Digital transformation is when companies use digital technologies to modify and create new business processes, customer experience, and culture. It helps meet the requirements of the changing market. However, digital transformation also involves business innovations that improve the stock value and increases revenue.
Several companies have seen effective growth in their business using digital transformation. In this article, we will see some examples of well-known companies that have thrived on digital transformation.
Best Buy – Improved Performance
During 2012, Best Buy saw a significant dip in its revenue and performance. People thought it was the end of Best Buy when Amazon came into play, and even the staff lost their faith in its future. However, the new CEO, Hubert Joly, joined in 2012 and made significant changes to the electronics store.
With the help of Joly, the company slowly turned into a digital leader. Joly brought new views to the company and wanted to enrich their customer’s life using technology. Hence, they moved on from only selling products to a much-transformed brand.
The first change they made was in their delivery channel. Best Buy started a price matching program and focused on selling their products and providing advice to their customers. The staff offered in-home consultations to help the customers make the best use of their devices.
Best Buy started the Geek Squad, which tended to the different requirements customers had at their homes for a flat annual fee.
Another change Best Buy made was transforming from snail mail to a complete digital strategy. They created customer profiles using data which was further used for providing assistance and recommendations to customers.
Even though the path has not been smooth, the results saw a slow but sure change. In 2021, Best Buy started with a $23.70 stock price and is currently around $74. There has also been an increase in revenue from $40 billion in 2017 to $43 billion in 2020.
Target – Digital Transition
Another company that saw a significant change in its digital presence was Target. The company outsourced its web presence to Amazon in 2004. Still, in 2011 they decided to take it back from Amazon as they wanted to use their digital presence as their primary business piece.
To do this, Target invested in a new and remodeled design for more than 400 of its stores. They equipped the stores with newer technology along with introducing in-store pickup and online orders. By doing this, Target wanted to combine its physical stores and e-commerce.
The remodeled stores also provided curbside grocery pickup. Several new aspects are based on the D2C (direct-to-customer) model. Target did this by putting up pop-ups that sold exclusive items from well-known brands.
Another aspect that Target focused on was its social media presence. Using their social media handles, the company made people aware of their new products. They even gave customers the provision to buy their products directly using their social media handles.
Target hit their lowest in 2006, from where they saw a significant change. The company started with approximately $73 per share in 2017, which saw a drop in the middle of 2017 to about $53. However, the stocks have seen steady growth and are currently valued at about $88.
Target has also seen an increase in its revenue, starting from $70 billion to $76 billion approximately. The company is on its way to remodeling more of its stores, and they do not plan to stop anytime soon.
Home Depot – Retail Digital Transformation
Home Depot started as a hardware store and did quite well in the market. However, during 2017, the company vouched to invest more and invested around $11 million to enhance their IT and data departments. Home Depot, just like Target, wanted to combine their physical and e-commerce shopping experiences.
Home Depot started by hiring 1000 user experience and IT professionals. They wanted to charge the customer’s shopping experience. Earlier customers had to move between aisles to find the product they wanted. That took up a lot of time and lowered customer experience.
With the new digital transformation, customers no longer have to visit the physical store to shop for their products. Instead, customers could shop online and have the products delivered to their given location.
Home Depot wanted to develop a seamless experience for their customer with this transformation. They enhanced the delivery channels and provided the best resources to their customers.
The company’s investment was focused on building up its distribution and back-end channels. They also wanted to get a better understanding of their customer’s needs.
With the change in digital transformation, Home Depot was able to save money on excess inventory. They tracked the local trends and stocked on items that were in demand. Customers were also given the option of voice and visual search on the Home Depot application.
Customers can now search for the products they want without being overwhelmed. Their stocks started at $135 in 2017 and are currently at $215. They also saw an increase in revenue from $93.3 billion to $110 billion.
Hasbro – Business Innovation
Hasbro, a toy and game manufacturing company, saw its market share slipping in 2012. They needed to enhance their sales, for which they turned to improved digital strategies. Hasbro started by gathering customer data and using them to create targeted marketing programs.
Instead of focusing on the children, the company realized that they would do better if they focused on marketing to the parents. That is because the parents were the actual customers since they made the buying decisions. Their data helped them better understand the customers’ needs and recommend suitable products for the parents.
Hasbro also created video content that they spread through their social media channels. It was part of their digital storytelling that had a great impact on their customer base.
The idea was to improve their relationships with the customer. They did this by combining nostalgic traditional brands with modern channels. This omnichannel marketing helped the company push its range of products to the customers while improving customer relationships at the same time.
Even though the change required high investment, they saw a huge change. Their ad sales increased by 1100%, which showed an increase in sales by $1 billion. Hasbro sold stocks worth $36 in 2013, but currently, it is valued at $109.
Nike – Digital Enhancement
Nike is a brand that everyone recognizes and has a big hold of the sportswear market. However, the clothing and athletic shoes brand felt they could reach out to more customers if they changed their operations. The management decided to go for a digital transformation in different aspects of their business.
Nike focused on transforming its brand, mindset, and supply chain. It was focused on creating an identity that would help them connect better with their customers. The company brought some serious changes in their digital functionalities.
They developed better digital marketing campaigns, updated their e-commerce strategy, and adopted enhanced data analytics. Furthermore, the company also transformed its direct-to-customer sales.
To carry out all these functions efficiently, Nike opened concept stores and built up their memberships. They also made changes to their app to improve the online shopping experience of their customers.
The change removed any intervention of mediators, which was initially making their operations sluggish and outdated. They further created a partnership with Amazon to create a direct e-commerce strategy. The idea was to sell to the customers directly without depending on vendors.
The change in their digital focus helped Nike grow faster in the product development cycle. It allowed them to bring new products into the market within a very short span. Furthermore, Nike developed control over their production and set trends in the market.
Nike started with a $52 stock price in 2017, which is currently valued at $88. Their revenue also increases during this time from $33.5 billion to $39.1 billion.
Honeywell – Tech Giant Transformation
Honeywell is a tech giant that helped several companies enhance their digital capabilities. However, the company did not pay much attention to its digital presence. With time, Honeywell realized the potential for a good digital presence and shifted its focus entirely to building stronger digital campaigns.
The company started by changing its focus from quantity to quality. To initiate this, they decreased their industrial end markets to six from eight. The company also started searching for ways that would help them leverage digital solutions.
Apart from changing their own digital presence, the company also helped customers using acquired data. Honeywell formed their Digital Transformation unit in 2016. They initiated new technologies that included IoT devices and other advanced technologies.
The streamlining and digitizing helped the company form better relationships with its customers. They were also able to meet the demands of their customers using the collected data. The company has seen incredible growth in terms of its digital strategies.
Honeywell offered enhanced technological solutions to their customers and also reinvented industrial process control. However, they did not stop at that and committed to changing their market using more digitalized resources.
Even though the company went through its fair share of ups and downs, it did not stop or change its direction. Slowly Honeywell started seeing a drastic change in their stock value and revenue.
The company has stocks valued at $95 per share which grew to $174 in four years. Furthermore, the revenue grew from $40.3 billion to $43 billion.
Microsoft – Business Innovation
Microsoft is a brand that does not need any special introduction. They are widely known for their innovative products like Office Suite, Windows, etc. However, the company started receiving intense competition from Amazon, Apple, and others, affecting their stock price.
Due to this dip in its stock price, the company decided to change its business strategy. They developed a cloud networking system that would make their business more forward-focused. The shift from traditional software to a cloud-based system helped them gain more traction in personal and enterprise scenarios.
Microsoft partnered with other software and technology companies to fulfill its vision. This change was seen from 2014 onwards when the new CEO, Satya Nadella, took over. He wanted to change the view of the public towards the brand.
With this change, the customers started to appreciate the modern touches in their operations and products. Hence, Microsoft was slowly changing its image of being a traditional, stagnant, and outdated company.
Furthermore, the partnerships with other businesses were for their vision and to build new connections. Earlier Microsoft refrained from partnerships which slowly took a toll on their stocks and revenue. However, with the new partnerships, there has been a significant change in the company’s functionalities.
Microsoft’s stocks were being sold at $38 per share before Satya Nadella took over in 2014. However, currently, it is being sold at $136, which is a huge increase. Furthermore, their revenue also saw an increase from $93.5 billion to $122 billion.
The business examples shown above are just a few out of the many businesses present in the market. However, these examples show how digital transformation can drastically change the face of a business.
With proper digital strategies, a company can increase its revenue and stock prices and develop better customer relationships.
Companies can adopt modern functionalities and innovations, which helps in their growth. Even companies who are at their lowest points can see a significant change with proper digital transformation campaigns.