I have had the opportunity to talk about digital strategy with a lot of interesting people lately and I find that the common theme is that most think that digital marketing is digital strategy. My view is that they are not the same.
Yes, it's true that customer-facing technology and marketing campaigns run on social platforms are visible and potentially key parts of a digital strategy. I also think that a CMO and CIO working closely together can execute a great marketing strategy. But on their own, they can't execute a digital strategy, and they miss the true opportunity.
A digital strategy requires aligning the company's resources to delight their digital and traditional consumers across multiple channels and platforms. It has front-of-house and back-of-house implications. It is almost certainly disruptive to the company and needs to be led by the CEO in cooperation with the company's leadership. It also must be integral to the corporate strategy. The change will be transformational and will need to be managed by the entire C-Suite. Here are some key stakeholders:
Operations -- Digital consumers do not have the same service and satisfaction expectations as traditional consumers. The COO's team will need to navigate significant change management as people and operational processes are redesigned to delight the digital consumer. Operations can also use consumer data to inform product development decisions.
Finance -- Sure, Finance controls the pursestrings, but beyond that, the CFO's team is interested in ensuring the success of the digital efforts. I have been fortunate enough to visit with many CFOs recently and they mostly understand the fact that digital implies a need to be agile; that ROI is uncertain; that significant IT investments may be short-term or "throwaway." They do want to understand how success in the future is measured in financial or non-financial terms. This team may also be responsible for managing risk introduced through non-traditional payment systems.
Information Technology -- The CIO's team may bear the brunt of executing a digital marketing campaign and perhaps they have the resources needed to be successful. However, most companies have legacy IT infrastructure to consider. They may be able to write interfaces for "today's hot app," but this isn't feasible as more and more apps and interfaces will be required. The corporate win in IT is first fixing the legacy problems either through APIs or an enterprise service bus, then making granular data available in near real time across all systems and to all stakeholders. Short term, these solutions are more expensive, but long term, dramatically improve an enterprise's ability to be agile.
Supply Chain -- A digital strategy opens up new avenues in the procurement process and the CSCO's team can use data to optimize inventories and appropriately share with vendor partners. I know there is extreme interest from manufacturers in getting better data on what consumers like and I believe they are willing to pay for it, opening up a new revenue stream.
Risk Management -- Even without a strategy, new technology introduces questions of privacy, data security, liability and maybe even workers' compensation. The CRMO's team can proactively protect the company against these risks.
Strategy -- The agility digital strategy requires means strategists must change as well. Instead of preserving an existing culture, CSOs will need to help lead the company through significant change management. As has been covered in hundreds of "culture eats strategy" articles, this difficulty can't be underestimated. But it's true now more than ever that "what got us here, isn't going to get us there."
Marketing -- I don't list marketing last to be disrespectful, as it's quite possible that the CMO would be responsible for a digital strategy effort. However, there's a significant difference between traditional marketing and digital marketing. The job description is shifting from creative to data centric. The CMO's team needs to master the obvious aspects of social marketing and apps, but they also need to learn how to use the enterprise infrastructure to delight consumers with multi-channel marketing and commerce, as well as micro-marketing and "surprise & delight" loyalty programs.
I haven't mentioned other stakeholders, such as Human Resources and Sales, but it's clear that they also own key pieces of the digital strategy.
Agencies and Marketing Consultants have a huge opportunity here by looking beyond the campaign and their existing relationship with the CMO and into what's really driving the company. If they don't have the expertise to help with the significant change management requirements, I suggest they could outsource that skill and maintain the client relationship.
Companies interested in resolving these issues could create a position and hire an expert to lead them through creating and deploying a digital strategy. I have found only the most forward thinking companies ready to commit at that level. Alternatively, there are a handful of consultancies that I would recommend who would able to lead enterprises through this process.
I would be interested to hear your comments!
Rick Bollar is a digital strategy executive with experience in hospitality, lodging, healthcare, education, and global facilities management. Specializes in delighting digital consumers by delivering innovative experiences in areas such as mobile commerce, local commerce, payments, nutrition, social media, micromarketing and customer loyalty. Engineers processes to allow enterprise systems and human assets to successfully execute a digital strategy. Brings a quantitative approach to digital marketing, ensuring digital, e-commerce and social initiatives have a measurable ROI. Background includes financial leadership, technology deployment, and enterprise-wide reengineering accomplishments.