More Thoughts on Digital Strategy

While reflecting on recent dialog with executives, I’ve realized that although the growth of digital represents opportunity, the speed at which we are reacting could actually be working against us. Technology advancements and their broad consumer adoption are driving initiatives in isolation. We see tremendous opportunity in riding the social media, location and mobility waves, but when pursued in isolation, there could be unintended consequences. For example, several companies have been noted for their social media prowess, but the possible side effects of this prowess are reflected in some key statistics:

  • Coca Cola’s website traffic is down more than 40% in just 12 months
  • Nabisco’s traffic has dropped nearly 74% in just one year
  • The average decrease in unique visitors for Fortune 100 websites is 24%

As a result, there’s a renewed and holistic focus on digital strategy. The resulting strategies must consider the direction that these waves are moving. I’ll take a futuristic look at the social and analytics components of a digital strategy. 

Businesses expand their social media footprint

As discussed here several times, 2010 was the year that companies saw social media as more than just a passing fad. In 2011, we already see an increased focus on:

  • FaceBook
  • Twitter
  • YouTube
  • LinkedIn
  • Blogs
  • Other

 Social Media expands beyond brand awareness and marketing

Companies will come to realize that social computing delivers business benefit beyond brand recognition. Metrics are starting to prove this out:

  • Forty-four percent of companies have acquired a customer from FaceBook
  • Levi’s saw and maintained a 40 times increase in FaceBook referral traffic after implementing the Like button
  • Retailer saw 100% revenue increase within two weeks of adding the Like button
  • American Eagle added the Like button next to every product on their site and found FaceBook referred visitors spent an average of 57% more money than non-FaceBook referred visitors
  • Dell generated over $3.0 million in sales from Twitter alone
  • Comcast has helped over 150,000 customers through their Twitter account
  • Forty-one percent of companies have acquired a customer from Twitter

As business value is better understood, social capabilities are absorbed into existing processes and buzzwords like Social CRM and Enterprise 2.0 disappear. At the end of the day, companies become social businesses where social computing is an integral part of business process. They will integrate and optimize all their digital assets as part of a well defined holistic digital strategy. Social media, mobile channels and the corporate website will each play a defined role, optimized to deliver the intended business outcomes. Socially-enabled business processes will include:  customer service, Product Development, Sales, Marketing, Risk Management, Human Resources and Finance. Social business will invite all stakeholders (employees, customers, partners, communities, and others) into our business processes. 

With all this as a backdrop, I expect to see companies embark on several key initiatives:

  • Social measurement
  • Social lead generation
  • Social selling
  • Servicing customers through social channels
  • Social channels for direct communication
  • Automated analytic and response mechanisms
  • Social search engine optimization
  • Socially-enabling corporate intranets
  • Socially-enabling corporate websites
  • Crowd sourcing and idea management
  • Internal social communication
  • Internal social collaboration
  • Internal communities of interest
  • Branded customer communities
  • Private partner communities
  • Collective intelligence

Decision management

As advanced analytics technology matures, there is a greater focus on decision management. The end state is an analytical culture that is prescriptive in nature and aimed at enabling the right business outcomes. I like to use the IBM Watson Jeopardy challenge as an example of what I mean here. For those who watched, you saw Watson come up with four or five possible answers that were ranked by percent confidence. Watson always presented the answer with the highest degree of confidence – and it did so in real time. If we view this from a business context, the same approach applies. How do we use analytics to identify four or five actions that can enable a specific business outcome? How do we optimize that outcome by scoring these actions and pursuing that action with the best chance of delivering the intended outcome? Advanced analytics is moving in this direction. 

On the social front, social listening will mature into a deeper form of analytics. As this occurs, listening and text analytic platforms will be absorbed into business applications. I envision the pursuit of several key decision management initiatives driven by social data:

  • Web analytics tracks social interaction
  • Social data as a valued source of insight
  • Social profiles support decision processes
  • Social data improves analytic accuracy
  • Forward looking analysis based on social data
  • Risk monitoring
  • Integrating social and customer data
  • Integrating social and operational data 

Mobility and location-based services add another dimension to our digital strategy, which I will address in a future post. For now, I believe companies should renew there pursuit of digital strategy with a broad perspective on the future of social computing and analytics to ensure optimal results.

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