Three Companies that Prove Data is Key to Successful Digital Transformation

It’s natural to think of digital analytics as simply one component of digital transformation. While it’s undeniable that data is a major component of digital transformation, we would argue that it’s actually much more than that. Quite simply, analytics is the foundational element of any digital transformation strategy.

In this article we’re looking at three well-known brands that have used data to inform digital transformation strategies that have fueled growth and profits, and propelled them ahead of the competition.

Domino’s Pizza

After years of some pretty catastrophic customer feedback about their product, in addition to slumping sales that led stock prices to plummet to historic lows for the company, Domino’s took a radical approach to transforming their business. They began by confronting issues with their recipes themselves, often being brutally honest with consumers about where they’d gone wrong in the past.

But the company didn’t stop there. At the same time they began pursuing an aggressive ecommerce transformation. Years before you could track your food delivery order through Uber Eats, Domino’s introduced the Pizza Tracker which allowed customers to order and track their pizza delivery online. This was truly innovative technology that placed Domino’s in a league of their own compared to competitors. The company continued to innovate through the introduction of a mobile app and is even now testing drone and autonomous vehicle delivery, as well as AI voice assistants deployed to take orders over the phone.

Rather than doing everything at once, Domino’s ran A/B tests of each new tech implementation in order to make a strong case for its value. The company’s digital transformation was based on a solid foundation of analytics, and today roughly half of the employees at Domino’s headquarters work in software and analytics. In the space of a little more than ten years the Domino’s stock has gone from $3 per share to close to $300 a share.

Starbucks

It’s hard to think of a business more “traditional” than your local coffee shop. Coffee shops are about as brick-and-mortar as it gets, selling consumable products to customers in retail locations. But Starbucks proves that even a business as seemingly sheltered from the winds of digital transformation as a coffee franchise can use analytics to deploy smart technology that improves the bottom line.

After being forced to close hundreds of stores in 2009, Starbucks began taking a data-driven approach to retail locations. They now use analytics to help them identify the best areas to open new locations, based on things like foot traffic patterns and neighborhood income levels.

To get even more customers coming into their stores, and to encourage them to return frequently, Starbucks created its hugely popular Starbucks Rewards app. The app allows the company to personalize offers to customers, thereby driving larger orders and inspiring greater brand loyalty. What’s more, the app offers the company access to a huge trove of data about customers that can be constantly mined to hone and improve customer experience. 

The New York Times

Another traditional business, and one that was predicted to die out completely in the digital age. While it remains to be seen how much longer print editions of The New York Times will be landing on newsstands and doorsteps, it’s clear that the news giant itself has transformed to thrive in the modern media landscape.

The Times realized relatively early on that it had to adapt to meet the demands of digital. While other outlets met the challenge by churning out low quality content to generate clicks, the Times stayed true to their subscription model by putting up a paywall in 2011. In the span of less than a decade the Times built a base of 2.2 million digital-only subscribers.

How did they do it? Data, of course. According to Kinsey Wilson, EVP of Product and Technology at the Times: “It’s been a combination of two things. It’s been really modernizing our data environment, and just our sophistication around analytics, and understanding how the audience arrives at a point where it’s willing to subscribe…. Now, we understand, depending on how often you come, how engaged you are with The Times, what your particular profile is, what’s the next action we can take to make it a more meaningful experience to get you back more often, to drive you closer to subscribing.”

Part of the pathway to achieving that success has involved developing digitally-native content like daily briefing newsletters, new sections like Well and Cooking that feature mobile-friendly content, and the rollout of the wildly popular podcast The Daily, which offers a deep dive into one important story from the outlet every day.

The takeaways

For digital transformation to be successful, it can’t be based on guesswork. A solid foundation of data must inform any plans for transformation. The highly successful transformations of Domino’s, Starbucks, and The New York Times show a handful of effective ways analytics can be used to drive change in even the most traditional industries.