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Digital strategy deconstructed: key considerations, part. 2

This is the second part of a few, deconstructing and highlighting some important aspects of the concept of digital strategy and what to consider when approaching it. You’ll find part 1 here.

Part 1 was much about the power of words and definitions, and the need to actively reflect on this with the group responsible for thinking “digital strategy”. It also highlighted the power of using a networked perspective for understanding the integration, organisation wide implications as well as stakeholder alignment.

In this second part I’d like to touch on how brand culture and purpose matters greatly, and how reframing this, and ones market, creates a vantage point that fuels the thinking. I use two fairly well known examples to do this.

Ford manufactures cars, but a while back they redefined themselves as a mobility brand (actually, the original mission was to make America mobile, so not that drastic change…). What does that do? Obviously that depends. But there’s a number of things that fit very nicely together in business strategy, but I’d like to include it in digital strategy as we define that as broadly as strategic thinking in a digital (networked) world.

The mobility brand Ford saw the number of 16 year olds who get their first car drop considerably. More numbers are showing the same changes in demand. But if you’re not in the business of selling cars, but rather mobility, there’s another side to that.

Ford partnered with Zipcar which offers a subscription based model for access to mobility, in the form of cars. This could have been done without Zipcar. It is now done in different shapes and forms by many car manufacturers (I recently saw that Audi pushes micro-sharing experience, collective access to Audi cars)

Zipcar bought by Avis, but what if Ford bought it? Making money from providing mobility services in Volvos, BMWs etc? Competitors become collaborators. The revenue model drastically different. Not switching, complementing. All facilitated by new, networked, technology. But, more importantly: new self perception on behalf of the brand. The organisation, and how everyone sees value creation.

Slideshare: Part 2 touches on slide 5-7

reframing the market and the business

Product development vs business development. A networked perspective can dramatically fuel the thinking in business development. Looking at the brand, its purpose and meaning in peoples lives, is an important part of digital strategy. It might make it inseparable from business strategy, that’s fine. That’s actually just right. And here’s also where it becomes something bigger than a digital thing. That’s important, because when it’s a business matter, and even a cultural matter, you (still) have a better shot at getting more people excited and onboard.

The vast majority still don’t feel ”digitally savvy” and hence exclude themselves from ”digital” projects. Many are literally scared of it. But cultural transformation, processes, thinking about markets and business – there’s where you might find those people.

I’ve jotted down some thinking on meaning markets before. In the case with Uber, on slide 6, they think of themselves in a number of ways appart from ”taxi company”. One is as a logistics platform. What makes sense when you’re a logistics platform? Partnership with destinations. An open API. Revenue sharing between company and private drivers carrying out the transportation. All of the things that any taxi company could have done, but didn’t. Because their culture, self-perception and view on value creation, doesn’t allow for it. That’s right, it doesn’t allow for it. That’s how strong impact culture has on ideas. It’s back to definitions in a sense.

  • Always include, and even describe, your digital project/initiative as a (organizational) cultural one. You benefit from appealing to people who dislikes and even fear digital.

  • Rethink your market. Do the product vs. meaning exercise. What is your product? What is the meaning of you, and that product/service, in peoples’ lives? Then think about what your market really is. I’ve heard Unilever is very much in ”home care”, aiming to ”free up family time”. So how about a global platform for subscription based home-cleaning, laundry service, laundry pickup etc?

  • See also a method called Jobs To Be Done. This is not equating an initiative around digital strategy with innovation, but it is highlighting the perfect occasion for truly taking a stab at preemptively exploring ”how the business might change”.

OK. So two posts in and still no focus on media channels, social platforms and communication. I don’t think the next one will be either.

Meaning based brand development

For quite a while, I’ve been using Ford as an example of a brand that’s redefined itself (or rather refocused) from car manufacturer to what they refer to as a mobility brand. I think it makes all the difference.

What they did early on was team up with ZipCar on US campuses, getting young drivers (note; drivers, not car owners) to get into Ford cars. Stats on that car selling challenge here. Now, of course the meaning with owning a car is transportation and mobility (not taking into account the, to be honest, not so small addition of signalling something about you as a person, which I think sits equally much in what you choose to drive and not just what you own). Hence a new business model. You may come from manufacturing and selling Ford cars, but that’s not necessarily the business for ever after. If Ford viewed their meaning market like Avis do (Avis bought ZipCar), they’d step past the competition by way of a business focused on getting people transportation – whether that’s a BMW, Volvo, Ford or whatever car brand. Potentially pretty drastic from a scaled up business model perspective .

Envisioning freely what Ford could be doing and what the larger meaning market could be, and what offers and services fit in, you touch on selecting models and vehicles. So I’m always thinking why not be able to buy the sporty one – but get 5 free rentals a year for when the family needs a larger vehicle for soccer games or something like that. You know, bake that in as the augmented product. Relieving difficult choices, in a way. Because it’s not about buying a car, it’s about transportation, mobility – even family logistics, when you think about it.

So now I found this similar offer/service/nudge from BMW to make the decision of buying the i3 easier. Good one.

The exercise of thinking Product (category) vs. Meaning (value of the (bigger/multiple) market(s)) is one that I stress every brand and organisation to do in a recurring manner. It sits in the project/process/challenge of figuring out the digital strategy, mind you. It’s because technology and digital, if we allow ourselves to refer to it as loosely as that, is driving societal changes. That means what you do, who you are and how you do things – can, and will, drastically change. Meaning your basic existence is the topic. That’s a cultural question, not a technical one. And that, dear reader, is the most importan distinction to be made when getting an organisation of not-so-tech-interested people to start pulling in the same direction. To feel ownership in a question that they, hence, understand and grasp (culture and meaning as opposed to that “digital stuff”).

I use meaning* and not purpose. I might seem like semantics but I think the two are distinctively different. With brands defining their purpose, I think often we see an inside/out perspective still lurking there. It’s our purpose (for us) vs. the meaning (for users). Meaning is about the new markets (and business ideas, models and revenue models) that can be identified and that may not resemble anything your used to from before (scary). The value they provide and generate. Purpose is centered too much around a statement about the brand and doesn’t get “verbified” as well.

Have you phrased, framed and begun the cultural transformation that is the result of technological change yet?

* I am aware that if you are looking at the word meaning in the context of brands and consumption, we also have another definition in the consumer culture research discipline. I use meaning markets more in a business development sense, where function/utility takes precedence over the development of signaling powers of brands, although the two are intertwined.

A Ted Talk where Bill Ford Jr shares some thinking on the future of transportation and mobility (2011).




language hinders you from creating for your meaning market

There are product categories and then there are meaning markets. Well, to me there is. I keep coming back to the importance of brands thinking about themselves as having meaning in a greater context. What is the meaning with us? Of course viewed from the other side it’s about what value do I (user) get out of them (brand). And when corporations can ask themselves that question from the perspective of a consumer (customer centricity) is when you start seeing opportunities within a/your meaning market.

Product categories are limiting. Ford as a car brand? Then go ahead and invent better cars (and product innovation is of course needed). Ford as mobility brand? Then it makes perfect sense to team up with (hell they could have started it) Zip Car and help sell transportation by the hour to consumers used to buying music by the song, as Gretchen Effgen, of Zipcar, put it a while back. Joint miles program with air line? Why not.

In digital transformation (i.e. business transformation, mind you) – definitions, perspectives and self perceptions makes all the difference. This, by super smart Deborah Mills-Scofield, I liked:

“There is a balance between using the past to understand the present and guide the future, on the one hand, and on the other, creating something fresh that leaves the old behind. We need analogies to understand the new (eg, horseless carriage) yet they also hold us back by it constraining our thinking (eg, horseless carriage).”

– Deborah Mills-Scofield, In HBR

And if you think that’s only about semantics and words, here’s the knock-you-straight business version from Peter Drucker.

“The greatest danger in times of turbulence is not the turbulence; it is to act with yesterday’s logic.”

Almost all clients I’ve come in contact with and in any way consulted in digital transformation, whether tactical or strategic, the issue has sat there. Definitions. Definitions reinforced by legacy. This keeps you distanced from the future. Regardless of how evenly or unevenly distributed it might be…