Do a quick search on Google, and the phrase Digital Transformation may be one of the most sought-after business terms, with over 300 million results!
For all companies, regardless of if you’re a mature or early-stage growth-oriented businesses, the pressure is on to digitize, automate and analyze like never before. McKinsey research shows that the best-performing segment of digitized companies earns as much as 80% of the digital revenues generated in their industries. Racing to the top of that elite group is far from easy. In that same McKinsey report, which interviewed over 1,700 C-suite executives, it was learned that the average digital transformation—an effort to enable existing business models by integrating advanced technologies—stands a 45% chance of delivering less profit than expected. The likelihood of surpassing profit expectations, on average, is just one in ten. Yes, there is data that proves that digital transformation efforts fail to deliver far more often than they succeed.
However, there is a silver lining: adhering to a well-defined set of transformation practices lifts the likelihood of exceeding profit expectations to more than 50%—about five times better than transformations that involve none of these practices. Read on to learn how can you leverage these best practices so that you can tackle the pros and cons of Digital Demand Transformation and exceed expectations.
What is Digital Demand Transformation?
Digital Demand Transformation is specialized around the strategic demand marketing aspect of automation within an organization. It’s part design thinking (pursuing an ‘outside-in’ architecture for marketing and sales) and it’s part closed-loop systems and connectivity (maintaining 360-degree awareness of buyers’ needs and the ability to orchestrate online and offline engagement to propel the buying process). A Digital Demand Transformation cuts through the thousands of marketing and sales technology solutions available today by providing a lens through which to evaluate and integrate these platforms and plugins into the context of a truly integrated, strategic demand stack – focused on delivering business growth in a more automated, analytical and customer centric way.
Done right, Digital Demand Transformation means aligning people, process, content, technology and data around the buyer. It’s an approach to help companies maximize the targeting, placement and ROI of demand marketing investments. And, the payoff is tremendous.
Organizations that have undergone a successful Digital Demand Transformation realize nearly 5x more sales wins in their demand funnel vs. B2B organizations that have not. But there are several pros and cons to Digital Demand Transformation, and it’s important to understand the scope before diving in.
Why Do Organizations Need Transformation?
The most pressing and common needs addressed by a Digital Demand Transformation include how to::
- Tie marketing investments to ROI and business growth
- Optimize against insights
- Leverage technology as an ingredient for scalability and efficiency within both sales and marketing functions
- Engage customers in a more personalized way – ensuring that they receive a “concierge-led” experience
- Build brand preference while connecting solutions to customer challenges
- Build scale and deliver value to the business?
Tackling the Cons: Success Takes a Plan
Addressing these challenges is not for the faint of heart. One of the biggest challenges is overcoming the belief that technology can address them all. Technology is not a strategy!
So, what are the cons of Digital Demand Transformation – and how do we overcome them?
1. Change is Hard
Overcoming the status quo with your people is perhaps the hardest part of a Digital Demand Transformation. Marketers have been operating tactically for decades and changing that mindset is not easy. Strategy alone is not enough. It’s critical to align marketing with sales, finance and business management. Together, all teams can begin to adopt a fundamentally new methodology and drive Strategic Demand Marketing. Agreeing to a new approach is a good first step, but the key is then being able to operationalize alignment around this approach.
2. Real Impact Doesn’t Happen Overnight
Digital Demand Transformation is no small undertaking. It requires serious amounts of effort and support to accomplish the long-term vision and so it’s crucial to take a phased approach. Move through phases that advance your organization’s demand marketing maturity levels while still improving performance and achieving objectives along the way. It’s important to note that, while phasing is crucial and these phases should build on one another, phases should can’t be so chopped-up that they take you back to a series of tactical programs. If they are not all building towards an outcome, they are not phases in a journey.
3. Walking in Someone Else’s Shoes is Difficult, But Essential
Take a step back before embarking on a Digital Demand Transformation. Look at your company from the buyer’s point of view. What problem is driving the prospect to your website? What solution is the buyer interested in at first? Find the answers to these types of questions and capture the buyer journey. That’s the critical first step – and the critical organizing principle – in building all elements of people, process, content, technology and data around the buyer. Begin with research, analysis, benchmarking and insight reporting, and use this to shape your content marketing strategy and your processes for lead management. Putting the buyer at the center is the most fundamental step in Digital Demand Transformation.
4. Creating a Plan Takes Time
A great old quote by Benjamin Franklin should remind us all,
“By failing to prepare, you are preparing to fail”
It can be hard to convince the organization to slow down in order to ultimately scale the business. But it’s a necessary tool for driving alignment, developing content, determining process and ultimately defining the role technology will play in enabling this plan. Your buyer insights should form the foundational blueprint that guides your Digital Demand Transformation. The elements of this blueprint should include a model for Demand Process and a Lead Management Framework. Conversation Tracks and Engagement Channels should layer in and then form the basis for a Perpetual Demand Generation program. These are the components that enable you to build this blueprint.
Embracing the Pros – Tackling 400% Growth for a SaaS Company
The stakes were high for this high-growth SaaS company. Aiming to achieve 400% growth over a three-year period, the company needed to transform its demand marketing to become the best-in-class enterprise DevOps testing providers.
Before beginning its Digital Demand Transformation, this company was stuck creating tactical demand generation campaigns that had no impact on the bottom line. Marketing kept trying to compensate, but sales was getting more and more frustrated and growth wasn’t happening fast enough.
Across the company, different business units were using different tools to compile data, with no communication between teams. One department might use Eloqua as their marketing automation system, another might use Pardot, and yet another might use Mailchimp. Needless to say, there was no end-to-end visibility and no way to optimize demand.
This company knew that, to achieve its high growth goals, it needed to change. Its Digital Demand Transformation initiative included aligning the people (by getting everyone aligned to the same goals), process (by implementing a lead management framework), content (by creating buyer-centric pieces aligned to the buying process), and technology (by standardizing the marketing tech stack) to create true transformation.
After implementation, this company recognized a 54% increase in end-to-end conversion rates and a 250% ROI on their initial spend and program build costs. Fifty percent (50%) of opportunities created in the first year were directly sourced by marketing and 54% of opportunities won in the first year were directly sourced by marketing.
The Time is NOW
The results speak for themselves and the rewards far outweigh the risk. A Digital Demand Transformation is not for the faint of heart – but it is for the champion of growth. Continuing to operate in a cycle of tactical demand generation campaigns won’t get you anywhere, but tackling the pros and cons of Digital Demand Transformation will. Read on to learn more about the Core Elements of a Digital Demand Transformation. Already know that this is what your organization needs? Let’s connect.
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