Every year the Altimeter analyst team publishes predictions around which digital trends will have the biggest impact on business for the coming year. This year, analysts Charlene Li, Susan Etlinger, Omar Akhtar, and Ed Terpening offer their thoughts.
Read the trends below, then watch the replay from our recent webinar, in which the team further discusses learnings from 2020 and what to expect in 2021.
Charlene Li’s trends
Digital Transformation Becomes a Transformation Discipline and Department
2020 showed that the challenges of adopting to an ever-changing business environment will make the management of transformation an on-going activity. Responsibilities will shift from building digital capabilities into overseeing business transformation tied into the long-term strategy. Companies will evolve temporary transformation management offices (TMO) into permanent departmental fixtures in the organizational chart, detailed with required skills/competencies and career ladders. Budgets previously spent on outside consultants will shift to building this capability in-house and business schools will offer courses and degrees in professional transformation management, similar to marketing, strategy, and finance tracks.
“We Work” Morphs into “We Gather”
While executives ponder the logistics of managing split time in the office (three days at home, two days in the office), the core question to ask is WHY do we need to be in the office when work gets done pretty well at home? Having tasted the benefits of working from home (no commute, work in my PJs, etc.) it will take a lot to lure many office workers back. Offices will become primarily places to gather rather than to work, as the experience of being together — either to collaborate on work or to create and celebrate culture — must be enough to overcome commute headaches, putting on actual clothes, and engaging with office politics. Implications mean a re-working of office spaces to accommodate collaborations and gatherings while de-prioritizing individual work spaces.
The 360 Customer Organization Takes Shape, But On Different Paths
The need for seamless customer experiences will force companies to develop the organizational and digital platforms needed to execute on those intentions. But rather than tearing down silos between marketing, sales, and service, they will build windows between them. B2B companies will double down on integrating marketing and sales operations, reducing the data distance so that prospects and customers flow seamlessly between these two functions. In contrast, B2C companies will focus on integrating marketing and post-sale service collaboration to close the loop on any issues that may come to light. The pace will be set by B2B2C companies who have already been integrating across the customer journey, often out of necessity.
Susan Etlinger’s trends
Organizational models will begin to transform
As the world emerges from the COVID-19 pandemic, leaders will assess the many lessons learned in 2020. Distributed work is here to stay, but will become more of a spectrum of hybrid models than a binary between “onsite” and “remote” work. The brittle nature of complex supply chains and intelligent automation will drive some companies to vertically integrate and localize, while others will build ecosystems as a way to extend value and hedge against future disruption. Leaders will start to scale scenario planning across the business, scanning for risks and opportunities not only in financial models but in externalities — weather, social movements, public health and others — on a more regular basis. All of this adds up to the need for increased decision-making at the edge supported by scaled insight tools and a single source of (data) truth that can inform strategic decisions consistently, quickly and with confidence. As a result, we’ll finally start to see real experimentation with different, more resilient and less hierarchical organizational models for enterprise.
Workforce analytics — eventually digital workforce platforms — will become a key enabler of distributed work
As the pandemic moved critical functions to the cloud and accelerated digital transformation, it rapidly became clear that existing, siloed ways of understanding enterprise performance and employee productivity do not translate well to digital business. Email and collaborative tool analytics offer slices of insight on discrete activities, but leaders quickly learned that any situational awareness they had depended to a great extent on the nonverbal, environmental cues that they could pick up in their physical workplaces. While in 2020 this resulted in more meetings, more 1-1s, more virtual coffee chats, more everything — this isn’t sustainable. The real opportunity is in workplace analytics and eventually digital platforms that offer a comprehensive view of digital workplace signals, from discrete activity and employee/customer sentiment at a departmental level to business performance overall.
Intelligent technologies will become a competitive differentiator — just not in the way you might think
This doesn’t mean all competitiveness relies on using AI. Rather, as intelligent technologies continue to become commonplace, the way businesses use them will drive performance. Poor data governance will result in critical systems built on the equivalent of digital landfill. Over-automation, over-reaching use cases, over-reliance on machine over human understanding will simply exacerbate existing areas of fragility and brittleness in the business. Lack of accountability and responsible technology processes will erode trust in data, digital products and services and, eventually, brands themselves. As digitalization and intelligent automation increase, the key to using these technologies effectively and inventively will lie not just in placing a “human in the loop” but in starting from business strategy and then applying intelligent people — and technologies — where they add most value.
Omar Akhtar’s trends
Increased integration across different customer-facing teams
Companies are moving towards an even more integrated working process between their customer facing teams, namely marketing, sales and service. Our most recent research shows that the majority of marketers are collaborating with sales teams more than they ever have. This includes sharing and even co-creating digital campaign plans and strategies. In addition, marketing, sales and service are increasingly being assigned shared goals for customer experience and revenue generation. This collaboration is more than simply working better together, it requires an investment in shared digital platforms, the scaled adoption of innovative practices and continuous transfer of data between previously separate teams.
Shift from 3rd party data to first and second party data
While companies may never get away from using third-party data completely, we do foresee a big shift away from it. For many years, marketers have used third party data, i.e. data procured from a service provider or market place to identify and target new customers, or enhance the data on their existing customer profiles/segments. However, this data has been highly reliant on cookie-tracking technology, which we now know is going away. Consequently, companies are preparing to wean themselves off buying data from vendors, and instead generate more insights on the data from owned sources. Another alternative is to exchange data from second parties, or companies that are not competitors, but may provide complementary products or services. We believe these partnerships are safer, and more mutually beneficial, and should be an area of focus for any marketers preparing for the future.
Increasing marketing use cases for AI
2020 may be the tipping point for AI usage in digital marketing. Our recent survey on the State of Digital Marketing showed that almost a fifth of companies were comfortable using AI to generate and analyze customer segments, predict and design customer interactions, and personalize content elements for greater relevance and engagement. In addition, AI is being used to automatically recognize, tag and organize digital content to help adapt to the tremendous scaling of content needed for today’s hyper-personalized digital campaigns. If you haven’t already, 2021 is a good year to start turning on and exploring those AI features in your existing software, or start listing the use cases where AI could add value within your marketing organization.
Ed Terpening’s trends
The Digital Transformation of Selling will change the Sales-Marketing Relationship
Over the years, Marketing has led the charge into analytics and digital enablement to increase their effectiveness and scale impact. There has been an uneven understanding of technology and data between marketing and sales teams for years. As Sales embraces the digital transformation of selling, their data, tools and skills will rival Marketing’s. Where in the past a sales team may have had to simply trust Marketing’s data, their new skills will make them equal digital peers. This will force marketing to better justify their analytics, and sales’ empowerment through digital will expand what they do. For example, sales will increasingly prospect their own leads using SFA tools, which will diminish the value of a Marketing Qualified Lead.
The pandemic will have lasting impact on sales teams
Our research has found important gaps in digital selling maturity during the pandemic. While 75% of businesses report at least some gaps in digital sales readiness during COVID-19, 33% have identified significant gaps. We’ve found that top sales performers are much more digitally capable than their peers — evidence that digital skills and enablement translate to results like exceeding sales quota and customer satisfaction goals. The pandemic has initiated digital pilots — especially among Fields Sales organizations hit particularly hard by forced virtual selling. And business buyers have learned new ways to work virtually. Much of these practices are sure to continue post-COVID, with both buyers and sellers learning where digital adds the most value.
In the midst and aftermath of COVID-19, businesses will need to reimagine their customer journey and sales funnel
Business buyers’ adoption of digital tools to evaluate and acquire products has been accelerated by their new work-from-home constraints. With this change in buyer behavior as a catalyst, B2B sellers will reassess their customer journey work and sales funnel processes. Our research has shown that B2B2C businesses outperform B2B sellers using digital, and they report half the disruption experienced by B2Bs during the pandemic. Given the maturity of consumer e-commerce practices, B2B2Cs understand how digital shoppers make buying decisions and the expectations their customers have and so should be studied as an example for how B2B can successfully transform.