Companies undergo a digital transformation for various reasons, often with goals of streamlining operations, being more efficient, increasing productivity, and modernizing technologies.
However, while these are the initiatives businesses focus on when starting digital transformation, the primary driver behind them is often the customer and improving the customer experience.
In this blog, we’ll explain what digital transformation entails and how it can be used to enhance the customer experience.
#What is customer experience?
Customer experience refers to customers' perception of a business as they interact with it throughout the buyer’s journey. The customer experience is end-to-end, including every touchpoint and interaction between the customer and the business, from the initial awareness and consideration stage to completing a transaction and the support they receive afterward.
The most successful businesses strive to prioritize their customers, and with good reason, too, given that companies focusing on the customer experience can see up to an 80% increase in revenue. As a result, enhancing the customer experience becomes a key driver of digital transformation initiatives.
#What is digital transformation?
Digital transformation refers to integrating modern technologies into business processes to increase business value and operational efficiency and improve the customer experience. Digital transformation is often interpreted differently from organization to organization. Still, the fundamental concept involves moving from legacy tools and technologies to modern capabilities that can drive the business forward.
For example, looking at digital transformation from the perspective of the CMS industry requires businesses to migrate from legacy systems and traditional web CMSs to adopt headless CMSs that enable them to build digital experience platforms and other composable solutions instead.
Spending on digital transformation initiatives is expected to reach $3.4 trillion by 2026 as companies attempt to meet changing customer expectations and remain competitive.
However, organizations planning or undergoing digital transformation should be aware that it will be an ongoing process as new technologies emerge daily, from virtual reality and the Internet of Things to further advancements in artificial intelligence. As such, these businesses must position themselves to continually adapt to new technologies and modernize the business year after year.
#Why digital transformation
Digital transformation has become more than a nice thing for businesses of all sizes. To keep up with changing customer expectations and the rate of innovation, digital transformation is now necessary for every company.
Companies need to digitally transform because of the ever-increasing advancements in technology. The introduction of artificial intelligence and before that cloud computing has fundamentally changed how many businesses operate and what they can achieve.
Additionally, technology has made it possible for people to interact with each other at any time through social media and instant messaging apps. This always-on availability made possible through innovation has raised the bar regarding customer expectations.
Changing customer behavior and expectations
The modern consumer has more options than ever before. Over 50% of customers would switch to a competitor after one bad experience. If one company isn’t providing them with the customer experience they want, they can easily switch to competitors without remorse.
However, they are also willing to work with companies to help them deliver a high-quality experience. For instance, consumers are eager to provide personal data to companies if they can receive a personalized experience in return. Digital transformation can give companies the capabilities they need to adequately respond to those changes in behavior and expectations before customers opt for something else.
Adaptability and survival
As technology advances and customer expectations rise, the reality is that businesses need to digitally transform as a means of survival. Leveraging modern tools and resources gives companies the adaptability they need to react to and even predict, to an extent, changes in consumer behavior or economic uncertainty.
This ability to pivot when required is a necessity that modern businesses have had to show since the beginning of the decade and will continue to be necessary in the future.
#Digital transformation benefits
Although digital transformation has become a necessity, companies can also derive several benefits from it when they begin the process early.
Improved efficiency: Digital transformation can be used to automate internal processes, streamline operations, and reduce manual errors. These changes can improve productivity, which leads to a more efficient business.
Improved customer experience: Arguably, the main benefit of digital transformation is its impact on the customer experience. A digital transformation enables businesses to deliver seamless digital experiences that span multiple channels customers expect. They can also tie in always-on availability and swift customer service to handle any issues customers may run into.
Competitive advantage: The modern technologies businesses can leverage after a digital transformation can help provide a competitive advantage. Companies will have the flexibility and adaptability to anticipate customer needs and respond faster than their competitors.
Cost savings: Streamlining operations and automating manual processes are just a few ways digital transformation can help businesses optimize and reduce costs.
Security enhancements: Modern technologies can enhance organizations’ security capabilities. This is another benefit of digital transformation, as businesses can integrate security measures such as multifactor authentication, roles and permissions, and other features that improve security.
Increased agility: Digital transformation allows companies to quickly adapt to new technologies, changes in customer preferences, and more. Whereas a legacy system might leave businesses vulnerable to changes, digital transformation provides the flexibility required.
#What does digital information mean to customer experience?
Improving the customer experience is often the leading factor in why companies attempt a digital transformation.
As Salesforce Chairman and Co-CEO Marc Benioff once said, “every digital transformation is going to begin and end with the customer, and I can see that in the minds of every CEO I talk to.” The customer takes center stage during digital transformation as significant customer-focused benefits can be achieved.
Customers expect a personalized experience from their favorite brands. With an effective digital transformation, it is possible to achieve hyper-personalization to create a granular and highly personalized customer experience that leverages real-time data, not just customer preferences.
5 ways to excel in customer experience personalization
To create a hyper-personalized customer experience, businesses should follow these best practices.
Ensure the company vision and business objectives are customer-focused
Create detailed custom profiles to have a complete understanding of the target audience
Build a customer-obsessed culture within the organization that arms everyone with the right data
Incorporate customer feedback into the customer experience
Adopt the right technologies to build a personalized customer experience, including headless CMS, a personalization engine, modern business intelligence and analytics tools, and others.
Omnichannel content delivery
The modern customer journey isn’t confined to a single channel. Therefore, companies can’t provide content on only one channel and expect customers to respond to them. Instead, they need to offer omnichannel content delivery.
By taking an omnichannel approach, companies can deliver content to customers on multiple channels and build a seamless, cohesive experience that connects these channels. This enables customers to move from one channel to the next without suffering a dip in quality or feeling like they’ve moved to a different brand.
The digital transformation that involves adding a headless CMS can enable an omnichannel strategy that connects customers across multiple touchpoints.
Data-enabled customer insights
Digital transformation and adopting modern tools enable enterprises to leverage data collected from various touchpoints to drive customer insights and make changes to marketing strategies. With better data, companies can deliver exactly what customers want when they want it.
First-party data will become pivotal to every enterprise in the upcoming cookieless world. Brands will be able to get more insights from customers if they are willing to stay longer on their own platforms instead of 3rd party platforms. Having the flexibility to use that data accordingly will only be possible through digital transformation.
Customers have grown accustomed to having everything available at their fingertips whenever they want it. Services like Netflix and various social media platforms have raised customers’ expectations for every brand.
Through digital transformation, it is possible to meet those expectations and provide the always-on availability and support customers expect, whether via chatbots or other self-service tools.
#How does technology enable digital transformation?
Innovative enterprise technologies enable businesses to achieve digital transformation. Cloud-based systems and microservices & APIs, to business intelligence solutions, headless CMSs and agile technologies
Moving to the cloud instead of relying on on-premises systems can provide enterprises with better scalability and resource management. Employees can access data and applications from anywhere and increase productivity.
Microservices & APIs
Adopting software applications that leverage a microservices architecture provides added flexibility to enable digital transformation. By connecting various services using APIs, teams can achieve more interoperability between applications, share data, and faster market time.
Business intelligence solutions
Using business intelligence software, companies can turn raw data into actionable insights they can leverage to speed up digital transformation and enhance the customer experience. Customer behavior and market trends can be quickly analyzed and used to provide personalized experiences that keep customers engaged.
A headless CMS enables companies to deliver content to multiple channels. Unlike the limitations of a traditional CMS, businesses can integrate with other systems, achieve omnichannel content delivery, and provide a better customer experience.
Additionally, companies can future-proof their content by quickly adapting to emerging technologies and platforms. It also ensures collaboration between developers and marketers and enables businesses to scale horizontally, allowing them to handle increased traffic without compromising performance.
Agile & DevOps systems
Agile methodologies and DevOps practices emphasize iterative development and continuous integration. This results in shorter development cycles, allowing businesses to release new features and updates more frequently and meet evolving customer needs.
#5 examples of how digital transformation can improve customer experience
Digital transformation improves the customer experience when it’s successful. Below are examples of brands that underwent a digital transformation and modernized their technology to provide customers with a better experience.
Increasing sales with a high-performance website
Lick is an eCommerce website specializing in home decor. The brand sought more flexibility and scalability to handle the increase in traffic as consumers rapidly adopted eCommerce, a key need for digital transformation.
Lick uses Hygraph to manage its product inventory and build the frontend of its eCommerce website. With a modular approach, they can speed up time to market using flexible content models and localize content for audiences across the EU.
Engaging customers with a composable customer portal
Samsung Electronics Germany needed a modern customer portal to keep customers engaged across multiple channels. Samsung.de built a composable members platform with Hygraph to replace the portal that was previously only available on mobile.
One of the most important benefits was the ability to engage with more customers, as people who bought non-mobile products can also enjoy customer-exclusive offers via the members portal web app. This would also allow Samsung to acquire first-party data to continue delivering their customers' desired experience.
Increasing speed to market with a market intelligence platform
Biotechnical knowledge portal BioCentury needed to revamp its website to deliver a better user experience. To achieve this, BioCentury migrated to Hygraph headless CMS. The new website is a market intelligence platform that helps biotech leaders gain the latest industry knowledge.
With Hygraph, BioCentury can deliver time-sensitive content quickly and accurately across different touchpoints. This omnichannel content delivery is a key factor in a high-quality customer experience made possible by digital transformation.
Streamlining content updates with a business resource center
Password manager company Dashlane needed to provide a variety of content to their users. However, their previous static website restricted their ability to do that and limited the productivity of both developers and marketers.
After a digital transformation, Dashlane solved their productivity problem. They built their business resource center with Hygraph, allowing customers to understand what Dashlane is about and educate themselves about cybersecurity.
The marketing team accomplished more tasks and created new campaigns without needing developer assistance, which led to an improved user experience. With an enhanced user experience, they could demonstrate the value of Dashlane across use cases.
Drawing customer insights for a media platform
Multinational telecommunications company Telenor had created a video streaming service where users could stream content from several local television stations. However, they underwent a digital transformation to modernize that streaming service to scale as the company grew.
Telenor used Hygraph to fetch metadata from external APIs accompanying the streaming videos. With the new streaming service, they could achieve a faster time to market so that customers can enjoy video content sooner.
Companies undergo digital transformation for a variety of reasons. However, the primary benefit can be seen in the customer experience. Accomplishing a digital transformation requires businesses to improve their operations and innovate using modern technologies.
Hygraph is a modern headless CMS and federated content platform that can help companies improve their digital experience. Hygraph offers enterprises the tools to transform their business operations, from delivering content to multiple channels to federating data from multiple sources.
Learn more about how Hygraph can improve the customer experience through digital transformation by requesting a demo today.