Experimentation in every industry is critical for development. Items we use every day have iterated to where they are now thanks to experimentation: the car, the computer, the smartphone, and more. 

Experimentation in marketing is no different. Simply put, marketing experimentation tests data-led ideas to see whether they affect a variable, such as product usage, user acquisition, trial sign-ups, etc. 

Many marketers are intimidated by or misunderstand experimentation. Add to that challenges like getting boardroom buy-in and securing budget for experimentation, and you can see why it’s a growth technique that struggles to gain adoption within many organizations.

In this article, I’ll illustrate the importance of marketing experimentation as part of your digital transformation.

Marketers spend a lot of time collecting and interpreting data. A study conducted by PHD and Warc found that 88% of marketers spend most of their time on reporting tasks, like tracking performance and producing digestible audience insights for stakeholders and other departments. 

From measuring and reporting traffic trends and conversion rates to sending surveys and facilitating focus groups, so much of marketing is about gathering data. Marketers then use these findings to blindly change the customer experience, with the hope of increasing conversions, and hitting KPIs. 

With so much dedication to reporting on the data you already have, it’s understandable that spending additional resources on experimentation makes some marketers nervous. 

Before I get into why experimentation is actually a good thing for digital transformation, let’s take a look at why many marketers avoid experimentation. 

While I understand why marketers sometimes avoid experimentation (see above), the benefits far outweigh the risks. Sometimes the biggest challenge for those new to marketing experimentation is understanding that experimentation is not a replacement for data-driven decisions.

On the contrary, when done correctly, an experiment is entirely data-driven: it begins with methodology and analysis and concludes with supporting or refuting evidence. Experimentation and data work together to drive better business decision-making.

Here’s an example of a company that used strategic experimentation to produce real results. 

When the Smart Panda Labs team started working with Viceroy, we suggested A/B testing. Like many stakeholders, they were skeptical.

Our team focused on a button on the hotel group’s website that acted as a “submit” button and linked to their booking engine. The goal was to increase room searches by determining which copy led to the highest click-through rate. 

There was a clear winner from the first experiment (“Book Your Room”), which we then pitted against a slightly more descriptive alternative: “Check Availability.” Check Availability won out overall, and this change in something as small as button copy increased room reservations by $30,000 per month. 

When you’re trying something new, it’s best to start small, confirm your hypothesis, and then go for bigger fish. After proving that experimentation had a genuine impact on revenue, we ran a larger test based on a hypothesis about a new landing page. The result was a $600,000 increase in incremental revenue per year. 

There are many benefits to experimenting, which can be seen across an array of marketing activities. Here are some experiments to consider and the benefits that come with them.

While great marketing is data-driven, there’s also an emotional component to consider. Everyone develops cognitive biases based on our experiences with the world—including your customers. Marketers often leverage these biases to see if they deliver the desired results.

For example, maybe you’re building a hypothesis around CTA conversion rates and decide to test “Your favorited item is selling out—only 5 left!” (employing the bandwagon effect and scarcity mindset) against “10% off your favorite” (the belief that you’re getting an exclusive bargain). 

This experiment may lead you to use a more effective CTA and help you better understand your customer. Are they more socially motivated, wanting your product because it’s popular? Or, are they more motivated by a good deal?

Experimentation doesn’t need to be complex. A/B testing projects can result in real revenue wins. Real estate firm Related Companies increased their lead conversion by 26% using a similar experimentation method. 

Speaking of knowing your customer, it may not come as a surprise to hear that people consume information in very different ways. Rapidly experimenting with different content formats and platforms will ensure you don’t miss any opportunities to reach your target audience.

For example, you may be surprised to learn from market research that your competitors are using TikTok. The move here isn’t to hire a full-time TikTok expert and invest half your budget into marketing on this platform. Instead, run very specific tests based on what you learned. 

There are many additional ways to experiment with digital marketing. Hopefully you can see that experimentation can have real financial results. Even when experiments fail to support your hypothesis, you benefit from a valuable takeaway and a clearer direction, as well as saving your company from a revenue loss if the change had simply been rolled out without testing. 

Ignoring experimentation is detrimental to a digital transformation because without actioning data or analytics, marketing teams are just sitting on reports. 

While your tried and true marketing strategies may keep you afloat, it will be hard to compete when other companies are willing to take risks to accelerate their growth. 

Of course, it’s important not to experiment for the sake of experimenting. Let’s carry on with our TikTok example above. 

If, overwhelmingly, the data shows your audience prefers email marketing and they never use TikTok, experimenting on the video platform would likely be a waste of time. You should only experiment when the data can be interpreted to fit multiple hypotheses, which you would then test to determine the direction for greater marketing efforts. 

On the other hand, if you ignored survey data that showed TikTok is a growing platform of interest, you could be missing out on reaching potential customers in the way they want to be reached. 

Here are a few key actions you can take to begin accelerating growth with experimentation. 

Identify the specific component of your marketing strategy that would benefit from an experimentation project. From there, set goals and objectives. Be as specific as possible in determining needs unique to your business and competitive landscape. 

If you’re a retailer, you may want to optimize the checkout flow of your ecommerce site based on data that tells you where users are dropping off (perhaps survey results point to customers feeling annoyed they have to log in again). Your goal would be to convert more customers by coaxing them past this drop-off stage. Then you would design experiments based on the data (perhaps by creating a guest checkout option or moving log-in requirements to post-purchase).

We know that experiments should be rooted in some type of data. But data comes in many different forms. Sometimes, you’ll have a lot of it in the form of reports, surveys, performance metrics for past marketing campaigns, etc. 

Sometimes, the data can be based on competitor insights. For example, perhaps several of your direct competitors have gated their webinar content. You learn from customer research that many of your best leads have watched your webinars and find value in them. Your hypothesis for this example might be: putting our webinars behind a gate will lead to more leads because this content is in high demand with our prospects. 

Stakeholders can be reluctant to experiment. Start small and prove the concept is worth pursuing. Consider A/B testing copy instead of a website overhaul. Test different types of email subject lines. Before pivoting from long-form written content to TikTok videos, run a test to see how they perform against each other. 

When you have a clear understanding of your organization, its competitive landscape, and relevant testing opportunities available to you, it’s time to take your findings to the boardroom. 

Remember, at least one person around the table will likely be skeptical when it comes to experimentation. Come prepared with data-backed hypotheses, as well as success stories from competitors to get them excited. Pick a pilot program to get started with so you don’t overwhelm them with requests for budget and resources. 

The best marketing strategies leverage a combination of data and thinking outside the box. While it can feel counterintuitive, the data helps you narrow down what you’re getting creative about—should we be on TikTok or LinkedIn? Should we be driving our content topics by SEO or leveraging influential experts? 

Once you have evidence that a specific marketing activity is where you should be experimenting, then it’s time to create your hypothesis, test, and learn. 

Experimenting is an exciting way to test hypotheses and ensure you’re staying relevant to your customer. With thoughtful, actionable hypotheses backed by data, you’ll be amazed by what you may learn through the experimentation process.

The newspaper industry has been in a steady downward trend for decades now, but they faced their sharpest decline in 2020. It’s no surprise that print newspapers aren’t the household staple they used to be. 

Where readers once turned the thin pages of the latest issue over their morning coffee, they now get their daily news digest the way they get most other information—digitally. 

While many media companies have struggled to create a relevant, high-quality digital experience in the new business model, the New York Times continued to add paid subscribers to its online news product. They now have over 7.6 million digital subscribers.

In this article, I’ll walk you through how the New York Times has managed to cut through the noise and secure subscribers in a crowded media landscape. 

Transitioning a product to fit changing behaviors is challenging. Alongside the need for a shifting product, demands for top-tier standards also tend to increase. People still expect high-quality journalism; only, they want more of it. 

To create an effective digital strategy, the New York Times listened to the people who canceled their physical newspaper subscription in favor of solely consuming digital news. They also realized early on it wouldn’t be as simple as pasting their high-quality journalism onto a digital medium.

Of the transition to digital, former New York Times CEO Mark Thompson said: 

Understanding how to transfer paper-based readers over to digital subscribers would take a combination of listening to the customer, experimentation, and a willingness to iterate until they got it right. 

The Times uses data to understand why a person might come to their pages, how engaged they are once they arrive, and finally, their demographic profile. Based on this data, they then decide what actions they can take to create a meaningful experience for that person that eventually drives them to pay for a full-access subscription. 

I should also note that here, a subscription means paying to access different aspects of the New York Times content, whether that’s unlimited digital access to the times, digital access plus a print subscription, or add-ons such as the New York Times cooking app (more on that later). 

Getting to know their customers was step one to creating a digital media platform that could evolve with, and for, its audience. One period that proved particularly helpful in enabling the Times to get to know their audience was the very traffic-heavy first quarter of 2017. This increase was a result of the 2016 presidential election and Trump’s inauguration. 

Even since then, Thompson said the Times has become increasingly expert at understanding its subscribers at every stage of the marketing cycle, including retention and churn. He describes the entire organization as focused on the customer journey and the customers’ fundamental experience of Times journalism. 

By understanding where people spend time and how they navigate the site, you can begin to understand what your customer values and what makes them tick, both critical for figuring out what might make them become paying subscribers. You can get a basic understanding of user behavior in Google Analytics and then go deeper based on your findings. 

Top Tip: Customer loyalty is crucial to profitability and sustained growth. Here’s how to use customer intelligence to turn data into actionable insights 🐼

Gaining digital subscribers was always going to look different from the tactics for gaining print subscribers. Fortunately, there are many more opportunities to grab the attention of many different types of people. The caveat to the wealth of access to people online is knowing how to even begin identifying who these people are and what they want from your brand or platform. 

Increased experimentation with product development has been pivotal to the New York Times’ digital transformation success (and new subscriptions). 

At the helm of new product development is Times’ internal team: Beta. Beta is responsible for now well-known features like the NYTimes Crossword, the Times’ real estate app, and NYT Cooking (more on that later). 

It’s Beta’s job to take the Times’ already excellent journalism and turn it into a digital experience that solves a specific reader problem. From helping people figure out what to eat for dinner to how to exercise and where to live, Beta helps make the Times a daily, trusted destination for its readers.

It’s also Beta’s job to understand where to allocate resources. If something isn’t performing (for example, NYT Opinion which failed to attract a sizable paying audience), it’s shuttered. For every failed Times product, there’s a slam dunk. The Cooking newsletter has over 600,000 subscribers and its weekday edition has a 50% open rate. 

Top Tip: In order to analyze and iterate, you’ll need data. Here’s our guide to digital analytics 🐼

One example is the Times’ cooking site and app. You’ve likely come into contact with it through one viral recipe or another. To access their comprehensive list of thousands of unique recipes, you’ll have to purchase a subscription: $5 per month or $40 annually. The product (including an app) has attracted over five million monthly users since 2014.

In addition to creating new products (other examples include podcasts like the highly popular The Daily and products like the crossword app), the Times has also acquired several external products—and their users. In 2016, the Times acquired Wirecutter, a product recommendation service, and it generates digital revenue through both affiliate links and a paid subscription version. 

Most recently (and perhaps most notably), the Times acquired global puzzle sensation, Wordle.

Players get six chances per day to guess a five-letter word. It may sound simple, but the Times knew it would appeal to its digital audience.

While the player count sat at an unimpressive 90 in November of 2021, it is now estimated that 14% of US adults are logging in daily.

Addressing the acquisition in a recent statement, the Times noted it “remains focused on becoming the essential subscription for every English-speaking person seeking to understand and engage with the world”, supporting the company’s “quest to increase digital subscriptions to 10 million by 2025”.

According to Thompson, building and acquiring different products over the last several years was highly strategic. He said, “It was about trying to get a conveyor belt of improvements and ideas and things to develop and optimize that was constantly being added to—and that we were constantly exploiting.” 

Not every new product involves creating or buying an entire app. The Times has also experimented with creating content in different formats, like interactive long-form articles and digital advertising efforts like sponsored articles. These efforts may not correlate directly to subscription revenue but add to the high-quality experience someone may come to expect from the Times, which could lead them to become a new subscriber.

As mentioned, one of the new products the Times began testing in the past five or so years is podcasting. The end goal of any new channel is ultimately to increase digital subscriptions. But there are many different ways the Times can introduce itself to a potential subscriber. 

For example, someone may come across The Daily by browsing top podcast recommendations. After listening, they may be more likely to turn to the Times for other news, putting them in the top of the Times’ marketing funnel. Additionally, podcasts feature ads, so this channel is also a means of increasing and diversifying advertising revenue. 

Other channels the Times has tested include social media, like the Snapchat Discover feature and Facebook Instant articles, as well as 360 videos, virtual reality, and the popular messaging app, WeChat. 

Not every team will be able to build and buy products at the scale or speed of the Times. A takeaway most teams can relate to is that it’s important to give autonomy to team members outside of the boardroom to move quickly. 

Thompson said, “We moved to a matrix structure where the team leaders—often very young, late 20s, early 30s—have power over the product and tech road maps and can make decisions based on what they learn from the testing-and-learning platforms, without regard to senior leadership.”

By giving agency to up-and-coming decision-makers, the Times could test, gain insights, and pivot or scale rapidly. 

To accelerate digital transformation, it’s important to have the whole team on board—starting with leadership. While Thompson was replaced as CEO in 2020 by Meredith Kopit Levien, he was brought on board as president and CEO of the New York Times Company in 2012 to figure out how the Times could succeed in a digital-first world. 

Top Tip: The pressure is on for businesses to digitally transform. Here’s how to accelerate the process 🐼

Right away, Thompson and executive editor Dean Baquet saw an enormous opportunity in a digital-first newsroom, as well as experimenting until they got it right. 

Getting the rest of the leadership and stakeholder team on board took time. Thompson describes six difficult months of debating, but eventually, the right people were in place, and stakeholders bought into the strategy. 

The Times created a 14-person executive committee, one of whom (Roland Caputo) was tasked with keeping print on track. The other 13 (including EVP, Product and Technology, and Editor for Innovation and Strategy) have been assigned to think primarily about digital.

Another notable digital move came in 2015. “Project 2020” was a plan put in place to emphasize using innovative, high-quality digital content to attract and retain subscribers and double digital revenue to “at least $800 million” by the end of 2020 (a goal they surpassed in 2019).

Speaking on Project 2020’s digital goals, Baquet wrote, “Make no mistake, this is the only way to protect our journalistic ambitions. To do nothing, or to be timid in imagining the future, would mean being left behind.”

The Times’ focus on subscribers emerges from a universal challenge facing modern media: the weakness in the markets for print advertising and traditional forms of digital-display advertising. 

By focusing on subscribers, The Times also maintains a stronger advertising business than competitors. Advertisers crave engagement—readers who linger on content and who return repeatedly.

Thanks to their interactive graphics, virtual reality and Snapchat Discovery features, and Emmy-winning videos that redefine storytelling, The Times attracts an audience that advertisers want to reach.

Top Tip: If Thompson’s early struggle resonates, we wrote a whole article about how to get boardroom buy-in for your digital maturity initiatives 🐼

Baquet, who was managing editor before becoming executive editor, brought an enormous cultural change to the Times. He empowered conversation and collaboration between the newsroom and business departments of the company, with the teams now working side-by-side.

While this was a huge change for previously siloed departments, Thompson describes how Baquet had trust and buy-in because of his traditional news background. A former investigative journalist and experienced editor, Baquet is a “newsman down to his fingertips and is trusted by everyone because of that,” according to Thompson. 

Even with his traditional newsroom background, Baquet gave his blessing to radical digital change. But because of this very same traditional background, people trusted him not to compromise the integrity of the content or journalism in favor of digital growth. 

The role Baquet played in the internal buy-in is an important lesson: having a change leader like Baquet, who is both a trusted industry expert and open to radical digital change, helped create a path forward for the entire Times team. 

Creating a cross-platform experience requires a lot of tools and often a complete rehaul of your tech stack. This isn’t a change that can happen overnight, and it’s important to plan for what you’ll need as well as rank in order of urgency. 

Top Tip: Building a digital roadmap that shows objectives, a timeline, and resources needed to achieve each goal will help you get organized 🐼

The Times has allocated a third of its budget to restructuring its data architecture and aligning teams on the proposed changes. This investment has gone into modernizing and integrating its data systems to enable the data-driven decision-making discussed above, and also machine learning capabilities. In today’s media and technology landscape, people expect personalization. We log onto Netflix and see shows recommended just for us, and we expect the same when we read the news. 

Similarly, the Times newsroom team decides which information should be displayed on their homepage or in push notifications using data architecture. The data team builds tools that help the newsroom understand a user’s behavior. Then, the newsroom can deliver the right messaging at the right time. 

The Times can also use data to personalize a reader’s experience. Leveraging behavioral analytics, the team can deliver relevant, fresh content or target them with the right messaging for the best subscription package for that reader. 

When it comes to teams, the Times has not only reduced silos but sought multidimensional hires who understand both great journalism and great technology. The Times boasted in 2017 that “no other newsroom in the world has more journalists who can code.” These are undoubtedly more difficult hires to make, but someone who can write a great piece and then code and publish it makes the entire operation significantly more agile. 

Assess your current team to determine where people’s primary and secondary talents lie. Understanding where and how you can lean on team members—and where they want to boost their own skills—will be mutually beneficial and help expedite your digital maturation process. 

When print subscriptions became all but obsolete, media companies faced an uphill battle—one which the New York Times is winning. By rigorously analyzing customer data, the team can make educated attempts to deliver content their readers will love. That framework allowed them to create momentum to keep them moving in the right direction.

This process has worked because of rapid experimentation and team members with agency and autonomy over their products.

Also critical to the Times’ success is a leadership team that fully believes in their digital-first strategy, and that content quality need not be compromised for profitability. 

The Times put in the resources to get the right tools, technology, and team in place to create a superior digital experience for their audience. With such a strong foundation, they were able to build something that empowered their growth into digital maturity.

There’s no question that the pandemic has supercharged the speed of work and adoption of cloud-based and remote work solutions. Now, organizations are looking to optimize their remote-enabling tech stack and processes.

From the consumer side, the race is on to enhance digital offerings and platforms as more and more companies pursue five-star customer experiences (both in-store and online).

To enable these improved experiences, and succeed in today’s business landscape, you need to set your team up with the right tools, skills, and roles.

In this article, I’ll explore how to set your team up for a successful digital transformation. 

Before undertaking a project with the scale and magnitude of a digital transformation, it’s important to understand your current business landscape, what has to change, and why. 

Start by evaluating your current team members and their skills. Decide whether you would benefit from external help (new hires) or if you can work with the talent you have and swap roles around where necessary. 

For example, you may want to prioritize user experience on your website as you deal with a high volume of traffic. However, you may only have one person, or a very small team, in a UX role. If the goal is a complete digital transformation, you may need to hire additional team members or find an agency to supplement your current team. Don’t just assume what is needed; speak with this person or team to find out what gaps exist in their department. 

Depending on your foundational team and end goals, your team may change drastically. This can disrupt your company culture, so it’s important to make changes thoughtfully and map all changes toward business goals.

Once you’ve identified those gaps, talk to the department to find out how you can first fill them with internal resources. Ask each department to make a list of both necessary and nice-to-have upgrades. You can also ask if any of your current staff would be happy to fill these roles if developed in-house before hiring out to an agency. 

You’ll likely need a project manager to navigate these discussions. Taking stock across teams and determining what you need is intense and demands a lot of attention. A person or team who can navigate all of the moving pieces will be invaluable as you do your research and create your digital transformation roadmap. Going back to the UX example, consider the time needed just to find, track, and interview multiple contractors and agencies.

Once you’ve assessed your existing people and skillsets, it’s time to start thinking about expanding your digital arsenal. Digital transformation won’t happen overnight, so think through which role (or roles) you’ll need in place immediately and which can wait until later on down the road. 

Here are some roles you may want to think about, as well as how each contributes to a digital transformation strategy. 

As you begin your organization’s digital transformation, you’ll want to have a chief digital officer. Your chief digital officer will work closely with your chief of data (more on this role later), using data to drive growth and make informed decisions on new digital products, platforms, and services. 

The chief digital officer will lead the charge on implementing digital upgrades that will help transform your organization to digital-first. This role will also be crucial for bringing updates and obtaining buy-in from the boardroom, acting as the bridge that brings everyday activities to executives whose focus may be elsewhere. 

Your CIO will serve as the executive connector between business goals from the C-suite and the IT innovations necessary to implement technological developments and updates. This role approaches everything from the technical perspective, accelerating the momentum of the transformation.

Because both CDO and CIO roles are essential to the changing business landscape and evolving company culture, some organizations may have a CIO concurrently serving as the CDO.  

Perhaps the most critical role that your organization may not have before pursuing a digital transformation is chief of data. This executive-level leader is responsible for managing, gathering, analyzing, and interpreting data across the business. Depending on your organizational needs and structure, this role may include the duties of a chief data officer.

Data will be critical throughout your digital transformation. The person in this role will use data gathered from your CDP to inform early decisions and provide evidence of success to key stakeholders. So, it’s important to make sure this person is qualified and in place from the start of your digital transformation.  

One of the newer roles to enter the digital transformation landscape is the business processes expert. This role is in high demand as it requires both business savvy and a deep understanding of the technological landscape. 

A business processes expert should understand your business’s current workflow and identify where processes need to be optimized to enable a digital-forward approach. They may recommend leveraging technologies like artificial intelligence, machine learning, and automation to catalyze workflows for your organization’s new digital strategy. 

Your business may handle large volumes of customer data, such as purchase and contact history. A business processes expert will likely enlist the help of a customer relationship management (CRM) platform to enable quick access to actionable insights and decision-informing data. If you run an online store, you’ll be able to spot popular products and buying patterns that can help fuel your marketing efforts. 

While making big changes to a business strategy involving data collection and analysis, it’s critical to ensure you adhere to security and compliance protocols. A security and compliance specialist will be responsible for the security and privacy strategy, ensuring data use meets all legal, privacy, and governmental requirements. 

They’ll also protect your company from data breaches and security threats. They may, for example, host a live anti-fraud and anti-smishing session for employees and teach them to recognize scams when they come in.

While this may not be a role you hire for, project evangelists are critical to the internal buy-in of digital transformation. Ensuring that team members are bought into a digital-first strategy is crucial, especially at the leadership level. Project evangelists embedded within your organizational structure will increase adoption of and enthusiasm for your business transformation journey. 

Consider adding digital training to leadership development initiatives, and be transparent around the “why” behind digital transformation projects. Your team must understand the importance of the digital experience for today’s consumers and how it impacts broader business goals. Project evangelists will help this happen faster. 

You may want to select a project evangelist from within each team and decide on a cadence for updating them on your digital roadmap. Each evangelist can then provide updates to their teams in a way that is relevant to their roles and functionality.

Like your project evangelists, a change leader helps your broader team see that a digital transformation will positively impact the company. When both culture change and changing business models are occurring simultaneously, it’s important to have a change leader who consistently highlights and proves the positive impact of digital transformation. 

Digital changes impact both personnel (e.g., reducing workload) and business performance, so having someone champion these positive changes is important for digital transformation success.  

Consider how and when the change leader will communicate with the broader team. Perhaps they write a monthly internal newsletter with updates or speak at all-hands meetings. The change leader should also help the company celebrate wins to establish a culture of positivity around digital transformation. 

It’s more important than ever that finance works cross-functionally when it comes to a successful digital transformation. By partnering with more technical teams, a financial analyst can help evaluate the costs of new technologies and bring risk management awareness to strategy discussions. 

A financial analyst will help evaluate and track different tools from an ROI perspective. While there are other perspectives to consider, having someone look closely at cash flow is an important piece of the greater digital roadmap puzzle. 

Once you have your digital transformation strategy in place, you need people who can execute it and bring it to life. One such function will fall to cloud architects: IT specialists who can develop, implement, and maintain the cloud strategies specific to your new operating model. Because businesses will continue moving applications to both public and private clouds, an ideal candidate will have experience that spans various elements of IT and is familiar with emerging cloud-native technologies. 

While the roles mentioned above are crucial to the internal team structure, a UX/UI expert creates your end-user experience. This role tends to be thought of as a “nice to have,” but in today’s customer-centric world, it’s a “must-have.” 

By understanding the business strategy and relevant data, this person or team will create user-centered platforms through which your customer interacts with your brand. Without this role, you could end up with great tech that no one uses because it isn’t optimized for the customer (we’ve seen this time and again). When this happens, ROI on your tech investment is painfully slow.

From the user journey on your website to social media and email, this team focuses on creating a cohesive, intuitive omnichannel experience that will continue to evolve based on data and customer feedback. 

You’ll also want to add at least one person to your team (or train existing team members) to focus on optimization and experimentation. The digital transformation will be ongoing and need constant attention for efforts to keep delivering value. 

This role will measure the customer experience (CX) and iterate improvements. If the right foundation of technology and tactics are in place, you can establish a framework of analysis and experimentation that continuously tests and optimizes this experience. With this in your back pocket, you can drive success despite marketplace disruption.

Once you have the right team in place, as well as boardroom approval, it’s time to think about the next phase of your business transformation. Next up: planning your digital roadmap. 

Once leadership is on board, and a strategy is in place, it’s time to work toward cross-functional buy-in across the organization. Be fully transparent about goals and guidelines and be open to suggestions. 

If your data isn’t already centralized, different teams will have insights into various aspects of your organization. Getting input from across the organization can help fill in information gaps you may not even know you had. 

Your roadmap will outline objectives and deadlines, as well as people and teams responsible for executing and approving items. Consider your digital roadmap a living, breathing document and provide opportunities for team members to share ideas, concerns, and even frustrations. 

Here are a few ideas for mapping out your digital transformation objectives and communicating them. 

You will need to meet many smaller goals and objectives before your team ultimately crosses the finish line. To the best of your ability and with the information you have today, start to break your big goals down, bit by bit, and team by team. Create objectives and identify the projects, tasks, and people that ladder up to them, including timelines for each. 

For example, one piece of your digital transformation could be developing a more personalized customer experience. Even this is a hefty goal; one sub-project might be creating a tailored rewards program, another a more technical cookies experience for tracking customer preferences. Work with leadership to determine how specific you want each breakdown to be.  

Uncertainty can be scary, but if there’s one thing everyone in your organization will align on, it’s the importance of a positive customer experience. 

We live in a digital-first world, and customers are used to a personalized, intuitive, and simple experience. If they can’t get that from your company, they will look elsewhere. With this idea as the cornerstone of your digital transformation narrative, it will be easier to align skeptics toward your emphasis on digital business. 

Sharing data and metrics will also help get—and keep—the team on board. Sharing how a particular customer journey optimization strategy resulted in increased revenue, or how a machine learning recommendation engine increased engagement, will be invaluable in proving the competitive advantage of your digital transformation.  

Decide on how frequently you’ll update the broader team on the roadmap and who will be responsible for its project management. 

With all the right people in the right roles, the next step toward ensuring they have what they need to succeed together is a working environment that encourages collaboration and reduces silos. 

Here are some proactive ways to approach this:

Create a Q and A once a month specifically for employees to voice anonymous concerns or ask the CDO or leadership team questions. You could also assign a member of the people team (ideally, one who is also a project evangelist) to host a retrospective meeting, where people can vent or share ideas about improving the process for the next project. Dissent will occur, but it doesn’t need to send shockwaves through your organization. Plan and create outlets for it proactively.

With different plans in place for both sharing and receiving feedback, along with customer data and stakeholder input, your roadmap is bound to change. Work to create an agile environment where people feel comfortable experimenting and sharing their findings. 

To maintain a competitive advantage in today’s digital-first world, many organizations will need a digital transformation. Just as the same strategies won’t always translate from analog to digital, it’s likely your team will also need to change. 

By first figuring out the skill sets you do have, you can begin to determine what’s missing and what hires you need to make. With the right team in place, you can begin your journey toward a successful digital transformation. 

Clear communication, goals, metrics, and a digital-first culture will help get buy-in. A digital transformation is a huge team effort, so company culture and processes will enable effective collaboration as much as possible.

Today, Target is both a household name and a trusted destination for millions of American shoppers.

But, back in 2013, a serious, widespread data breach compromised the personal and payment information of upwards of 110 million Target customers. The breach resulted in a 40% drop in profits for that year. 

This nightmare scenario proved pivotal, as it inspired Target to invest in their digital future. With the start of the pandemic in 2020, they shifted gears once again, reinvesting in curb-side pickup and same day delivery projects they kicked off in 2017. 

Let this serve as a reminder to any retailer, large or small, that there’s always room to pivot and make a comeback. But critically, why wait for a disaster when you can proactively stay ahead of one? That’s why it’s so important to begin developing a framework for a modern digital customer experience (DCX) before something bad, like Target’s data breach, happens to you.

In this article, I’ll share examples of Target’s digital strategy—from centering the customer experience to personalized messaging and pandemic pivoting—that are bound to inspire any customer-centric marketing team looking to level up their DCX.

Top Tip: A successful digital transformation needs a starting point so that teams are aligned on actionable strategies and desired outcomes. Learn how to create a digital transformation roadmap 🐼

Last year, due to the pandemic, a record 12,200 stores closed, according to commercial real estate firm CoStar Group. Those who survived and thrived strategically and quickly pivoted to serve a consumer not keen on leaving their home. 

In other words, they went through a digital transformation. A digital transformation allows brands to serve customers personalized, intuitive, and seamless digital experiences. Even when not on their computer (for example, when a customer is picking up an online order at a physical Target store), the customer’s omnichannel experience is easy and efficient.

Target’s digital transformation in particular allowed them to serve their customers sensitively, efficiently, and strategically. 

Here’s an example of how Target tailored its digital experience to seamlessly fit the circumstances many retailers were struggling to navigate at the start of the pandemic:

This friendly and inviting banner shows customers that it’s still as easy as ever for them to shop (and follow pandemic guidelines) at Target. Once they find their item(s), they can choose between three methods for receiving their order: Pickup, Delivery, or Drive Up. 

To leverage Drive Up, or the ability to place an order, drive to Target, and have your items delivered to your car, customers need to download the Target app. Target was incredibly clever when making this decision, as it allows them to boost app downloads, collect customer data, and thus provide highly personalized and relevant experiences and offers. 

Of course, it’s not enough just to encourage customers to download your app; you need to give them a reason why. By downloading the app, users gain access to app-only features, such as the ability to apply your savings to your purchases when you pay through the app, and, of course, the option to order with Drive Up, use real-time check-in, and sit back and wait for your items to come to you.

Critical to Target’s (and any) digital transformation is understanding the customer journey at every stage. It’s also crucial to be able to adapt to changes in the customer journey as new circumstances arise. 

With the pandemic, more customers were hesitant to shop in-store. Target needed to immediately adapt and include options that enabled customers to shop easily and efficiently without entering a physical storefront. 

Of course, these changes would be impossible to implement overnight. Because of Target’s 2013 data breach and subsequent dedication to its omnichannel experience and software development, much of the infrastructure was in place to make it simple for shoppers to buy online or pick up in person. Nevertheless, their commendable emphasis on the customer journey allowed them to quickly react when that journey drastically changed. 

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As mentioned, Target’s success began before its pandemic pivot. It’s important to note that, especially after the data breach, Target could no longer afford to wait to digitally transform, despite the investment needed. 

But let Target serve as a cautionary tale—not everyone would survive a catastrophic event like Target’s data breach, let alone thrive after one. For this reason, we encourage businesses to think of digital transformation as foundational to a successful future, rather than a “nice to have.”

Target needed to move forward in maturing digitally by developing a framework for a modern digital customer experience. Many brands can relate to feeling limited by an existing infrastructure, not to mention the sticker shock executives may feel when they understand the time and money necessary to rebuild it. But if Target shows us anything, it’s that these investments can, and likely will, pay dividends in your future success. 

Let’s take a look at just what has driven Target’s success to date. 

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Target brought its IT work back in-house after recognizing that outsourced IT projects were costing them a fortune, often ran late, and were of poor quality. 

Additionally, Target provides higher wages and better training than competitors. They raised their starting wages three times in three years, expanded family-focused benefits, invested heavily in training and career-building programs and offer agile scheduling to fit individual needs.

The long-term vision here is to be a sought-after employer, and therefore have more demand for positions so they can select and hire the best talent. This in turn has a direct impact on customers, as happier employees are often highly motivated to provide a positive customer experience.

To offset the cost of higher employee wages and better training, Target increased efficiencies throughout their supply chain. By supporting the warehouse team with robotics and artificial intelligence used to sort millions of products by store and aisle, Forbes reports that this enabled stores to avoid “out-of-stock” situations. 

With machines focused on sorting, humans have time to do what they’re best at—creating connections with customers and providing an outstanding experience. 

Another operational strategy Target has executed well is small store formats. You may have shopped in a City Target, which is often smaller and stocks only items deemed essential to urban life. 

Similarly, in 2018, Target opened 10 “Life on Campus” small-format stores near college campuses. According to Target, their team tailors each store to the needs of its surrounding community. 

Scott Timpani, store team leader at Target’s University Center, University of California Irvine location, explains one example:

“During the school year, about 10,000 students each day cross a pedestrian bridge that starts on campus and ends a few steps from our back entrance. Knowing these guests are often heading to class or simply in a hurry, we have four self-checkout kiosks next to the doors so they can quickly complete purchases and be on their way. And for guests who have more time to spend, we’ve created a cozy seating area near Starbucks complete with outlets for charging their devices.”

Once again, Target shows the importance of deeply understanding the customer journey. And it’s a smart tactic—by embracing young adults away from home for the first time and giving them the items they need, when and how they need them, they’re working to create life-long loyal customers. 

Target has done an amazing job of introducing its customers to new products thanks to partnering with direct-to-consumer (DTC) brands. Many of these smaller brands, such as dog wellness startup Jinx, come with loyal followings. Jinx’s loyal customers get to shop their favorite items with ease at Target, and both brands get to grow awareness by expanding into new markets. 

In addition to working with thoughtful and strategic vendors, Target focuses on customer feedback both in the design process and in selecting brands to work with. Through focus groups and creative apps, the design team can build products and initiatives that delight customers while fueling growth and revenue. 

Another strategic partnership that has fueled growth at Target is Shipt, which the retailer acquired in 2017 for $550 million. The purchase of this online same-day delivery platform accounted for 80% of Target’s digital growth in Q4 2019. Because of Target’s newly optimized IT team, the integration of the technology was efficient and able to show results and sales growth right away. 

With 1,900 stores nationwide, there is a Target store within 10 miles of the vast majority of the US population. This investment in physical stores gives Target a competitive advantage over retailers focusing either solely on a digital strategy or that don’t have many brick and mortar locations.

As with previously mentioned City Target and Life on Campus stores, not only is nearly every American located near a Target, but many are conveniently located to stores relevant to their needs. 

Through rewards, easy navigation of top discounts, and special offers, Target’s digital channels make it easy to become a loyal customer. 

Just like Target unlocks curbside pickup when you download the app, customers must first sign up for a Target.com account before they’re able to join Target Circle. The loyalty program features 1% earnings, exclusive deals, community support, and a birthday gift for members. 

The circle membership feels almost gamified, with chances to earn at nearly every touchpoint. Members can earn points by scanning their mobile number in store, shopping with their Target.com account, linking their RedCard, or scanning a Target receipt. 

In addition to Target Circle, Target has its own credit card, with its own set of benefits (of course, you get the most benefits when you have both). 

Your RedCard provides you with a 5% discount every time you shop at Target (including in-store Starbucks locations), free shipping, even more exclusive offers, and an additional 30 days for returns. 

This sizable, proudly displayed focus on customer loyalty, as well as gifts and rewards, would be enticing for just about any shopper who regularly shops at Target (or who doesn’t…yet!). 

On all of its digital channels (including its e-commerce site, email, and social media), Target makes it easy both to identify what there is for loyal customers to gain, as well as join in and reap the benefits. 

Additionally, you may notice that all of Target’s messaging caters to the customer. This may sound obvious, but as marketers, we know it’s always more important to tout the benefits over the features. Target doesn’t just tell us why we should become loyal customers, it shows us time and again how becoming a loyal Target shopper will benefit our lives. 

On the RedCard landing page, they feature two common pain points that customers face: feeling overwhelmed by how much they spend on groceries per year, and being hit with tons of expenses for a newborn:

By stating exactly how much money you can save in those two scenarios with their RedCard, customers feel like their experiences are taken into account. They feel understood, relieved, and ready to save.

Target has a lot of momentum, and I don’t see it slowing down anytime soon. I mentioned earlier how robots have enabled faster picking and packing, keeping shelves stocked and employees focused on the customer. But that’s not the only way robotics and machine learning (ML) will impact the brand’s bottom line in the future.

Using predictive analytics, Target is able to forecast demand and in-store traffic. As Target CIO Mike McNamara explained to diginomica, “We’ve always had reasonable statistical models in the past, but ML just allows us to become increasingly sophisticated. I don’t know an exact number, but probably about 20% of our replenishment products are through some new ML models that we’ve created.”

In addition to artificial intelligence, customers may soon be receiving their Target orders even faster. Chief Operating Officer John Mulligan recently announced that new distribution centers will be constructed on each US coast in 2022. 

Target has made an impressive amount of progress in the eight years since its security breach. Not only did it overcome every retailer’s worst nightmare, but Target used it as a catalyst for digital transformation and omnichannel success that not even a global pandemic could shake. 

In maintaining a customer first approach to its entire omnichannel experience, Target has excelled at gaining and retaining customer loyalty. I’m excited to see what’s next for the retailer, and I believe there’s much for our customers to learn from Target’s past success, as well as what the future holds. 

Whether your company is looking to improve digital sales or automation, building a roadmap, updating your business model, or striving for optimization or differentiation in a different way, there’s something Target can teach just about every retail business.