Generative AI has taken center stage in virtually every business article, LinkedIn post and cocktail party conversation. And for good reason – ChatGPT drove one million users in its first five days, turning the technology into a household name and transforming how businesses think about productivity and efficiency. For marketers getting their heads around it and starting to experiment, the potential can be either daunting or inspiring.  

Marketers have always been at the forefront of technology. AI and machine learning have been critical in shaping programmatic buying, lifecycle marketing and digital experiences. And for many marketers, this isn’t the first shift they’ve experienced within their role. 

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A Framework for Supercharging Your Marketing Efforts With AI  

It’s helpful to think of AI as a tool to help enhance what you do as a marketer, especially when it comes to thinking about customers and their needs. Here are four ways marketers can use AI to show up for their customers in more connected and cohesive ways:  

Unlocking Understanding 

Many AI-driven models excel at analyzing unstructured data, text, images, videos and other content that does not fit neatly into traditional databases. Typically, this type of analysis is time-consuming and expensive, requiring its own algorithms. 

Marketers can use AI to help analyze large volumes of data, recognize complex patterns, explore and visualize data, perform predictive analytics and provide real-time insights to drive more personalized and optimized marketing strategies and tactics.  

Companies like Amazon, Netflix, Meta and Alphabet are far ahead of the curve. But so are non-tech players, such as Johnson & Johnson’s Neutrogena and JP Morgan Chase. All using AI to analyze data and use it in ways that directly benefit customer experience.  

Unlocking Value 

AI automates repetitive and time-consuming processes, reducing the number of daily tasks, and freeing up hours so that marketers can focus on higher-order priorities that require more strategic, human thinking. Smart marketers are learning ways to turn those found hours into new initiatives, liberating marketing teams to find new avenues of growth. 

Adore Me, the e-commerce lingerie company recently acquired by Victoria’s Secret now uses AI to churn out hundreds of product descriptions. While copywriters still need to read, tweak and occasionally edit the blurbs, it estimates it saves up to 40 hours a month per copywriter, with zero impact on sales. Even better? Copywriters hated writing those tedious descriptions. By delegating that work to AI, they can focus on higher-order campaigns that drive additional revenue. 

Unlocking Creativity  

With more marketers being asked to do more with less resources, AI can be an essential tool. It can help reduce the time it takes to generate creative concepts, create visually appealing and engaging content, facilitate brainstorming processes, and draw insights from past campaigns that can help marketers take personalization to the next level for future campaigns.  

Lexus, for instance, used AI to transform its Auto Show experience this year, inviting attendees to enter prompts that quickly personalized their new cars on a 98-inch screen. And political attack ads using AI-created voices of opponents are already reshaping the upcoming election cycle. 

Unlocking Differentiation 

With its speed of processing data, sifting through customer insights and analyzing competitors, AI can suggest gaps in the market to help companies create personalized, innovative and differentiated experiences that cater to specific customer needs. 

For example, Unilever uses AI to explore the human gut, home to trillions of bacteria. Using big-data biology, the company is isolating the microbes with the most calming potential and experimenting with biotech partners to pinpoint food and beverage ingredients that will have the most positive impact on mental well-being. Its Knorr soup division, recently used AI to analyze millions of flavor combinations in days rather than months, using digital modeling to create a zero-salt (but still delicious) soup cube.  

To maximize success with AI it’s important to remember that AI is more useful when it is centered on human needs.  

Creating an AI-Readiness Checklist  

Marketing organizations must also have the necessary data capabilities to implement and operationalize AI effectively. Those include thoughtful attention to:  

Data Foundation: Quality Over Quantity  

Companies must have high-quality, first-party data stored in secure infrastructures with clear, consistent taxonomy that can be processed at a high volume.  

Best Practice: Focusing on securing quality information rather than rushing to get the biggest datasets fast will prevent future inefficiencies and accuracy problems. And despite the focus on large-language models, it’s important to note that many tech companies are experimenting with smaller versions, which may be more accurate and efficient.   

Data Value Exchange: Upping the Ante  

Companies must offer additive products and services for customers in exchange for their data and provide transparency for how data will be used.   

Best Practice: In a world where AI tools are accessible to all, companies can offer trust and respect for privacy as a differentiated yet still personalized experience to customers.   

Data Culture & Fluency: The Heart of AI Transformation   

Companies must pursue broad AI fluency across the whole enterprise as well as invest in specific data and AI expertise to continuously innovate.  

Best Practice: Without the people to understand and strategically use AI at all levels of the organization, companies will not be able to unlock uncommon growth.  

Fully implementing AI will require proper evaluation and tracking against an adoption timeline. As soon as possible, begin incorporating AI into workflows, explore opportunities for sustainable optimization and continue to scale it.   

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In this year’s State of Digital Transformation report, we set out to identify the key differences between the businesses that are succeeding at digital transformation, and those that are still struggling. We surveyed over 600 executives from North America, Europe and Asia across a range of industries to highlight not only their current digital capabilities but the key investments and choices they made that got them to where they are today. By separating the responses of high performers and average performers, we identified key characteristics of companies that successfully met their transformation goals. 

This report serves as a benchmark for what digital maturity looks like in 2023 and charts a path forward for businesses that are looking to drive growth and thrive in the next wave of digital transformation initiatives. 

Key Takeaways:

• The majority of companies (45%) chose business growth as their top goal for digital transformation, followed by innovation (45%) and efficiency (42%). 
• Top-performing companies tracked metrics like innovation (36%) and digital literacy (32%) to measure digital transformation success, while average performers tracked business performance (42%) and efficiency (40%). 
• Limited budgets (34%) and a resistant culture (27%) were the top obstacles to digital transformation success. 
• Despite challenging economic times, 42% of digitally mature companies were accelerating their digital transformation efforts this year. 
• Top-performing companies were more likely to have their digital transformation led by the CEO (33%), compared to average performers where the CIO or CTO (36%) were more likely to be in charge. 
• The top transformation priorities for companies were upgrading technology (50%), achieving operational efficiency (34%) and getting more value from data (32%) 

Through their digital transformation investments to date, banks have built impressive launch pads for uncommon growth but most have yet to fully take flight. That’s the main takeaway from The 2021 State of Digital Transformation research from Altimeter, a Prophet company.

This post highlights the findings from Altimeter’s research on the banking industry – where it is today, how it compares to other industries and future priorities. Despite the potential to generate stronger returns on their digital investments, banks have typically been ahead of their peers in other sectors. In fact, we expect that banks will be among the first firms that shift the conversation away from digital transformation and toward ongoing digital fitness and digital value propositions.

Digital Transformation in Banking

Banks Prioritize Innovation and Gear Up for Increased Demand for Cybersecurity and Cloud Tech

Banks bring particular strengths to the game of transformation. For instance, banking respondents indicated that their firms have more mature data management practices than firms in other sectors. That’s no surprise, given the industry’s focus during the last decade on building out such capabilities.

Still, there is plenty of room for improvement. Notably, banks have achieved only average maturity in data science, suggesting that they can do more in exploring data and converting it to actionable insights. It seems that banks have figured out the mechanics of capturing, storing and retrieving the data, but are still working out how to best use that data to win.

The insights generated by skilled data scientists will be essential to developing the next generation of digital products, a top priority for banks. Indeed, banking respondents were more likely to cite “innovation and new products/services” as the top goal for digital transformation, compared to other industries. In contrast, transformation investments in other sectors were focused on replacing outdated tech and cutting costs. The implication is that banks have already realized those first-order benefits by digitizing many processes, though they are still pursuing innovation and higher degrees of customer-centricity, a topic we explore in greater detail in our research report Executing on Customer-Centricity.

Banks were also rated as highly mature in customer journey mapping, a foundational capability that sets the stage for innovation in product development. Our research showed that banks are more advanced than their peers when it comes to digital marketing, suggesting banks can successfully execute their go-to-market strategies once-innovative products are ready to launch.

Cybersecurity and cloud platforms were the top areas for future technology investments for the industry. Strong protections against data breaches are essential as banks try to digitize every aspect of their operations and prepare for likely new data privacy regulations. The good news is that cloud migration can help strengthen security, provided banks take a strategic approach and engage the right partners.

Digital Growth and Value Creation Opportunities in Banking

Building on the strong foundations – or launching pads – they’ve built through digitization, banks can take on bigger, bolder and more creative innovations. Yes, digital must be optimized as a channel, both for servicing and marketing, but banks must go further, rethinking the very definition of a product for the digital age.

Tomorrow’s top products will be those that combine multiple components – interest rates and credit access, rewards and discounts, security and protections, tailored experiences, relevant and value-adding content, software and algorithms – in ways that singularly meet the needs of individual consumers. The most successful products will be so frictionless and intuitive as to seem magical.

“Tomorrow’s top products will be those that combine multiple components.”

More holistic offerings keyed to life events and “moments that matter” (e.g., buying a home, saving for college or planning for retirement) will certainly be part of the solution. People will choose banks that can help deliver greater financial security and confidence, not just free checking and cash-back credit cards. No bank has yet executed such a vision at scale, but those firms that succeed at digital transformation (whether they are traditional banks, fintechs or super apps) will have a head start.

Innovation is as much a question of how as it is of what or why. Banks have the technology they need to innovate with new products and services. But actually, developing such offerings requires greater synchronization and internal coordination among different functions and product lines. Banks that simultaneously transform departments and align them to overarching strategies will achieve the digital interdependence necessary to launch an entirely new business and operating models (e.g., ecosystems).

These changes won’t be easy. Breaking down organizational barriers, reworking incentives and compensation structures and re-aligning profit-and-loss accountability are extremely difficult. However, for banks in 2022, these changes are imperative to prepare for the customer-centric future that’s taking shape across banking.

Follow Their Lead: Three Digital Lessons from Banking Winners

Our study’s findings also highlight a few specific practices embraced by banks that are farther along on their transformation journeys. The following actions can help banks prioritize investments and next steps in line with their strategic objectives.

1. 1. Design transformation programs for innovation and growth. Prioritize new product development and experience enhancements over simple process streamlining, automation and cost reduction.
2. 2. Formalize innovation programs. Set outcome targets based on structured processes and timelines, use benchmarks and metrics to standardize funding models and clearly define testing protocols.
3. 3. Explore data for actionable insights. Unify and explore data sources to produce richer customer insights that extend across product lines (e.g., mortgage lending, private banking) for personalized offers and more precise segmentation (e.g., based on lifetime value).

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In January 2022, the world will have been two years into a devastating pandemic, and businesses will be coming to terms with the permanence of its impact.

“After the successive eras of disruption that happened with social media, cloud computing, mobile and AI, we’re now poised to prepare for the next big one.”

As our research has shown, COVID-19 accelerated digital transformation at an unprecedented pace as companies scrambled to build better digital experiences and virtual presences, and to update aging software platforms to meet the demands of the new pandemic-era customer. We’re now entering a period where there is an uncharacteristic lull in the digital transformation world. Companies that successfully survived and thrived in the COVID era are pausing to take stock of what’s next. And companies that struggled are in the last laps of catching up. After the successive eras of disruption that happened with social media, cloud computing, mobile and AI, we’re now poised to prepare for the next big one.

Altimeter’s trends this year might not have the definitive prediction for the next big disruption. But we do have a few clues about where things are going, and we’re placing our bets on seven digital trends that we think are harbingers of the next era of digital transformation.

1. Environmentally-Friendly Marketing

We know that consumers today expect the products they buy to be ethically produced in an environmentally-friendly way, by businesses that value diversity and inclusivity.

However, it’s not just the products—today’s consumers also expect the same values from the marketing campaigns that sell to them. A recent survey from Microsoft and Dentsu found that 77% of consumers only want to spend money on brands that practice green and sustainable advertising. A few ways brands can do this include: pivoting digital spend to low/no carbon providers and shortening the journey from the data center to the audience; creating OOH posters with recycled paper; using ‘carbon eating’ paint for murals, or incorporating elements of search spend in platforms offering carbon off-setting.

2. The Data “Have-Nots” Fight Back

It’s true that companies have access to more customer data than ever before. But when you think of actual data that companies own, it’s nothing compared to the companies that ACTUALLY have access to all the customer data in the world. We’re talking about Google, Meta, Apple, Samsung, Netflix, Microsoft. The sheer scale of customer data owned by these companies dwarfs anything that an individual company owns, and as a result, there isn’t a business out there that can hope to reach and analyze its customers without these giant collectors of customer data. And for years, they have made their billions by providing access to that data at increasingly premium rates.

So it’s clear we live in a world of data “haves” and data “have-nots”. And the “have-nots” are thinking of ways to fight back. Companies are investing in building their own digital properties and filling them with their own content to keep customers engaged and generate accessible data. They’re also partnering with other companies to pool their data resources on common customers (think airlines sharing customer data with credit card companies or hotels). This won’t end our reliance on the big data companies anytime soon, but it does give companies a fighting chance when the data access rug gets pulled out from under them—either in the form of greater government regulation, or increasingly cost-prohibitive conditions for access.

3. Taxonomy is Trendy

Speaking of the proliferation of data, most companies don’t know what to do with it. After years of investing in access to all kinds of customer data generated from their own digital platforms, digital devices, customer surveys, advertisement networks and third-party marketplaces, businesses are now spending their resources on sorting into actionable categories. And it’s not just data — companies have had to exponentially scale their production of content to meet the increasing demands of personalized, channel-specific content for a variety of customer segments. This means creating a clear system of categorization for tagging, storage, access and reuse, providing a need for taxonomists to bring order to any marketing function that is serious about running large-scale, personalized digital campaigns.

4. The New “Converged” Go-to-Market Function

A key learning from our most recent report on The State of Digital Transformation was the increasing convergence of marketing, sales and service teams (i.e., our “go-to-market” function). We found that the majority (54%) of companies have shared targets for customer satisfaction and revenue, with half of them even sharing cross-sell and upsell goals across those three functions. Additionally, we found that 80% of companies were now operating off a unified customer journey that plotted digital interactions with the customer spanning across marketing, sales and service touchpoints. All of this points to an increased convergence between these previously separate functions. That means greater sharing of data, more transparency in collaboration, and even unified leadership in some cases. While we expect specialized practices in each of these functions to continue, the trend towards a highly collaborative “uber” team across marketing, sales and service is a compelling one.

5. Formalizing the Future of Work

If you’re a consultant specializing in the future of work, this is your time. COVID-19 has permanently changed the way we work, and in some ways, it has even fundamentally altered the perception of what work is. Any company that doesn’t accept that reality is in denial. In 2022, we can expect to see wholesale changes across industries, including hybrid work, new environments and software for collaboration, different incentive schemes for employees, and a transformation of traveling for work. Things (at least at work) aren’t going back to the way they used to be and companies are realizing that the temporary measures they took must now be formally incorporated.

6. Brands Make Bank with NFTs

It’s entirely possible that cryptocurrencies and NFTs are one giant bubble inflated by finance and VC bros who are facilitating a giant wealth transfer from late adopters to early adopters. Having said that, you can still count on brands to take advantage of the trend, and there’s a big incentive to jump on the bandwagon early. Adidas recently dropped a collection of NFTs, in the form of digital artwork (pictures of…apes?) that netted the sportswear brand $23 million. And digital art is only the start. Nike is experimenting with NFTs for virtual shoes (yep…shoes that exist only in the Meta-verse) and other brands are experimenting with NFTs that link to real experiences, such as a token that provides entry into a community or exclusive club.

7. Prepare for the Meta-Verse

All this commerce in the NFT space is based on a giant bet being made on the creation of the “Meta-verse”. Put simply, the Meta-verse is going to be an interconnected collection of virtual “worlds” where you (or your digital avatar) can work, play, create, transact and socialize. It’s the natural evolution of the things we’re already doing online, but in a far more immersive way (you access it through virtual reality). Furthermore, your identity (and a record of the things you own) will exist on blockchain technology which makes it harder to falsify or be hacked. A few months ago, Facebook publicly pledged to be at the forefront of building the Meta-verse, famously renaming itself “Meta.” And there you have the beginnings of “Web 3.0”.

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Altimeter, a Prophet company, recently launched the latest edition of its flagship report, the 2021 State of Digital Transformation. The report was compiled from the results of a survey of 587 executives from the U.S., Europe and China, across a range of industries, to uncover current digital capabilities, key investments and decisions made to advance transformation in each business.

What can companies in China take away from the findings? In this article, we included key learnings about the state of digital transformation among Chinese companies and compared them with global “high performers” as a way to inform a path forward for the next wave of digital transformation.

An Aggressive Focus on Innovation as the Top Reason for Digital Transformation

Globally, innovation was among the top reasons for investing in digital transformation, alongside core business growth and operating cost reduction. High-performing companies were more likely to cite “core business growth” as their top goal (57%), compared to average performers, who were far more focused on reducing operating costs and updating technology.

Figure 1: What were the top reasons for your company’s investment in digital transformation?

Chinese companies have a more offensive mindset toward digital transformation, as we see an even higher focus on innovation for new products, services or business models (66%) compared to the rest of the world (48%). Moreover, China’s highly competitive and dynamic market landscape has driven companies to put a greater emphasis on competing with newer businesses and products in the market (46% of Chinese companies compared to 33% of companies in other countries).

In contrast, fewer Chinese companies are investing in digital transformation to replace outdated or obsolete technology (18% of Chinese businesses compared to 41%  of other businesses around the world), as they are less likely to have legacy issues when it comes to internal technology.

An Incubated Transformation Approach Versus a Holistic Approach

The great majority of studied companies (68% of businesses in other countries) already orchestrated digital transformation programs as a single coordinated effort that simultaneously spanned many departments or functions.

Figure 2: Which approach best describes how your company implemented (or is currently implementing) its digital transformation program?

Chinese companies approach digital transformation differently. More companies use an “incubated” approach (50% of Chinese companies compared to 15% of companies in other countries) – meaning their digital transformation starts at one department or function at a time and has yet to become an enterprise-wide agenda.

This is not entirely surprising, because when Chinese companies start their digital transformation, they often focus predominantly on consumer-facing touchpoints such as e-commerce and digital marketing. And many of their efforts are working with the ecosystems of tech giants, e.g., Alibaba, Tencent and Baidu. Being able to leverage these established ecosystems is both a benefit and a risk. While it enables companies to jumpstart their digital transformation journey, it also often creates inertia of a broader enterprise-wide transformation.

“Chinese companies have a more offensive mindset toward digital transformation, as we see an even higher focus on innovation for new products, services or business models.”

Learning from global high performers, leaders at Chinese companies need to seize the opportunity of adopting a “holistic” approach to innovate and grow better. It takes bold moves, but the payoff will also be enormous. For instance, Anta Group has undertaken digital transformation across consumer insights, product R&D, logistics and online/offline channel operations, enabling it to outperform Nike for the first time in the recent 11/11 sales season.

Transformations Led by the CEO Are More Successful

In China, more companies consider digital transformation as a top strategic priority by executive leadership (44% of Chinese companies compared to 27% of companies in other countries). Executives also connect digital transformation to higher business strategy objectives to create a strong mandate for the efforts.

However, given the orientation to an “incubated” approach, about half of the Chinese companies (46%) indicate their digital transformation activities are led by CIO/CTOs, and 14% chose CMOs compared to only 3% in companies of other countries. This demonstrates that technology prowess and marketing competencies are viewed as key pillars for digital transformation in China. However, these companies still lack a top-down vision and purpose that drive their digital transformation agenda, which can only be led by the CEO.

Figure 3: Which executive officially owns or sponsors the digital transformation initiative?

Our global data has shown that companies with successful digital transformations were much more likely to have their transformation led by the CEO (34%). The CEO (supported by a forward-thinking board of directors) can devote resources and oversee a holistic transformation, rather than letting functional roles such as a CIO, CTO or a CMO drive it. These executives, while individually empowered, will always be limited to the transformation of their own departments, and not as well equipped to deal with the converged transformations between departments and functions that are increasingly the norm.

Leaning from what global high performers have achieved, Chinese companies need to drive more convergence between sales, marketing and service goals. Although Chinese companies have a much higher focus on digitalizing their businesses through e-commerce, many haven’t integrated sales, marketing and service for their overall online and offline businesses. If CMOs continue to be tasked to drive digital transformation initiatives, we believe that the role of CMO should be broadened.

Emphasis Needed on Both CX (Consumer Experience) and EX (Employee Experience)

When asked about their priorities in digital transformation, companies in China prioritize business model and market value proposition update (42%), customer experience (36%), processes and efficiency (34%), modernizing IT infrastructure (32%) as well as external and ecosystem partnerships (30%). However, they are investing less on improving the employee experience in comparison (20% of Chinese companies compared to 32% of companies of other countries).

Figure 4: Which of the following initiatives did you prioritize first for your digital transformation program?

This gap is widening as COVID-19 created a stronger urgency for companies around the world to accelerate EX improvement., except for  Chinese businesses, which have largely returned to normal since May 2020.

We’ve also found that across the world, high performers were more likely to have invested in improving both CX and EX as priority initiatives, a consistent hallmark of successful companies in our study. It highlights how top performers are using transformation to serve their most important people, rather than simply modernizing for the sake of keeping up. Chinese companies need to catch up.

However, there could be a silver lining, as a reckoning is happening on work culture, as the younger generation in China pays increasing attention to work-life balance, purpose and sense of belonging at work. Leading Chinese companies should start to focus more on EX when investing in digital transformation.

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Omar Akhtar, Senior Analyst and Research Director at Altimeter, Chan Suh, Chief Growth Officer at Prophet, and Jacqueline Alexis Thng, Partner and ASEAN Lead at Prophet, present key takeaways from Altimeter, a Prophet company’s flagship report, The State of Digital Transformation – which surveyed nearly 600 executives from the U.S., Europe and China.

Our expert speakers discuss key trends in transformation, as well as how companies in China approach digital transformation differently compared to other countries, providing important insights for businesses in Asia.

If you’d like to learn more about Prophet’s approach to digital transformation, get in touch today.

Omar Akhtar, Senior Analyst and Research Director at Altimeter, and Chan Suh, Chief Growth Officer at Prophet, present the biggest takeaways from Altimeter, a Prophet company’s flagship report, The State of Digital Transformation – which surveyed nearly 600 executives from the U.S., Europe and China. They discuss key trends in transformation, including where leading companies are expanding their digital capabilities, what investments they are making and common roadblocks they encounter along the way.

If you’d like to learn more about Prophet’s approach to digital transformation, get in touch today.

In this year’s State of Digital Transformation report, our goal is to identify the key differences between the businesses who succeeded at digital transformation, and those who were still struggling. We surveyed 587 executives from the US, Europe and China, across a range of industries to highlight not only their current digital capabilities but the key investments and choices they made that got them to where they are. By separating the responses of high performers and average performers, we identified the key characteristics of companies that successfully met their transformation goals.

This report serves as a benchmark for what digital maturity looks like in 2021 and charts a path forward for businesses that are looking to thrive in the next wave of digital transformation initiatives.

Key findings include:

• Growth and innovation were the top transformation goals for top performers, while average performers cited modernization and efficiency as their top goals.
• The majority of companies used a holistic, or coordinated simultaneous transformation approach to transform the organization, rather than transforming departments in isolation, or sequentially.
• COVID-19 reduced budgets and resources for transformation, but it did not slow transformation programs. In fact for high performers, it accelerated transformation efforts.
• Companies with successful transformations were much more likely to prioritize data management, innovation, customer experience and employee experience initiatives, compared to average companies.
• Transformations led by the CEO are more successful than those led by other positions
• Digitally mature companies are looking to invest in leveraging data, optimizing customer and employee experiences, and building external partnerships and networks to prepare for the next phase of transformation.

Download the full report below to learn more.

If the kids had TikTok to get them through the pandemic, the adults (or at least the business elite) had Clubhouse. The much-lauded digital audio chat platform was the hit of the summer last year, and many regarded it as the first of a new wave of social media innovation. Companies scrambled to figure out their “Clubhouse strategy,” while competitors like Facebook and Twitter fast-tracked their clone offerings. For a while, all anyone could talk about was how Clubhouse was the future of audio.

This summer, not so much.

Clubhouses’ monthly downloads are in a steep decline, going from 9.6 million in February to only 900,000 in April. At first glance, this looks pretty ominous for Clubhouse. It would imply that it’s quickly reaching the point where everyone who would want to download it will soon have already downloaded it. However, that might not be such a bad thing. By focusing on monetizing a core, loyal audience, Clubhouse can build a very sustainable business, while continuing to test and innovate with new features. Furthermore, the fact that Twitter and Facebook jumped in so quickly to compete validates the opportunity in this space. The value being provided by audio-chat platforms is clear, and so it’s my view that reports of Clubhouse’s demise have been greatly exaggerated.

“By focusing on monetizing a core, loyal audience, Clubhouse can build a very sustainable business.”

That isn’t to say there aren’t problems. Twitter and Facebook may have validated Clubhouse’s value proposition, but that also makes them giant predators waiting to either acquire or kill the competition. And unlike Clubhouse, they won’t be in a giant rush to monetize the audiences.

So if you’re a business that feels like Clubhouse is a technology you need to be leveraging, what do you do? Well first of all, why?

If there’s one thing we’ve learned from 20-odd years of social media, it’s that every company doesn’t need to be on every channel. In fact, successful companies have smartly chosen the channels and platforms that most closely align with their brand identity, business needs and most importantly, audience presence. It’s a model perfected by individual creators or influencers, who’ve chosen to become famous on a single channel, whether it’s YouTube, TikTok, Medium or Instagram. 

Following that strategy really narrows down the list of businesses that could leverage a platform like Clubhouse. If we think about it purely in terms of content strategy, it is companies that benefit from regular conversations and feedback with a dedicated community of users and enthusiasts for their goods and services. Think of companies like REI, who’ve created an entire content stream based on contributions from outdoor enthusiasts.

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Content strategy has become increasingly important for brands to stay competitive in the ever-changing China market. As consumer expectations for relevant, branded content continue to climb, companies must regularly adapt internally to deliver on these needs.

In a recent report The 2021 State of Digital Content by Altimeter, a Prophet company, we surveyed 484 executives across the US, Europe (UK, Germany, Spain) and China, to understand how companies are shifting their strategies when it comes to content. Our study showed that Chinese companies, in particular, are taking a more proactive approach to winning with content.  73% percent of respondents indicated they’re focused on increasing output volume and scaling internal capabilities for better content production and processes.

Learn key insights and takeaways from the report, including how companies in China are redefining their approach to content strategy:

1. Beyond the Transaction: Building Brand Through Content

When it comes to measuring success, tangible revenue and lead generation are still important to marketers as an outcome of a successful content strategy. In China, 52% of companies mentioned transactional goals (e.g., lead generation, revenue increase, customer support) as the primary purpose of their content strategy. However, the shift towards a more brand-driven approach is increasingly apparent, with an almost equal number of companies (48%) responding with branding goals (e.g., brand awareness & sentiment, thought leadership) as the main driver.

Further driving the shift from short-term transactional goals to long-term brand building is the focus on engagement as a key metric of content performance. In our research, 49% of Chinese companies point to engagement metrics as the primary way to measure the success and effectiveness of a piece of content.

“The focus on engagement as a key metric of content performance.”

In China, e-commerce platforms, such as Alibaba’s Taobao, are recognizing the role that content plays as a vehicle for customer engagement. Taobao is rapidly building out the necessary tools to support both sellers and key opinion leaders (KOLs) in managing sales, content and customer/ fan engagement. In an interview with SCMP, Yu Feng, Alibaba’s vice-president who oversees Taobao’s content e-commerce noted: “We [are dedicated to] driving unique value propositions for long-term engagement and business opportunities for the ecosystem.”

2. Scaling Up: Delivering Data-Driven Personalization

When asked about content strategy priorities for the next 12 months, using data to create better, more personalized content tops the list for Chinese companies.

And they are quickly scaling up their internal capabilities to meet these goals. As many as 68% of companies surveyed are already using centralized data systems (e.g., CRM) to help create customer segment-specific content rather than relying on disconnected data sources (versus 42% in the rest of the world).

To define these customer segments, 36% are leveraging AI-powered analysis of demographic, behavioral and psychographic data (versus 15% in the rest of the world). This data-driven customer segmentation allows brands to effectively create relevant, customized content for their consumers and adapt to changing trends based on continual data collection and analysis.

So-Young (新氧), a leading digital player in the booming medical cosmetology industry, shows how Chinese companies are building deep data capabilities to help power their content strategy. The app, which went public in 2019, acts as a platform for users to discover, evaluate and book plastic surgery and other medical cosmetic procedures online. It begins with an AI-powered “facial diagnosis,” the results of which lead to the user to recommended expert articles, blogger videos and reviews from other users. Based on the user’s in-app and purchasing behavior, the content is further refined and tailored, increasing customer engagement across the entire journey.

3. Breaking it Down: Leveraging Modular Content Management

Due to the hierarchical management style of most Chinese companies, coupled with their being in the earlier stages of content strategy development, content management is typically a centralized function.

79% of Chinese companies report managing content strategy within a single department or dedicated team that acts as the content owner across the organization (versus 60% in the rest of the world). To ensure quality and consistency across all elements of the brand, 74% utilize a central design system that includes visual and editorial guidelines (versus 52% in the rest of the world).

Nonetheless, this centralization and hierarchical model can hinder the speed at which content gets created. 59% of Chinese companies still share every piece of content with legal and compliance teams for approval.

Modular content management, however, is becoming more valued, as it allows brands to deliver content quickly across different channels and to different audiences. 30% of companies have adopted modular approval systems to break content into smaller pieces, increasing both efficiency and flexibility.

This modular content management is critical as the proliferation of Chinese content platforms is at an all-time high, with brands needing to manage various content mediums (e.g., imagery, video, live stream, user-generated) across a growing number of social media and e-commerce touchpoints. A centralized but agile management system is critical to balancing consistency, relevance and speed across content platforms.

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Virtual reality is the breakthrough technology that seems perpetually on the verge of actually breaking through. It’s been around in some form or the other for almost 20 years, and yet, is still seen as a niche innovation, best suited for gamers. But even within that niche, virtual reality hasn’t taken off the way we expected it to. So what happened? 

Back in 2018, I wrote a research report on the emerging business use cases for augmented, mixed and virtual reality and was pretty bullish on the technology. It was hard not to be — Facebook had just released Oculus Go, the first cordless VR headset, and gifted it to all the attendees of its F8 conference that year. At $199 apiece, this was the first affordable VR headset entering the market. As I put it on and demoed a virtual roller coaster, I was blown away by how real the experience felt. I walked away convinced that anybody who tried VR would think it was the most incredible technological innovation in the last 10 years. 

As I enthusiastically demoed the headset for my work colleagues and family, I began to notice a common theme. After the first 10 mins of oohing and aahing over the roller coaster game, there was always a “now what” moment with anybody who tried it. The excitement had quickly worn off, and I didn’t have a new shiny thing lined up to show them. 

“I walked away convinced that anybody who tried VR would think it was the most incredible technological innovation in the last 10 years.”

That, in a nutshell, sums up the problem with VR. The technology is a wonder, and it continues to become even more impressive. However, the software simply isn’t as compelling. The platform doesn’t have any blockbuster games the way Xbox, PlayStation or even mobile phones have. And while VR headset makers like Oculus, HTC and Sony continue to make great leaps in making VR headsets more affordable and less clunky, the experiences within them are still, for the most part, mediocre.

As Ben Kuchera acknowledges in his article for Polygon, “There’s a secret the VR industry doesn’t want you to know, however, and they’ll never talk about it. Especially since people like older virtual reality enthusiasts like me are often so ready to praise the latest breakthrough: For all the exponential growth the technology has seen in just the last decade, as it exists right now, VR is still horrible.”

When it comes to commercial use cases, companies are more likely to get value out of augmented reality, which enhances existing physical experiences, rather than forcing you to immerse yourself in a virtual one. And ultimately, the average consumer simply doesn’t see the value of owning a geeky-looking headset to play a few games that make you dizzy and disoriented after 30 mins.

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Watch the video to learn more.