In today's digital world, kids are interacting with devices more than traditional toys. Toy manufacturers must find a way to attract parents and kids back to more traditional toys like Lego, and Barbie, by merging the traditional with new digital experiences. The Wall Street Journal recently covered this topic in an article titled, Lego Turns to Digitally-Saavy Dane as Its New CEO, exploring the race between Lego and Mattel to be the world’s largest toy manufacturer and the strategic actions they are taking to get there.
Lego hired Niels B. Christiansen as their new CEO because of his technology background and previous experience in digital. Earlier this year, Mattel hired Margaret Georgiadis, the former President of Americas at Alphabet to be their CEO, with an obvious goal of digital enablement and transformation. Boards and C-suites know they must have a digital-first mentality throughout the company. The fastest path starts at the top, and includes empowering leadership teams to enable digital transformation -- with the products and services sold, with technology and infrastructure, and with processes and people.
There are many companies, like Lego and Mattel, that have realized that digital transformation should happen across the entire organization to be successful. I’ve spent a lot of my time over the last six months on digital commerce projects that are really part of these full-company, larger digital transformations. Digital transformation opens up new opportunities for revenue, cost efficiencies, customer engagement, recruiting top talent, attracting new investors, and ultimately higher profits. That requires investment and a commitment to success, as well as strategic planning, roadmaps, research, technology and change management.
Unfortunately, many companies still think of digital commerce or digital marketing as tactical efforts to support lower-cost channels, or to better engage with customers. Getting the full support of senior leadership to truly power digital transformation is very challenging for many traditional brands. But support they must get; senior executives across all functions must engage in the planning and decision-making process for true digital transformation. This forces cross-functional teams to examine the impact of change on their products, people, processes, and technology. It also frequently opens up many new opportunities that would not be thought of for more tactical, workgroup sponsored digital projects.
Often, digital transformation starts with investing in new infrastructure to support content and commerce, or sales and service. This is a great enabler for broader change. Investments in either of those areas usually focus on better servicing customers. They can have dramatic impacts on revenue and the cost to service customers. This frequently engenders more digital investment.
As those projects evolve in maturity and success, organizations find that digital workflows and sales enablement tools speed up internal review processes, order-to-cash processes, product development cycles, and offer many other strategic impacts to the organization.
Frequently, infrastructure costs can actually be reduced by normalizing platforms and technology across business units and functional areas. New marketing teams may bring in Saas tools that don’t require IT involvement to get things done. Unfortunately, this often means that systems are not well integrated to support business processes and different business units start using different tools for the same purposes for things like email marketing, CMS, and even CRM.
Product development is a new growth area. As digitally-minded leaders join organizations, they influence product directions with their thinking. Product development cycles can be accelerated, and test marketing with real customers can be done easily by launching direct-to-consumer websites and getting direct customer feedback.
Engaging with customers in traditional sales channels will not work to power future growth as most consumers buy and do business online. Dipping your toe into digital doesn’t work. You need to commit and then crawl, walk, run in your approach across the organization. Mattel and Lego seem to be all in. Let the toy battle begin. Who are you going to take on as you invest in digital?
Rightpoint leverages core capabilities in Digital Strategy, Customer Experience Design, Technical Implementations, Sales and Service, Change Management, and Digital Execution to design and implement solutions that deliver the business outcomes our customers are seeking. Learn more about how our deep understanding of B2B and omni-channel retail commerce enables our teams to drive digital transformation across all your sales and marketing channels.