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Digital Transformation

Digital transformation in marketing: Australia’s progress and Microsoft’s experience

Digital transformation is one of the hottest themes in business today, but what’s really happening in Australia and what does it mean for marketing?

To help answer this question, Microsoft has just released Embracing digital transformation: Experiences from Australian organisations. This new report features in-depth interviews with leaders from 30 Australian business, government and non-profit organisations. These include Aussie, the Commonwealth Bank, Cricket Australia, the Department of Immigration and Border Protection, Domino’s Pizza, Macquarie Group, Pact Group and Webjet.

This broad cross-section of organisations is approaching digital transformation in some intriguing and surprising ways. The leaders describe a variety of projects along with the challenges they have experienced and the gains their organisations have won. They also share three factors that are necessary for successful transformation: strong leadership buy‑in, an entrepreneurial culture and access to talent.

With its emphasis on building a positive customer experience and harnessing data to make better decisions, this report is a great read for marketers.

Organisations are putting customers first

According to the report, rapidly changing customer expectations typically drive digital transformation – and using digital tools to improve customer engagement is often the first step in an organisation’s journey. By adopting a digital mindset, marketers can build a deeper level of engagement with customers. Peter Harvey, Macquarie Group’s Division Director – Workplace Technology, says: “Start with the customers and start with your business. Understand their problems, their opportunities, and use digital as a tool to meet their needs.” As marketers, this makes sense to us. Customers are our lifeblood, so improving their experience is a logical starting place for transformation.

Global investments enable rapid delivery

This has certainly been our experience at Microsoft over the past two years. Starting with an ambitious vision for the future, we overhauled our global marketing operation, taking advantage of the latest digital technologies to meet the needs of our sales teams and customers. The transformation was initiated in the US, before being cascaded throughout the entire organisation.

As part of this shift, we moved from a sales-driven to a buyer-driven purchasing process. We expanded our view of the customer journey to connect with customers through multiple marketing channels, and have replaced a high volume of low-quality leads with high-quality leads generated using marketing automation techniques.

Where once we relied on face-to-face events to connect with customers, we now achieve greater reach with globally connected marketing and sales platforms. We have also better integrated field and corporate marketing teams, moving from one-off interactions with customers to cultivating long-term relationships.

It’s important to remember that marketing improvements needn’t be invented on home soil. If you have counterparts in larger markets such as the US and the UK, leverage their efforts to simplify your own experience.

Data is a marketer’s best friend

My day – every day – starts with data, specifically in a Power BI dashboard. That helps me with a central view that connects marketing with sales and allows us to identify new customer insights to improve our marketing activity. I encourage everyone in my team to spend the beginning of their day doing the same. In this way, we make sure we know our market and our contribution to the bottom line. There is truth in the saying ‘information is power’!

Our research uncovered a similar commitment to data among the organisations interviewed. Almost uniformly, they are capturing more data and converting it into insights that lead to better decisions and intelligent action. They are also tapping into this data to forge deeper, more meaningful relationships with customers. And they are producing metrics that justify expenditures and build business cases for new investments.

One institution that is creatively using data to improve the customer experience is the Royal Agricultural Society of NSW, which runs the Sydney Royal Easter Show. It has two centuries worth of information about the best food, wine and fresh produce in Australia, and is now using digital tools to turn that data into insights, and insights into actions that their customers really want.

According to Cale Maxwell, Senior Manager – Digital, PR & Content, “We’re looking at what would make a customer’s day at the Show really easy, like by pulling out their phone and it automatically adjusts to Wednesday the 17th and shows you what’s on at 10am. And it automatically shows you the attractions that are closest to you to start with – because it knows where you are.”

What I love about that story is how marketing is at the forefront of the customer journey. We’ll see this more and more as marketers take ownership of the end-to-end customer experience. 

Measurement needs to go beyond engagement

For many years, my focus as a corporate marketer was on customer engagement, trust and advocacy. I still believe these are important measures, but let’s face it, they don’t build business cases or secure investments like hard metrics do. These days I keep a close eye on revenue impact, or return on investment where applicable – and I’m not alone. According to recent global research from The Economist Intelligence Unit[1], a quarter of marketers from around the world expect revenue impact to become a primary measure of marketing effectiveness over the next few years. Yet only 17% of marketers based in Australia and New Zealand (ANZ) held these expectations[2].

The study highlights a need for ANZ marketers to embrace hard metrics. In my own experience, hard metrics have helped me communicate the value of marketing initiatives to stakeholders ranging from the local sales team to the CFO. I have also found it easier to secure funding to invest in technology like social, mobile and email marketing – essential tools in the modern marketer’s kit.

I encourage you to view hard metrics as complementary to old favourites like customer engagement – and to use digital tools to map the connections. For example, if you believe higher levels of engagement will flow through to revenue, track the relevant inputs to calculate your expected gain and build your business case around that. If you invest in social marketing, set an expectation on the reach of your messages, track the number of followers that buy from you and compare their expenditure to what it might have been had you reached them through other channels. By digitising your entire customer journey, you access unlimited possibilities for measuring effectiveness and improving marketing outcomes.

Think big, go small

For those of you just starting your digital transformation journey, it’s helpful to take a step‑by‑step approach. This is certainly the path being followed by many of the organisations we interviewed. It might also encourage you to remember that even Microsoft, with its significant resources and internal capabilities, has only recently fully digitised its marketing system. This revolution is occurring even now, as customers move online in significant numbers and all the necessary tools finally become available to create truly end-to-end, data-driven systems.

We are excited about the opportunities that digital transformation creates for marketers, and we hope that after reading this report you will be too.

Download the full report: Embracing digital transformation: Experiences from Australian organisations

[1] The path to 2020: Marketers seize the customer experience, The Economist Intelligence Unit, The Economist, 2016

[2] The Rise of the Marketer: Australia and New Zealand, slides based on research conducted by The Economist Intelligence Unit, The Economist, and presented at Marketo Sydney Summit 2015