The Future Of Business Is Digital
Martin Gill, VP & Principal Analyst
May 12th, 2015

Consumers & Small Business Customers are
fundamentally digital

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Empowered customers have given rise to a new era
Age of manufacturing
Mass manufacturing
makes industrial
powerhouses
successful
• Ford
• Boeing
• GE
• RCA
Age of distribution
Global connections
and transportation
systems make
distribution key
• Wal-Mart
• Toyota
• P&G
• UPS
Age of information
Connected PCs and
supply chains mean
those that control
information flow
dominate
• Amazon
• Google
• Comcast
• Capital One
Age of the customer
Empowered buyers
demand a new level of
customer obsession
• Macy’s
• Salesforce.com
• USAA
• Amazon

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Web use is mainstream

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Source: January 29, 2014 “Introducing The Global Retail Segmentation”, Forrester report
Forrester’s retail segmentation

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Source: April 2014, “European Retail Segmentation: Emerging Patterns Of Multitouchpoint Shopping” Forrester report
Europeans Embrace Multiple Touchpoints To Shop

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Source: May 19, 2014, “The State Of Consumers And Technology: Benchmark 2013, Europe” Forrester report
Device use is ubiquitous

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Interested in connected technology grows

We face a wave of innovation.

Complexity is the new reality.

Digital competitors thrive.

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Digital competitors thrive
No industry is immune

Some brands are born digital.

Some achieve digital mastery.

While others have had digital
thrust upon them.

You must become a digital
business.

73%

34%

16%

Digital businesses continuously exploit
digital technologies to both create new
sources of value for customers and
increase operational agility in service of
customers.

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Source: April 16, 2014 “Understand The Digital Business Landscape” Forrester report
Master both sides of digital

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DigitalCustomerExperience(DCX)
Digital Operational Excellence
(DOX)
Source: September 10, 2014 “ Brief: Take The Digital Business Readiness Assessment”, Forrester report
Digital mastery eludes most firms

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DigitalCustomerExperience(DCX)
Digital Operational Excellence
(DOX)
Source: September 10, 2014 “ Brief: Take The Digital Business Readiness Assessment”, Forrester report
Don’t succumb to digital extinction
Digital Dinosaur

Don’t burry your head in the sand.

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DigitalCustomerExperience(DCX)
Digital Operational Excellence
(DOX)
Source: September 10, 2014 “ Brief: Take The Digital Business Readiness Assessment”, Forrester report
Drive digital efficiency and agility
Digital Dinosaur
Digital Connector

KLM focuses on making digital connections.

Vail resorts gameifies customer experience
with it’s EpicMix app.

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DigitalCustomerExperience(DCX)
Digital Operational Excellence
(DOX)
Source: September 10, 2014 “ Brief: Take The Digital Business Readiness Assessment”, Forrester report
Re-position yourself in the ecosystem
Digital Dinosaur
Digital Connector
Digital Operator

Rolls Royce leases “propulsion hours” to
airlines.

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Digital Dinosaur
Digital Connector
Digital Operator
Digital Master
DigitalCustomerExperience(DCX)
Digital Operational Excellence
(DOX)
Source: September 10, 2014 “ Brief: Take The Digital Business Readiness Assessment”, Forrester report
Iterate and innovate to maintain mastery

John Deere’s FarmSight technology
digitizes farming.

Digital businesses are networked.

Expedia has generate over $2bn in revenue
from affiliate APIs.

Walgreens extends its digital customer
experience.

PG&E create an innovation ecosystem.

That apps like Leafully can plug into.

So what do you do?

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There are three paths to Digital Mastery

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Burberry’s iterates towards digital mastery

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Businessstrategy
Digitalstrategy
Strategy

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Businessstrategy
Digitalstrategy
Strategy Execution

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Businessstrategy
Digitalstrategy
Culture
Organization
Technology
Metrics
Strategy Execution

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Culture Foster a culture of digital innovation

Volvo champions open innovation.

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Culture
Organization
Foster a culture of digital innovation
Organize to deliver digitally enhanced
experiences

Digital centres of excellence accelerate
change.

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Culture
Organization
Technology
Foster a culture of digital innovation
Organize to deliver digitally enhanced
experiences
Enable with technology

Design thinking in action at
eBay Inc.

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Culture
Organization
Technology
Metrics
Foster a culture of digital innovation
Organize to deliver digitally enhanced
experiences
Enable with technology
Underpin decisions with customer-centric
metrics

Virgin Media rewards employees based on
NPS scores.

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The Digital Maturity Model
Repair Elevate Optimize Differentiate
Culture
Organization
Technology
Measurement

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Source: Digital Maturity Survey 2013
Digital masters are hard to find
0% 20% 40% 60% 80% 100% 120%
Automotive
Consumer products
Financial services
Health
Technology
Media and communications
Retail and wholesale
Telecommunications
Travel
Other
Repair
Elevate
Optimize
Differentiate
Repair Elevate Optimize Differentiate

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Source: Digital Maturity Survey 2013
Digital Maturity delivers results
0% 10% 20% 30% 40% 50% 60% 70%
No impact
We have not implemented a multi-touchpoint digital strategy
Increased operating costs
Increased employee morale
Increased offline sales
Increased call center volume
Decreased operating costs
Satisfaction or similar metrics
Increased profitability
Increased online sales
What impact has the implementation of a multi-touchpoint digital strategy had on your company?
Differentiate
Repair

Digital business transformation is a
journey, not a destination.

Thank you
forrester.com
Martin Gill
+44 (0)20.7323.7734
mgill@forrester.com
@martinjohngill