Digital touches so many parts of your business and your life that it’s reasonable to ask "What does ‘digital’ even mean right now? How does it affect my business? And what should I be paying attention to?" Those are all great questions. And, fortunately, for the most part, there are some readily available answers for you.
This episode of Thinks Out Loud looks at the big trends that shape digital at the moment including shifting customer behaviors, the rise of remote work, and how those connect. We look at where those trends might be headed. And, most importantly, we look at how you can put those trends to work for your business to take advantage and continue to grow.
Want to know more? Here are the show notes for you.
Thinks Out Loud Episode 343: What Does "Digital" Even Mean Right Now Headlines and Show Notes
Show Notes and Links
Here are this week’s show notes for Thinks Out Loud with links and news related to this week’s episode. Be sure to check out all the links that matter for your business once you’ve given the episode a listen.
- The Future Digital Trends You Must Think About Today (Thinks Out Loud Episode 342)
- You Get to Make it Better (Thinks Out Loud Episode 341)
- What 2022 Trends Should Marketers Care About? (Thinks Out Loud Episode 335)
- How Much Will 2022’s Top Tech Trends Shape Your Digital Strategy This Year? Not Much (Thinks Out Loud Episode 334)
- Why Digital Transformation is More Than Just E-commerce (Thinks Out Loud 331) – Tim Peter & Associates
- The End of Millennials (Thinks Out Loud Episode 224)
- Mobile, Millennials, and…Moms? (Thinks Out Loud Episode 256)
- How to Build a Digital Company (Thinks Out Loud 302)
- The Five Drivers of E-commerce and Digital Transformation for Your Business (Thinks Out Loud Episode 293)
- Why Digital Leaders Bet on the Future (Thinks Out Loud Episode 327)
- Why Software Is Eating the World | Andreessen Horowitz
- Content is Still the King
- Is Content Still King or Have the Gatekeepers Won? (Thinks Out Loud Episode 328)
- The Single Biggest Myth in Digital: Content is Expensive (Thinks Out Loud Episode 275)
- Is Content a Strategic Product for Your Business? (Thinks Out Loud Episode 319)
- Content is King, Customer Experience is Queen (Thinks Out Loud Episode 188)
- Customer Experience is Queen? What Does That Mean? (Thinks Out Loud Episode 190)
- Why Data Matters for Marketers (Thinks Out Loud Episode 194)
- AI For Marketers: AI Makes Big Data Little (Thinks Out Loud Episode 196)
- AI Won’t Steal Your Job: Smart People Who Put AI to Work Will (Thinks Out Loud Episode 208)
- Data Management | Connect Mobile | John Deere US
- John Deere Reveals Fully Autonomous Tractor at CES 2022
- Are You a Legacy Leader? Or Are You a Future Leader? (Thinks Out Loud Episode 336)
- Why Would Anyone Want to Work For You? (Thinks Out Loud Episode 337)
- Taylor Swift’s Playbook Shows Why the Modern Marketing Team is a Media Company (Thinks Out Loud Episode 324)
- And, finally, here’s a list of top-rated charities to help the Ukraine relief effort
- A Far Too Quick Look at the Metaverse, web3, and the Future of Digital (Thinks Out Loud Episode 349)
- How to Build the Business Case for Digital in Your Budget (Thinks Out Loud Episode 353)
- The Future of the Metaverse? (Thinks Out Loud Episode 363)
We have some free downloads for you to help you navigate the current situation, which you can find right here:
- Digital & E-commerce Maturity Matrix. As a bonus, here’s a PDF that can help you assess your company’s digital maturity. You can use this to better understand where your company excels and where its opportunities lie. And, of course, we’re here to help if you need it. The Digital & E-commerce Maturity Matrix rates your company’s effectiveness — Ad Hoc, Aware, Striving, Driving — in 6 key areas in digital today, including:
- Customer Focus
- A Modern Content Marketing Checklist. Want to ensure that each piece of content works for your business? Download our latest checklist to help put your content marketing to work for you.
- A Brief Introduction to Thinks Out Loud. As a bonus, we’ve also included this PDF document that highlights some of our core episodes to help you dig into what the show is about. We think it will help you capture the show’s essence while you’re working your way through the 300-plus episodes published so far. Download it here.
Thinks Out Loud is sponsored by SoloSegment: SoloSegment increases large-enterprise, B2B website conversion with easy-to-install software that automatically connects website visitors to the content they need to see to achieve their goals. SoloSegment does this using anonymous data and machine learning ensuring privacy compliance, addressing the many anonymous visitors, and improving the efficiency of marketing teams. Visit SoloSegment.com.
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Past Insights from Tim Peter Thinks
You might also want to check out these slides I had the pleasure of presenting recently about the key trends shaping marketing in the next year. Here are the slides for your reference:
Technical Details for Thinks Out Loud
Recorded using a Heil PR-40 Dynamic Studio Recording Mic and a Focusrite Scarlett 4i4 (3rd Gen) USB Audio Interface into Logic Pro X for the Mac.
Running time: 29m 30s
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Transcript: What Does "Digital" Even Mean Right Now
Well, hello again, everyone. And welcome back to Thinks Out Loud, your source for all the digital expertise your business needs. My name is Tim Peter. This is episode 343 of the big show. And I got to tell you, I think we got a great one for you today. I think we’ve got a lot of interesting stuff to talk about.
As I said last week, there’s a lot of problems ongoing in the world. And again, I’m not an expert on that stuff, so I don’t want you to think I’m ignoring the war that’s going on over in Europe and the situation with the people of Ukraine. I’m not, I just can’t contribute meaningfully to that dialogue. So again, as I did last week, I’m going to link in the show notes to places where you can help and hear from people who do know a lot about it, but that’s not going to be me in this specific case.
Is There a "Grand Unified Theory" of Digital?
What I am going to talk about is what I do know about, and it’s kind of a funny thing because this started with somebody dropped a line, somebody slipped into my DMs, as they say, and was asking questions about this variety of interests that I have. When I talk about things on Twitter, I said sometimes post about technology. I sometimes post about the future. I often talk about digital. I often talk about marketing. I often talk about travel. I often talk about the future of work and the person who was chatting with me was kind of asking, is there some sort of grand unified theory here?
And there kind of is… and it gets at the core of what digital is today. When we talk about digital and we talk about what it means for your business, there’s a lot that you need to consider. And there’s a very simple way to think about this.
The Changes Driving Digital
- First that we’ve lived through enormous technological changes.
- The second is we’re living through a big shift demographically. We’re going through what I like to refer to as the changing of the guard.
- The combination of these changes in technology and these changes in demographics are leading to changed behaviors among customers.
- These changes in behaviors among customers are leading many companies to make changes in their business models—or new companies to emerge who have business models that are well adapted and well suited to the changes in technology and the changes in demographics and the changes in behavior that we’re seeing.
Where Are We Headed?
And so if you’re a company today that already exists, you’re not a startup, you’re not starting from scratch, it doesn’t matter if you’re a small or midsize business, doesn’t matter if you’re an enterprise, you are living through this and it’s important to ask, where are we heading and what do we do about it? And increasingly we need to ask the same things about what we can do for our employees. So the grand unifying theory is that these all tie together that they are all of a piece.
Why Do These Matter?
So let’s talk about what they mean:
The Internet and Mobile. The big one by far when we talk about technology is first the internet. I know I said the big one, but it’s really two, but first the internet. And then secondly, the mobile internet specifically. The fact that your customers carry the internet in their pocket or increasingly on their wrist with them everywhere they go. If they’re wearing earbuds, they’re wearing it in their ears every day, that has changed the way customers behave. And I’ll explain more about that in a sec.
The Changing of the Guard. The second part of that is we are now seeing that adults around 40 or millennials, if you prefer are the largest share of the workforce, and they are one of the biggest purchasing segments, simply because there are so many of them. Boomers are beginning to age out of the market. 10,000 boomers retire every single day. A and of course, generation Z is right behind the millennials, right behind adults around 40. And these two demographic cohorts have grown up with the internet for sure, and many of them have grown up with mobile for sure.
Changed Customer Behaviors. Their behaviors have been shaped by this technology as it has always existed in their life.
I’m Gen X so I don’t mean to diminish Gen X; I don’t mean to ignore Gen X as far too many people do. But we (Gen X) are learning many of these behaviors as we go. We’re learning many of them as adults. We’re learning them from our millennial colleagues and coworkers and friends. And we’re learning them from our millennial kids and from our Gen Z kids. So our behaviors—Gen X behaviors and Boomer behaviors—are changing too, just a little more slowly because we’re picking up these behaviors from the generational cohorts that followed us.
So what are these behaviors?
- Well, obviously search and social, this idea of constant connectivity. I can get the information that I want at any time I want, or I can reach anybody I want anytime I want.
- That has led to radical transparency, the information about products and services and prices all the time. Some of it are because of search, some of it shared by social media influencers, or if you prefer the new term creators.
- New media outlets have emerged as individuals learned how quickly and easily they could create content and create brands for themselves as themselves. They’re connecting with new audiences and new listeners and new followers and new readers every single day. It’s why I like to say that "the modern marketing department is a media company" because we as marketers, we as business professionals need to be using these same tools and techniques in the same way to build an audience. But we’ll come back to that.
- Now, the next big change in behavior is this concept of e-commerce everywhere or "constant commerce", if you prefer. If I can learn whatever matters to me anytime, anywhere, why can’t I get what I want, get the products or services that I want anytime, anywhere. That’s just an expectation now.
- And what we’re starting to see in a big way, is the move towards remote work. As an employee, these same folks are asking the same questions: "If I can connect with the people and the information I need anytime, anywhere, and I can connect with the products and services I want anytime, anywhere, why do I have to go to a defined space to deliver on business results in my work life when somebody else says and where somebody else says. Why can’t that be any time, anywhere too?"
Technology Changes Behaviors. And Behaviors Change Business Models.
So those are the big technological changes. The big demographic changes and the big behavioral changes that shape the current business environment. And that has led many companies to change business models or introduce new ones. First Yahoo, then Google, then Facebook, then TikTok have built significant businesses on information versus physical goods. You’ll hear some people refer to this as a bits versus atoms shift, right? They’re focusing on bits on data and information, as opposed to physical goods.
Service industries got there first. Obviously service industries like travel and finance also got on board fairly early. They didn’t rely on atoms. Their businesses didn’t rely on atoms, on physical goods. So moving to digital was relatively easy. It’s where my career started in digital. I started at Charles Schwab during the dot com boom, and then I moved into the travel space. Not saying those are the only ones, I’m saying those are the ones I’m most familiar with because of where I worked.
We also saw companies emerge that focused on differentiated niches that offered information about only travel or only finance, or like LinkedIn only business connections instead of a person’s entire social network. But the folks who succeeded understood the shift.
Everyone is making the shift. Obviously people who focused on atoms are continuing to get there. Just it more slowly overall, still they are getting there. Obviously Amazon and books was the earliest example or one of the early examples. But if you think about somebody like John Deere, who’s using data about how farmers and other people who use heavy machinery used its plows and tractors and its combines, well, it enabled new lines of businesses for them, new products and new services.
We saw the same thing with Uber and transportation. We saw the same thing with Airbnb and room rental, short term rentals. We saw the same thing with WeWork and office space. In fact, I’ve argued as well as others that digital eventually makes everything a service.
Marc Andreessen had a famous statement that software eats the world. That’s what we’re talking about. We’re talking about how bits overtake atoms sort of as a natural consequence here, it just kind of happens.
Digital Transformation is Business Transformation
And the changes in these business models, the changes in these business realities have caused many companies to rethink how they ought to run. When we’re talking about digital transformation, that’s what we’re talking about.
I’m a program director for the Conference Board’s Chief Digital Officers Council, and we’ve got a working thesis that digital transformation is the process of creating the company you would have built if digital or mobile or the internet had existed when your company started. We like to say that companies like Google or Facebook or TikTok or Uber or Airbnb didn’t need to undergo digital transformation because digital already existed when they got going, there was no need for them to transform.
If you want to put it more simply, digital transformation is business transformation.
Where Will You Go Next?
Now, if we’re going to talk about business transformation and digital transformation, it’s probably worth asking, well, where are we going? How should we transform? Where are we trying to end up? And I want to start by saying that working thesis that I mentioned a second ago has a false assumption of it and a deliberately false assumption in it.
Google and Facebook and TikTok and Uber and Airbnb absolutely are undergoing digital transformation of some kind or other. It just depends on where they are in their particular journey. For many of them mobile and cloud computing and artificial intelligence and conversational computing and virtual reality and augmented reality and extended reality and the metaverse and blockchain and Web3 and whatever comes next will force some to change and will cause some to fail. That’s just the reality of it. We know this, you adapt or you die. Sometimes slowly, but that’s kind of the way it works.
Now, the pandemic has only accelerated these changes. It also shifted the conversation a little bit, and I’m going to come back to this in a minute, but it’s shifted conversation where workers are now asking, well, our customers are benefiting from all these changes, why don’t we get to benefit as well? Which is driving another round of digital transformation. Changing behaviors is driving new business models.
Why I focus on travel. For instance think about the local businesses and the office space providers and airlines and hotels and conference centers that depend on business travel for their revenue and for their benefit, all of these expected and depended on the world working a certain way. And because it doesn’t, and doesn’t seem like it’s going to return to it, at least in the same way we knew that’s causing enormous disruption. As I’ve talked about before, the US is a roughly $20 trillion economy. Even a 5% shift in the US is a trillion bucks.
Lots of other countries have economies valued at multiple trillions of dollars. There are lots of trillion dollar industries. Again, even a 5% shift in any of these is a lot of damned money. This is nothing trivial we’re talking about here. And we’re still figuring out what the new normal looks like. Transformation is not a destination. It’s a process. And it’s something we’re going to be living through for years to come maybe forever.
How Do You Prepare?
So the question becomes, what can you do if we take all of this for granted, if we take this as the new reality?
And there are a number of frameworks that works, some of these you’ve heard about before one of the big ones is this idea that content is king, customer experience is queen and data as the crown jewels. I don’t want to belabor it, but I do want to explain it a little bit.
Content is King. Let’s start with "content is king." Digital, regardless of its form relies on content. Its form and its format may change, has changed, will change. Text and images and video and audio and virtual reality and augmented reality, those are all different types of content. They all matter to some degree and some of them will matter more than others in the future. That’s the way it works. The distribution channel, how your customers experience that content will undoubtedly shift.
We started with the web and then we got search and email and podcasts and YouTube videos and VR experiences, what have you. Yeah, that happens. It’s okay. Do you know that I started this podcast because I saw that the share of mobile traffic coming to my site was increasing. And as the amount of traffic that came to my company’s website went up, we found that people engaged with blog posts less frequently. They didn’t engage at the same level. This podcast existed as part of our mobile strategy. How do we connect with people when they’re on the go? And it’s worked, it’s worked really well for the business. At some point, will I retire the podcast or maybe give it a lower priority as customer behavior shift? Maybe it’s VR or the metaverse or something, maybe, but this occurred because it was a different type of content for a different audience because of a technological change and that drove a behavior change.
Customer Experience is Queen. Now, if content is king, "Customer experience is queen." Remember those creators and influencers I talked about before? They’re building brands based on who they are. More importantly, they’re building audiences who listen to what they say. And many members of those audiences are telling their stories to friends and family and fans and followers on social. Sometimes it’s scale, but most of the time, just one to one or one to some very small number. The question you need to ask is what are they saying about you? How are they participating in the creation and curation of your positive brand story? That only happens if they have a positive story to tell, which is one of the reasons why customers experience as queen.
The other reason is that your competition is just one click away. You are being compared with the best experiences customers have everywhere. If you do a good job, they’ll be back. They’ll tell their friends and their family and their fans and their followers. If they don’t have a great experience, if you don’t do a good job, they know what’s possible. Because they see it from the companies that they love every single day. And it’s easy enough for them to find someone else who can provide the customer experience they want to them.
Data is the Crown Jewels. Of course, if there’s a king and a queen, there’s got to be some jewelry around somewhere. That’s why data is the crown jewels. Data is treasure. I mentioned before that John Deere is using data about how its customers use its products to both inform its product development and also as a product itself.
For instance, if you use Deere’s products, you can subscribe to data services from Deere about how those products are working and how do you use them more effectively and efficiently. They’ve also developed a self-driving tractor that is in theory anyway, more efficient and more effective than human driven ones. They’re using data to improve the overall experience. And of course you can do a more simple version where you use it to inform your content that you create to answer the questions your customers have.
So that’s one framework, right? Content is king, customer experience is queen, data’s the crown jewels.
Core and Explore. Another is this idea of "Core and Explore." The companies that are succeeding in their digital transformation aren’t the ones that try every new thing. They’re not the ones that go nuts with every possible option. Instead they use data to anticipate, to analyze and adapt. They move quickly when they see what’s working and kill ideas quickly that don’t work. They’re spending most of their time of the things that they know work 70%, 80%, 90%, and they leave some time 10 or 20 or 30% test new ideas. That’s the explore part of core and explore.
There’s this quote, I just talked about it last week that "we always overestimate the change in the next two years and underestimate the change in the next 10." Most things won’t change all that much in the next two years. I feel pretty comfortable saying that when we’re sitting here two years from now, what we’ll be doing and how we’ll be working and how we’ll be interacting will be pretty similar to what it is today in most areas. At the same time, most things will change—and a lot—in 10 years time.
So spend most of your time in the next two years and at least the next two months on the things that you know work and start testing to be ready for those that change further out.
Again, I point to this podcast, I’ve been doing this show for almost eight years suddenly now everybody’s got a podcast. I’ve been doing it for eight years—we’re on episode 343 for heavens sakes. We got in early with small scale tests, saw success and kept at it. What you don’t see is all the other stuff we tried that didn’t work because we stopped doing them right. Core and explore. If the exploration says, "nah," then accept "nah," and move on.
You Can’t Take Care of Customers if You Don’t Take Care of Your Employees. And then the last big shift is you can’t take care of customers if you don’t take care of your employees. This is something people have known for a long time. This is hardly new information. I don’t know if remote work is right for every company or if it’s right for every role. What I do know is that employees increasingly expect, rightly I think, that the digital tools that make their customers lives better should also make their working lives better. I know that the companies that take this transformation seriously are doing a better job of attracting and retaining talent than those that aren’t.
There’s this guy, Greg Shill, who’s a professor at Iowa Law School. He pointed out on Twitter the other day about the record profits that many firms have reported for the past two years. And he said "I was a remote work skeptic and have remained more skeptical than some spontaneous collaboration and all that. But if there’s a big cost to business productivity from telework, it’s apparently showing up everywhere but in the statistics." I mean, what a telling quote as somebody who was not a big fan of remote work and clearly can see that companies are benefiting just fine. Do you think your employees don’t see that? Do you think they don’t realize what it means?
I was out for dinner the other night with some friends and one of the people I was with their company now requires everyone to come into the office a few days a week. And he told me that for the first few weeks, the parking lot at the company was jammed. And every week since they’ve gone back to the office, the parking lot has gotten less crowded. People are finding, you know what, I’m just going into the office and doing Zoom calls, I can do those from anywhere.
Worse, senior leaders aren’t showing up every day. They were going to the office and jumping on Zoom calls and figured why bother with the commute? Now, what message do you think that sends to most employees? What do you think that’s going to do to retention rates? I’m not going to make a bold prediction about exactly how much it’s going to hurt them, but it’s certainly not going to help.
So we are still in this shift. It’s why core and explore makes sense. Maybe the right thing to do is not to require everyone in the office, but instead, maybe test a variety of hybrid and remote and in office configurations to see what drives retention and what drives productivity and what drives profits before committing to a blanket approach.
Conclusion: What Does "Digital" Even Mean Right Now
Again, what we do know is we’re clearly living through a change and there’s a way to do it the right way. So what even is digital today? What is digital about? Well, it’s about technological change and demographic change that drive behavioral change and how businesses change in response. We’re heading into a period where we’re going to see increasing change and we need to be ready. And the ways we can be ready is to remember that content is king, customer experience is queen and data is the crown jewels. To remember that core and explore is a great way to affect that change and learn how to do better. And that you cannot take care of customers. You cannot take care of the queen of customer experience if you don’t take care of employees. And that you can use those same digital transformation frameworks to affect and improve the law lives of your employees, just the same as you might your customers. And then if you do that well, you’re going to do really well as we go forward.
Now looking at the clock on the wall, we are out of time for this week. I want to remind you that you can find the show notes for today’s episode, as well as an archive of all past episodes by going to timpeter.com/podcast. Again, that’s timpeter.com/podcast. Just look for episode 343.
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