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In the new digital marketplace, consumers are using mobile, interactive tools to become instant experts on product and service offerings and their relative merits as they decide who to trust, where to make their purchases and what to buy. At the same time, businesses are undertaking their own digital transformations, rethinking what customers value most and creating operating models that take advantage of what's newly possible for competitive differentiation.
People everywhere are using the Internet for entertainment, shopping, socializing and household management. How can businesses take advantage of the opportunity to innovate, differentiate and grow? And how can they do all this cost effectively, leveraging and optimizing the newest information technologies as part of their overall physical operations? In our analysis of leading businesses, we have found that companies with a cohesive plan for integrating the digital and physical components of operations can successfully transform their business models.
These leading companies focus on two complementary activities: reshaping customer value propositions and transforming their operations using digital technologies for greater customer interaction and collaboration. To do so, they are building a new set of capabilities that allows them to progress along both dimensions.
Forces for business change
Enabling the transformation are the devices for mobile connectivity, such as smart phones and tablets, and the creation of social networks, such as Facebook and Twitter. These developments have ignited an exponential explosion in data, which, in turn, requires powerful business analytics to make sense of the information and take full advantage of it.
Customers have a range of new choices, many of which are beyond the influence of traditional marketing. Customer decisions about what to buy are increasingly informed by social networks, where personal and business contacts, product selections, home video clips, favorite news items, even real-time location coordinates, are shared instantly and widely. For B2B purchases, people who reach out to their personal networks for advice on the latest generation of washing machines are also likely to use others' opinions on the Internet to check out their professional networks for views about business procurement choices. The habits of consumers - such as seeking independent information and advice before making a purchase - have also become the habits of business buyers.[1]
Mobility shifts time and location for customer...