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Is Digital Transformation high enough on your team's agenda?

By now you have probably heard it many times over- COVID accelerated adoption of digital by organisations. In our recent study of the state of play of marketing in Australia, we found that 57% of Australian organisations placed greater focus on digital driven by COVID. For many, COVID was a wake-up call for the years of under investment in the digital space and the catalyst they needed to start to make a change. But digital transformation isn’t something that is solved by COVID or a short period of investment. For many businesses, COVID created an environment where there was no other choice – doing more of the same was no longer an option and it enabled many business leaders to understand the inherent value of investing in digital. For many organisations this has kick started their digital journey – but there is still much to do to build digital maturity. And leaders are increasingly looking to marketing teams to lead that change. But are we capable of doing so?

Digital transformation and adoption by marketing teams

Whilst digital transformation is not just a marketing strategy but an enterprise-wide initiative, one of the primary focuses of any digital transformation is the employee and customer experience. It therefore stands to reason that departments like marketing, play an integral role in driving digital transformation, if the broader organisation is to be successful. Whilst some marketing leaders have successfully connected the dots – others still haven’t believed their role is to simply leverage digital marketing as part of their go to market approach.

But to lead digital transformation and drive adoption both within the marketing department and across the wider business – marketing teams need to be equipped with the skills and expertise to do so. This needs to be coupled with the appropriate investment and leadership to drive a material change in how we do business.

So are we setting ourselves up for success?

The Marketing State of Play study found that 6 in 10 marketers rate their departments digital literacy as strong – which effectively means 4 in 10 don’t. Our ability to transition and shift as an industry has been slow – digital is not a new concept or phenomena – in fact the iPhone has been around since 2007. We kid ourselves by saying it is just another channel – and to a certain extent it is but there is specialist expertise that is required to harness its potential and without it you cannot expect to effectively embrace it. If 4 in 10 marketers believe that their departments don’t have strong digital literacy in the digital age then how can they possibly drive broader change and adoption within the organisation?

Whilst skills and expertise are important, so too is investment. The Marketing State of Play study found that half of all marketing departments are investing less than 30% of their overall budget in digital and one quarter are investing less than 20%.

portion of budget investment in digital

When we delve a little deeper we can see at an industry level that there are a higher proportion of businesses in retail, business services, FMCG, healthcare and medical, manufacturing and agriculture that are investing proportionally less in digital (29% or less of their budget). Wedded to more traditional means, it has been more challenging for those in these industries in particular to pivot and shift over time.

Whilst we don’t advocate, that investment must be a certain percentage of budgets, much rather investment should be allocated on the basis of achieving core marketing and business outcomes – we know that rigid budget planning and forecasting approaches can and are reinforcing the lack of investment in digital.

The research found that 43% of Australian marketing functions adopt largely fixed or ‘set and forget’ type approaches to budgeting (incremental with slight adjustments or rolling with small tweaks). This usually means that digital investment is incremental at best and it takes a much longer period of time to shift towards a new reality as investment stifles progress. We are operating in a market of rapid change – and therefore it is surprising to see nearly half of all marketing functions still adopting such rigid approaches. If we believe that we need to embrace digital, we need more agnostic approaches to planning that enable investment to be made into areas that create the greatest benefit for our customers and our business.

And finally, to be successful we can’t look past the importance of leadership. In some instances marketing leaders have deferred the need to understand the space to a specialist or team within the marketing function. This leaves the specialist or team to bring the wider department on the journey but many are functional specialists which lack the leadership skills and stakeholder management experience to bring others along the journey. Specialists cannot fill the leadership void – but do play a vital role in the process of driving adoption. It is therefore incumbent on marketing leaders to demonstrate and reinforce the importance of embracing digital and cast a vision towards a future that enables the organisation to remain relevant in the face of changing consumer needs.

The Marketing State of Play report explores an array of other topics including key challenges facing Australian marketers, data and MarTech challenges and others.

To gain a copy of the report click here;

Need to drive digital adoption or transform? Arktic Fox specialises in helping marketing and business leaders drive digital transformation. To learn more click here


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