Some ambiguity surrounds the meaning of the term “digital business” because the digital revolution is still in its early stages. While some business leaders believe the phrase relates to a company’s willingness to adopt new technologies, other executives perceive it as a more of a consumer-centered model of doing business.
Concepts often become more clear in hindsight, and we may not see the official concept establish itself until far into the future. However, there are at least five specific characteristics we can say with certainty that today’s digital companies have that their traditional counterparts do not. Here are five things digital businesses do differently that help earn them to achieve success in the modern market.
Three years ago, the technology sector was already leading the economy in job growth by about 3 to 1. Technology currently doubles every two years, and related economic activity doubles every five years. Many believe that Moore’s law will prove itself obsolete in the near future and anticipate an economic shift centered around a primary focus on big data. As a side effect of digitization, there has been an 80 percent reduction in the life expectancy of corporations over the last 85 years.
In this variable digital frontier, speed and agility are a company’s most valuable tools. Digital businesses have a better chance of remaining profitable in a fluctuating market because they possess business practices, models, and cultures based on adaptability and speed. As a result, they can respond quickly to change and provide customers with advanced products and services more readily than traditional businesses.
Digital businesses do not expend their resources on outdated technologies. Some firms make the mistake of not updating their business tools to reflect their corresponding growth, while others experience stagnant growth because they refuse to invest in updated technology. Doing either limits a business’s ability to earn their clients’ interest, because more innovative companies can perform the same services more quickly and at a better price. According to a past study conducted by Microsoft, 90 percent of people would prefer other options rather than purchase from a company that uses antiquated technology.
Digital businesses understand the ROI of using modern tools and software and embrace the practice. Likewise, they seek out opportunities to continually improve and streamline their internal processes in order to create a more fluid workflow. This includes adopting modern workplace practices such as paperless business. Digital concepts like the paperless office increase efficiency while cutting costs on supplies such as paper, ink, printer purchases, and postage costs.
The modern market is full of consumers who desire a stronger personal connection with the company they bought from. In part, this desire to bond with a brand stems from people’s need to feel confident that they are obtaining the best value for their money. A customer’s ability to trust in a business’s practices and products play a big role in how successful a company can be in the digital age.
In keeping with this idea, digital businesses focus on maintaining strong security systems, which directly correlates with implementing modern technology and software systems. Digital businesses possess innovative tools for greater efficiency, and they are subsequently better at protecting sensitive customer information. Simple, outdated practices like paper file storage, single-tier software defenses, and a general lack of interest in embracing available security tools can affect customers’ perceptions of traditional businesses. When digital businesses adopt them, they appear more reliable and trustworthy.
Traditional business executives might argue that building a connection with customers on an emotional level is one of the most important factors in building a successful company, but their digitized counterparts perceive it differently. A key difference in the digital business model is taking the focus off of the one-time customer and redirecting the attention to long-term customer maintenance through constantly evolving business practices based on customer data.
Digital companies place an emphasis on personalized purchasing and web communications using real-time data to improve the customer experience. Social media conversations, website activity, click-through rates, customer service surveys, and studies of demographic target markets keep digital companies constantly moving forward to pursue the kinds of products and services that their customers desire most. Utilizing data, automated customer interactions can also be tailored to specific demographics in order to improve the quality of a digital firm’s customer service.
The Internet has made shopping for products and services a global and perpetually available enterprise. The ability to make sales and gain new customers online at any point in time has become a modern necessity for companies operating in the digital sphere, rendering the traditional concept of a business opening at 8 a.m. and closing around 6 p.m. obsolete. Digital businesses are increasingly implementing technologies and practices that will help them to manage customer needs around the clock.