TMW #027 | The state of global digital transformation, Amazon’s legacy and creator monetisation.
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✍ Commentary
🏦 The global state of digital transformation - It’s not pretty. Digital transformations come in many shapes and sizes, but one thing over 70% of them have in common is they are increasingly ineffective in creating value for brands. That’s the perspective of the Boston Consulting Group, who presented a report at the World Economic Forum last week. The research came from a survey of over 78 leading companies and 800 + executives on the approaches and mindsets on digital transformation. While only 30% of brands derive real value out of their technology investments, the adoption of transformative projects is still accelerating. Are brands investing in transformation because everyone else is? Or is there real purpose and an understanding of value that motivate company leaders to transform?
The notion of a transformation is itself a misnomer. Brands are always transforming, and the concept really is shorthand for “responding to disruption with tech investment, and a whole lot of consultants.” Today, every company is a technology company - and the 80% who are not seeing value are yet to grapple with this concept. BCG talks about six areas where brands can improve, but I only want to talk about two of them. First, the fact that 50% of surveyed companies really struggled with a lack of flexibility in their technology and data platforms is telling. Most brands that have not invested in technology early are hard up against a wall of old school, siloed systems which can be a significant time, resource and funding suck out of their business. The second point also reinforces the first, which is the recommendation that agile governance should be able to broaden the adoption of technology, which points squarely in the direction of most brands trying to implement technology, but not thinking or working like technologists. There have been quite a few high profile transformation failures in the past couple of years particularly when it comes to larger consulting organisations coming into the picture. Recently the US digital platform to manage the COVID-19 vaccine has come under intense scrutiny, as $44 million dollars later, the platform is still not working as it was intended and has been abandoned by some US states. This was a joint project with a large US consultancy, which highlights that true software implementations should not be outsourced but enhanced by expert consultants. This is just another example of organisations not rising to the challenge of building world class software. Tech companies are organised in specific ways so they can focus on building technology, when brands can see they have a software business living inside them and organise themselves and their investments accordingly, the better. BCG Report. WEC Release.
📦 Amazon’s legacy - Imagination and consistency. You’ve probably heard that Amazon CEO Jeff Bezos is passing the baton to the AWS chief Andy Jassy. This has triggered countless reflection pieces about the success of Jeff Bezos’ leadership and his singular focus on harnessing technology which has propelled his personal wealth and the market cap of Amazon to astronomical proportions. I did a little digging myself and found this curious little quote from 1997, Jeff’s first shareholder letter:
"But this is Day 1 for the Internet and, if we execute well, for Amazon.com. Today, online commerce saves customers money and precious time. Tomorrow, through personalization, online commerce will accelerate the very process of discovery.Amazon.com uses the Internet to create real value for its customers and, by doing so, hopes to create an enduring franchise, even in established and large markets."
Now what’s striking here is Jeff’s big bet on personalisation and the imagination to see that internet commerce will indeed be the market they could dominate. But also his “day 1” mantra, which, if you talk to any Amazon employee will probably give you a spiel. It’s this partnership between seeing the things that customers would want one day, and the solidarity, consistency and focus of the vision to actually pull those things off that has led to Amazon’s success. While some suggest Amazon’s success comes from the focus on the customer (and I agree that’s true) it also can be deceptive. Customer obsession is often interpreted as focusing on data to understand customers and act on their needs, but what Amazon really pioneered was the ability to see through and beyond the data to deploy technology in ways that no one saw coming. While it’s true Amazon knows their customers today, they are also really good at knowing their customer tomorrow or a decade from now. Link. Shareholder letters.
📈Chart Of The Week
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📰 Latest Developments
Google launches News Showcase. This is part of Google’s strategy in Australia to offer an alternative solution to the news media bargaining code. The solution is to ask publications to host their content on the Google platform as a form of monetisation. They might as well ask for news publications for the shirts off their backs too. Link
Hubspot buys The Hustle for $28 million. This is like pancakes and maple syrup. Both companies have a very aligned market, strong content marketing function and the ability to scale other startups. A nice story of market alignment between both brands. Link
The CDP Unicorn. Tealium, a leader in CDP and tag management solutions has just raised their series G, valuing the business at $1.2 Billion. Aside from innovating in the data space, a lot of this has to do with the company’s unique focus on training and upskilling the companies they sell to, compounding customers satisfaction and boosting the brand ahead of competitors. Link
📚 Reading
Natural language processing - the next best analytics opportunity. A great piece on the advances of natural language processing driven by the latest increases in compute power. This is something to watch as CX professionals are likely to rely more on NLP to manage customer service interactions at scale. Link
Why hasn’t Twitter grown in 10 years? The company’s share price has only grown 1.9% year on year for 10 years. The social media company’s tomorrow at some point should come today. Some interesting thinking on where the platform could go. There’s certainty going to be subscription products involved. Link
Data creepiness and brand risk. The concept of consumers being a little unnerved by the data a brand may know about them used to belong on the fringes of customer experience. But now, thanks to social media it’s become a big issue for many brands, and is a serious reputational risk. Link
🔢 Data & Insights
National data breach report. An Australian government study into data breaches across industries and business profiles. Healthcare ranks the highest in data security issues, mostly because it’s one of the least sophisticated industries when it comes to digital technology. I smell opportunity. Link
Gartner magic quadrant for DXP. DXP stands for “digital experience platform” which is platform technology combining data analytics, executional and optimisation features. Adobe comes out on top and Episerver (Optimizely) is making fast progress. Link
The 50 most visited websites in the world. Some surprises in her and sites I’ve never heard of. Link
💡 Ideas
An MBA for SEO. This is a wide spectrum discipline, and one where the inferior SEOs tarnish the reputations of the respectable and accomplished. I course on SEO that should set people in the practice apart. Link
Data visualisation for strategists. A really nice guide on creating data visualisation from a strategist's perspective. Link
Amazon Go 2.0. A grocery cart that acts like your ecommerce cart. The next phase in the meshing between physical and digital. Some people call it “phygital” but remember, it didn’t come from me. Link
✨ Weird and Wonderful
Listen to your favourite forest. Someone thoughtful decided to create an entire library of forest recordings from around the world. Perfect for a post campaign wind down. Link
Regulating influencers? Surely most people know now that influencer posts are just advertising for their own brand or someone else's. Apparently not. Link
Spinach is disrupting marketing automation. In a very funny article that went viral this week, scientists have discovered a way for Spinach to send emails. It’s actually quite a novel innovation. Link
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Want to share something interesting or be featured in The Martech Weekly? Drop me a line at juan@themartechweekly.com.