Imagine what it’s like when your usual distribution channels have fallen into ruins. Your shops or offices close down. You’re not allowed to meet your customer anymore. How would that affect your business? Would you survive?
This is exactly what happened to many businesses around the world when the COVID-19 pandemic broke out. Some of them used this highly uncomfortable circumstance to improve their business models. In a moment you will read about those who combined digital technology and people in new ways that helped them go through the crisis and become even stronger. Our consultants gathered interesting digital transformation examples and now we give it to you.
What is digital transformation?
Digital transformation is a process of changing the way your organization works, using digital technologies. This kind of transformation allows businesses to stay competitive in a changing environment and lure new clients with better service and new experience. There are at least two ways to do this.
First, you can keep the same processes but employ new, more efficient digital solutions to run the processes. For example, you start selling your products online. Or you equip your employees with new digital tools that enhance their efficiency. Second, you can create and implement new processes, new ways of delivering value to your customers, that make use of digital solutions. This way you usually introduce a completely new service and change the customer experience.
Why digital transformation is important?
The outbreak of COVID-19 proved that we live in turbulent times and an ever-changing environment. However today we do have tools to answer these changes, or even embrace them. One such tool is digital transformation.
Apart from preparing you for the challenges of the new order, it will also give your business salient business advantages. Digital transformation will help you:
- create a more flexible supply chain
- produce goods and services cost-efficiently even in countries with higher labor costs
- create more agile and adaptable solutions.
It all boosts your business‘ crisis resistance. Isn’t that what you need now?
How to benefit from digital transformation?
What is important and crucial to a successful digital transformation? Some challenges are common for any transformation, any change. You need the ‘embrace the change’ approach. Moreover, your team needs to understand why they need this change. It’s your responsibility to convince them. You should make clear, how everyone will benefit from the transformation. Without that, it will be difficult to perform such a change.
To succeed in digital transformation, you should start with a flexible mindset. At the very beginning, you won’t know what digital solutions will suit your company. It can be more effective if you find a business partner who will support your transformation. Especially, a digital-native company experienced in introducing new technologies to the market. Finally, you must educate both your employees and customers. Employees need to know how to work in a new environment, and customers need to learn what has changed, and what’s in it for them.
Successful Digital Transformation Examples
1. Company: Michael Kors
Industry: Fashion
The outbreak of COVID-19 closed the company’s brick-and-mortar shops in China. Michael Kors then moved to Tmall - a Chinese retail e-commerce marketplace and launched a completely new service. The company also decided to improve the Chinese consumers’ experience by designing a special pop‑up. It delivers a personality quiz that analyzes information about consumer’s favorite activities or food. The result is a personalized message with Michael Kors product recommendations from the brand founder. This way the company kept consumers engaged with the brand tightening the relationship and stopping the outflow of customers.
2. Company: Canadian Home Leisure
Industry: Outdoor Furniture
Canadian Home Leisure is a retail store providing all kinds of furniture for outdoor activities. Hot tubs, barbecues, tables, you name it - it’s there. Before COVID-19 their strategy was based on the traditional brick-and-mortar store visited by customers. However, when people are limited in how and where they can move, it became difficult to show them CML’s products. The company decided to offer virtual presentations to their customers. They can schedule detailed presentations of any product on stock. Moreover, the company now offers online payment and deliveries, so its customers don’t need to appear in the store. A new stream of income helped Canadian Home Leisure stay in business and develop the new customer experience.
3. Company: Ping An Bank
Industry: Banking
Ping An Bank is a Chinese bank located in Shenzhen. Like many other businesses it too encountered the problem of delivering services and ensuring a delightful customer experience during the COVID-19 pandemic. Aiming at keeping the high level of growth, Ping An Bank focused on its technological advantages built before the outbreak. As the bank developed fully online access and contactless services, it increased the number of customers by almost 12% during the first half of 2020. The bank also widened its offer for small and medium enterprises, providing them with solutions for financial management within a mobile application.
4. Company: Huanxi Media Group
Industry: Media & Entertainment
What about intangible goods like movies? We’re accustomed to movie premiers held in cinemas with snacks, sodas, and the smell of popcorn. Impossible to perform safely during a pandemic. The latest James Bond movie is the best example. However, Chinese media company Huanxi found a solution to the restrictions of this difficult time. The premiere of their movie ‘Lost in Russia’ was supposed to take place during the Chinese New Year festivities. As all the cinemas were closed, Huanxi turned to IT company Bytedance (TikTok’s owner) and together they organized a live-streamed premiere. This move led to an income of over $600m within just two days.
5. Company: Compac
Industry: Food sorting
Compac provides customers with machines for fruit sorting and maintenance. To fight the challenges of pandemic times they decided to provide customers with remote technical support. Clients received iPads with dedicated applications supporting them with instructions for repairing the machinery. Moreover, Compac delivered tailored checklists so their customers could solve common issues on their own. Thanks to that solution, technicians don’t have to visit sites in-person risking virus exposure.
6. Company: Cheeky Food Events
Industry: Corporate events
This Australian company offers team-building events organized with cooking activities. In the new post-COVID situation they had to re-engineer their business model. The new model is adjusted to the remote work. Employees taking part in an event were delivered catering with ingredients needed for two-course meal preparation. Cheeky Food then uses streaming to ensure every employee with professional assistance. As a result, companies can still hire Cheeky Food Events to organize team-building events for their employees.
7. Company: Budweiser, Carlsberg, Rémy Martin, Pernod Ricard, JD.com, Taihe Music Group
Industry: Drinks and Events
It was clear that the sales volume of beverages and liquors will drop as clubs and events were to be closed due to the COVID-19 pandemic. It was painful, especially in China. Facing this problem, beer, cognac, and drink brands connected their forces and started a collaboration with the Chinese e-commerce platform and with a music label to organize online clubbing events and provide participants with liquor delivered door-to-door.
JD.com hosts weekly DJ performances with musicians from Taihe Music Group. Customers experience live-streaming and buy drinks online, to enjoy the party-from-home. Organizers claim that sales of some brands increased even by 70% day-to-day.
8. Company: AARMY
Industry: Gym & Fitness
Gym and fitness centers are another example of an industry that was severely affected by the pandemic. Thanks to technology, gyms could stay connected to their customers and provide them with training support.
As the COVID-19 pandemic outbroke, AARMY closed its training centers in New York and Los Angeles due to safety reasons (if you're from LA you might want to check out our App Developers in Los Angeles). Fortunately, they had been planning to set up streaming sessions before the pandemic. Now the rapid change forced them to start right away. With what effect? Within the first 24 hours, more than 18,000 people attended AARMY online classes. Now compare it to 300 attendees per trainer a day, that could attend classes in person.
9. Company: King Arthur Flour
Industry: Food Production
Flour milling may seem to be an incredibly traditional business. However, it doesn’t mean such companies can’t benefit from digital transformation of some kind. King Arthur Flour is the oldest flour producer in the United States. Yet they found a way to incorporate new digital solutions into their business, as the pandemic shot down many brick-and-mortar shops responsible for delivery and sales.
The company decided to create new demand online. They created and published high-quality content involving people in home-baking activities. People who want to take part can do nothing else than buy flour from their trusted supplier - King Arthur. Results? Sales increase of 200% year-to-year.
10. Company: TOV
Industry: Furniture
TOV is an American furniture manufacturer. Until recently they would sell all their products B2B. The final customer had to buy from furniture stores or online retailers. After the COVID-19 outbreak stores were closed and customers could only shop online. It was the impulse that prompted TOV’s impulse toward e-commerce and B2C sales.
People closed at homes by the pandemic started looking for furniture for their children (e.g. outdoor trampolines) and then for desks and facilities needed for remote work. Backed by a new e-commerce platform and digital marketing tools TOV is now building its new digital distribution channel.
5 reasons why do digital transformations fail
Digital transformations fail when you do it without preparation and/or without an experienced team of specialists. Moreover, the new way your company works after the transformation must be aligned with your strategy. Any change will fail, and recent post-COVID transformations are no different if you copy someone’s else solutions. Such a thing will never work in the longer term.
What are the common reasons for the failure of digital transformation?
- Unclear goals - it’s difficult to succeed if you don’t know what you’re aiming for
- Lack of expertise - implementing a new digital model in your company requires experienced specialists
- Internal resistance - a very common pitfall in change management is the resistance of your employees
- Focusing solely on technology and ignoring Customer Experience - technology is cool, but it must give value to your customers
- Keeping the old pre-digital culture - digital transformation includes a big change in the way your organization works, and changing your organizational culture is part of it.
Positive digital transformation examples described above share common traits. They were well thought through and adjusted to the recent changes in the environment. What’s even more important, they aimed to deliver even greater value to the end customers.
I want to implement digital transformation in my company
So you want to be among those who took advantage of new opportunities that emerged after COVID-19? Mighty clever of you. Talk to our strategic consultants and business analysts to find out how we can support your digital transformation and boost the growth of your business.
