follow CMO on Twitter: @CMOAustralia, take part in the CMO Australia conversation on LinkedIn: CMO Australia, or join us on Facebook: https://www.facebook.com/CMOAustralia

Signup to CMO’s new email newsletter to receive your weekly dose of targeted content for the modern marketing chief.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments

Latest Videos

Conversations over a cuppa with CMO: Microsoft's Pip Arthur

​In this latest episode of our conversations over a cuppa with CMO, we catch up with the delightful Pip Arthur, Microsoft Australia's chief marketing officer and communications director, to talk about thinking differently, delivering on B2B connection in the crisis, brand purpose and marketing transformation.

More Videos

JP54,D2, D6, JetA1 EN590Dear Buyer/ Buyer mandate,We currently have Available FOB Rotterdam/Houston for JP54,D2, D6,JetA1 with good and w...

Collins Johnson

Oath to fully acquire Yahoo7 from Seven West Media

Read more

Great content and well explained. Everything you need to know about Digital Design, this article has got you covered. You may also check ...

Ryota Miyagi

Why the art of human-centred design has become a vital CX tool

Read more

Interested in virtual events? If you are looking for an amazing virtual booth, this is definitely worth checking https://virtualbooth.ad...

Cecille Pabon

Report: Covid effect sees digital events on the rise long-term

Read more

Thank you so much for sharing such an informative article. It’s really impressive.Click Here &amp; Create Status and share with family

Sanwataram

Predictions: 14 digital marketing predictions for 2021

Read more

Nice!https://www.live-radio-onli...

OmiljeniRadio RadioStanice Uzi

Google+ and Blogger cozy up with new comment system

Read more

Blog Posts

A Brand for social justice

In 2020, brands did something they’d never done before: They spoke up about race.

Dipanjan Chatterjee and Xiaofeng Wang

VP and principal analyst and senior analyst, Forrester

Determining our Humanity

‘Business as unusual’ is a term my organisation has adopted to describe the professional aftermath of COVID-19 and the rest of the tragic events this year. Social distancing, perspex screens at counters and masks in all manner of situations have introduced us to a world we were never familiar with. But, as we keep being reminded, this is the new normal. This is the world we created. Yet we also have the opportunity to create something else.

Katja Forbes

Managing director of Designit, Australia and New Zealand

Should your business go back to the future?

In times of uncertainty, people gravitate towards the familiar. How can businesses capitalise on this to overcome the recessionary conditions brought on by COVID? Craig Flanders explains.

Craig Flanders

CEO, Spinach

Sign in