Digital Engagement
In an uncertain economic environment, companies face tough choices regarding their digital customer experience investments, despite strong consumer sentiment.
I will be connecting with Michael McLaren, President, North America at Bounteous, to discuss how companies can deliver innovative customer experiences in uncertain times.
Michael is a digital leader with over 30 years of experience in growing digital agencies and empowering companies. His focus is building businesses, embracing technology innovation, and empowering great people. He’s been with Bounteous in a leadership role for one year. Michael previously served as CEO of Merkle B2B and CEO of MRM//McCann.
Gary Drenik: Michael, How are businesses meeting the speed of the customer in our new digital economy?
Michael McLaren: It’s an uncertain economic time and companies are rightfully cautious. We are seeing businesses choosing two paths forward: optimization and innovation. The temptation in economic uncertainty is for businesses to optimize what they are already doing. When businesses choose optimization, they might be pausing investments in digital transformation to drive down costs, taking staffing actions, or they’re working to identify budget-savings in specific digital marketing channels (like search, social, programmatic media, and so-on).
Businesses that choose cost optimization face a major risk that customers, demanding faster, easier, more convenient digital experiences, will simply move on. It’s no secret that Millennials and Gen-Z are getting more influential and more digitally savvy every day. Buying habits are rapidly changing. According to a recent Prosper Insights & Analytics survey, Gen-Z and Millennial responders were twice as likely to regularly use social commerce shopping features on social networks like Instagram (30%, 31% vs 17%), Tik-Tok (30%, 29% vs 15%) & Pinterest (19%, 20% vs 11%) when compared with Gen-X. That’s just a quick example of changing consumer behaviors.
Prosper - Shop Now On Social Media Platforms
We see other businesses doubling down on digital innovation efforts, like creating a targeted personalization or loyalty program, developing a real-time recommendation program, or embracing social commerce or omnichannel marketing. Bounteous strongly feels that investments in building rich customer engagement is the path to growth and we’re partnering with some of the world’s most ambitious brands to create these transformative digital experiences. When technology investments and data orchestration come together, there’s an opportunity to unlock digital flow.
Drenik: Companies have invested in digital transformation for many years now. What is Digital Flow and how is it elevating those investments?
McLaren: Digital Flow is a term we use to describe the high-velocity capabilities that companies need to compete and win in today's digital economy. Digital flow enables companies to generate insights continuously from data produced by their digital experiences, and then apply these insights to create new, more personalized, and effective digital experiences. Building this capability is a key catalyst and enabler for achieving category leadership. Companies need long-term strategic partners to enhance their data, tech, talent, and methods to achieve digital flow. You can’t outsource this and it’s really hard for businesses to develop on their own. Bounteous recently commissioned a study with Forrester that surveyed leading executives to study the impact of Digital Flow and of Co-Innovation principles at adopting companies. We found that leading companies achieving high-velocity digital flow capabilities were twice as likely to realize double-digit growth, compared with less digitally mature businesses (44% vs 22%).
I just spoke at a conference with leadership from Shake Shack. Their story really crystallizes the idea of digital flow. Shake Shack’s focus is on world class guest hospitality. They create endless innovations for in-store experiences like new menu items, new flavors, collaborative partnerships, and more. Shake Shack was dissatisfied with traditional restaurant tech solutions, ordering platform vendors, and third-party tools, so they partnered with Bounteous to build and deploy their own tech and reach a digital flow state. Now they can recreate their unparalleled in-store guest experience through omnichannel digital platforms, learn from customer data, and improve over and over again. Digital orders are nearing 50 percent of total sales. Last year in Q3, Shake Shack’s digital guests spent, on average, 20 percent more per visit than non-digital users. Shake Shack is creating tremendous value by offering their customers more ways to order and engage with their brand.
Drenik: What do companies need to achieve digital flow? How does it tie to growth?
McLaren: The first thing is that business must understand that achieving these capabilities is not done through a single technology project, a platform migration, or a piecemeal approach. It takes an organizational commitment to innovation.
The second thing businesses should be seeking is a robust assessment of their current capability state in order to develop the roadmap going forward. Bounteous recommends assessing the following five areas: Talent & Culture Readiness, Tech Maturity, Methods & Best Practices, Data & Insights, and Brand Experience Excellence. Each capability can be scored in a diagnostic model. All categories fit together to deliver high value and high velocity customer experiences. It’s certainly true that every organization has unique digital maturity strengths and deficits. When companies understand current state capabilities and understand where their customers are going, they can build and deploy CX experiences that exceed customer expectations.
Drenik: How are budget-conscious companies approaching this in 2023?
McLaren: Leading companies are realizing that developing the right digital innovation capabilities can ultimately lead to greater customer satisfaction and also cost savings. It’s important to remember that the customer is not slowing down. In this environment, bold companies will come out ahead; so, businesses should prioritize their technology investments and focus on the one thing out of ten that they need to do to move the growth needle.
We see businesses recognizing cost savings through vendor or technology consolidation and optimizing run rates, cloud fees, or media programs as a result. Organizations are getting smarter and realizing that tech band-aids alone won’t get them to their north star goal.
Our top client partners seek outcome-based partnership agreements where all partners have skin in the game, blended team structures with flexible roles, and vendor consolidation through larger technology partnerships. We truly believe that path creates growth.
Drenik: So digital flow enables personalization, omnichannel commerce, and other proactive marketing moments. Are there other benefits?
McLaren: Our research shows that beyond revenue growth, companies that develop digital flow capabilities create not just happier customers through metrics like improved CSAT scores, but happier employees as well. When empowered by the right data, tech, methods, and talent, team members turn insights into actions and get closer to their customers.
Drenik: Michael, thanks so much for sharing your insights on how businesses can foster digital innovation in an uncertain economy.
