Assignment 2

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Part 3

Implementation

Chapter 10

Managing digital business transformation and growth hacking

Digital Business and E-Commerce Management Seventh Edition

Learning outcomes

Critically analyse the journey of an organisation through transformation

Review the approaches to be taken in a digital transformation exercise

Produce a growth hacking/agile marketing plan

Create a plan to measure and improve the effectiveness of digital businesses using analytics tools

Management issues

What makes an exercise in a digital business a digital transformation project?

What are the non-technical aspects of a digital transformation project?

How do we gain traction on a limited budget?

What techniques are available to measure and optimise our services?

Does the organisation have the right culture to support a growth hacking approach?

Activity – Digital opportunities

Make a list of any new technological developments that have occurred in the last 12 months that seem to have appeared from nowhere

Consider what changes are needed by any organisation to adapt to the development

What cultural, practice or process changes could the technology create?

How would people change?

Typical responses

People might bring in aspects of digital culture

People might work different hours or in a different place

People might change the way they do something in the workplace

Definitions

What’s the difference between:

Digital transformation? The technology gets introduced but minimal change in the business.

Digital business transformation? A journey where business adapts to technology opportunities and maximizes benefits

What’s the difference between:

Adopting technology? Integrating technology into the business with minimal business change, minimal advantage.

Adapting to technology? Business has to change to get full benefit of technology

Figure 10.1 Ward and Peppard’s IT portfolio grid The role of IT in organisations, managers must understand the potential opportunity of the IT investments in a business sense.

Source: Ward and Peppard. (2002)

Opportunities provided by digital

Customer service and service design improvements

Customer insight

Adding value

Interfaces with customers

Business and organisational processes streamlined

Automation

Business models potential changed because of new opportunities

Digital at the heart of the business opportunity

Adapting the business to a digital opportunity

Framework for transformation

The process of review

Looking at where the digital opportunity is

Confidence about the digital opportunity

Leadership grasp of digital

Maturity of digital

The process of strategy, choosing applications that provide strategic advantage to the business.

The process of resourcing and planning

Design of transformation

Programme of change

Framework for transformation (Continued)

The process of deployment

The process of living with and evaluating digital transformation

Figure 10.3 Ideal skill set of a growth hacking team The goal of growth hacking strategies is generally to acquire rapidly as many users or customers as possible, generating rapid revenue growth, while spending as little as possible.

The growth hacking process

There are five key pillars to achieving growth hacking success:

Product/market fit – create a Minimum Viable Product (MVP) that fits the needs of a market segment leading to loyalty

User data analysis, find user patterns and test /optimize activities that lead to growth

Use data related to customer behavior to improve conversion rate optimisation (CRO), improving web site effectiveness

Viral growth if possible, word-of-mouth marketing

Focus on retention of customers, leads to scalable growth, cheaper to retain than acquire new customers

Growth hacking Approach

Immerse yourself in the customer experience

Understand the landscape you are operating in

Develop rules for growth in your organization

Make extensive use of pilots and prototypes

Experiment early and often to obtain big gains

Focus on asking the right questions

Use behavioral quantitative market research

Use qualitative research to improve intuition

Clearly define and communicate new offers

Encourage a culture of creativity and experimentation

Figure 10.7 The lean start-up Listen to customers and be prepared to ‘pivot’, that means change the business model

Source: https://hbr.org/2013/05/why-the-lean-start-up-changes-everything

User data analysis

The five main areas of user testing are:

Technology analysis, for example, conversion rate per browser

Heuristic analysis, for example, relevancy, distraction and online value proposition

Web analytics, for example, flow reports

Qualitative surveys, for example, exit surveys

Usability testing, for example, user session videos

User data analysis

There are seven main areas that can help improve website conversion and sales:

A/B testing (users testing two versions of a page)

Having a structured approach

Customer journey analysis (covered in Chapter 8)

Focus on optimisation

Online surveys/customer feedback

Shopping cart abandonment analysis, what caused the lack of sale completion.

Segmentation (covered in Chapters 7 & 8)

Viral growth

There are three main types of viral growth

Inherent virality: built into the product and happens as a function of its use (e.g. Skype is only useful if you share it with others)

Artifical virality: forced and is often built into a reward system (e.g. GiffGaff (mobile phone network) and it’s community of users, who help answer each other’s questions and gain cash rewards, a form of gaming)

Word-of-Mouth virality: when conversations are generated by satisfied users (e.g. Zappos (shoe retailer) and it’s high customer service, which is about ‘delivering happiness’)

Figure 10.19 Dave McClure’s customer lifecycle/conversion behaviour

Source : www.slideshare.net/dmc500hats/startup-metrics-for-pirates-long-version

Figure 10.20 Operational elements of growth hacking Summary of the operational elements of growth hacking. Finding non-normal solutions to achieve growth in a short timeframe. Each experience is unique

Figure 10.22 The five diagnostic categories for e-marketing measurement from the framework presented by Chaffey (2000)

Questions

Discuss: ‘Organisations that do not transform digitally are likely to fail’.

You are a consult to an existing organisation that is managing digital transformation. Create a guide to the process of digital transformation.

Discuss how a digital business could take a growth hacking approach.

Describe a ‘test, learn and commit’ loop and the benefits of this approach when implementing digital business transformation.

What are the main elements of an e-commerce site measurement plan?

Explain possible approaches to the implementation / conversation of a digital transformation and identify advantages and disadvantages of each option.

Summary

You should be able to critically analyse the journey of an organisation through transformation

You should be able to review the approaches to be taken in a digital transformation exercise

You should be able to produce a growth hacking / agile marketing plan

You should be able to create a plan to measure and improve the effectiveness of digital businesses using analytics tools