Digital Business: Know the Meaning and Importance

Digital business, evolving through technological adoption like AI and IoT, is transforming global commerce. Embracing digital strategies, enhancing customer relationships via CRM tools, incorporating technology into operations, exemplifies success seen in Domino's AI and IKEA. Upcoming trends in 2024 highlight AI's pivotal role in business strategies, underscoring innovation and sustainability.

Today, 93% of companies globally plan or have a digital-first business strategy (Foundry). And IBEF states India is the ‘fastest-growing digital economy’ to reach USD 5 trillion!

While this trend is evolving and making businesses more competitive, do you plan to start or transform into a fully digital business? 

But, will you think of shifting to digital marketing to reach more consumers, adopting cloud infrastructure or AI to increase efficiency and scale up, or all? 

Well, you got to know what a digital business is first. We will move on to key concepts and examples to broaden your understanding. 

What is Digital Business?

Digital business involves using digital technologies to improve how a business operates, enhances customer experience, and makes internal processes more efficient. The meaning of this is that it is all-encompassing and offers more than what traditional businesses are capable of offering. It is the use or adoption of digital tech to improve business models, improve customer experience, and make internal operations more efficient. 

Key Elements of a Digital Business to Know

You should also know what a digital business is not. 

According to Gartner, it should not be approached like an IT program. It should “become an enterprise mindset and lingua franca, with digital expertise spread across the enterprise and value ecosystem.”

Amidst all such advancements, it is also important to note that the term digital transformation is not as recent in the pandemic as many confuse it to be. Brands like Lego started transforming way back in the early 2000s.

Lego digitised its supply chain as early as 2005 before declaring bankruptcy. Soon in the later years, the brand executed enterprise-wide digital solutions from product lifecycle management to IT. 

So what could a company consider as common components of a digital business?

Building and Maintaining Customer Relationships 

Every digital business focuses on a customer-centric strategy – be it inbound marketing, building a huge social media presence, and/or using CRM tools. 

These approaches help the business smooth the customer journey because it is no longer about a one-time transaction with a hard sell. 

Companies now adopt CRM tools like Salesforce, HubSpot, or ZOHO to craft strong relationship strategies segmenting customers through hard data at a huge scale. This is impossible with traditional marketing. 

And as digital marketing trends dictate, a business has to cater to an always digitally connected target audience. Without personalisation, it is impossible to be profitable. And while CRM is often considered an IT thing, it should be integrated deeply with the organisation’s values and customer expectations. 

A study by Deloitte states, “Companies need to be aware of both the customer and the company perspective and combine them to meet the customer’s expectations.”

Further Reads:

Incorporating New Technology into Products and Processes

Technological trends like Robotic Process Automation (RPA) can be used in various background activities of manufacturing that increase efficiency. For instance, RPA can help manage large inventories and compare pricing automatically for customers. 

The core message behind this is organisations are scaling up faster today due to going digital. The processes are more efficient, giving more opportunities to quickly include product features that provide actual value to customers. 

Examples of Successful Digital Businesses 

See how top brands are pioneering the digital business community.  

Domino’s AI Implementation

Domino’s Pizza is one of the biggest examples of a business adopting the latest technology. It introduced its AI chatbot, and anyone could order a pizza from Alexa, Twitter, Facebook Messenger and even one’s smartwatch without ever speaking to a human. 

Now that’s not the only AI implementation of the fast food company. 

In collaboration with Dragontail Systems, it developed the one-of-a-kind DOM Pizza Checker back in 2019. It could scan a whopping 13 million pizzas when it came to maintaining quality before reaching the customer’s doorstep. This boosted customer satisfaction.

You can also go read Domino’s digital marketing strategy to learn more about the brand. 

IKEA 

This Swedish brand redesigned the customer’s purchase journey both in-store and online. 

In an interview with Harvard Business Review, IKEA’s Barbara Martin Coppola mentioned how the brand stores became fulfilment centres where all logistics processes are carried out. 

The company used data and analytics to operate the store both as an eCommerce one as well as where customers can come and buy physically. It also introduced the ‘Shop & Go’ app feature, where customers could immediately skip the waiting line and pay from their mobile. 

With such incorporations of tech and digitisation of internal and external operations, the revenue growth skyrocketed from 7% to 31% within three years. 

Digital Business Trends in 2024

• GenAI (generative AI) is becoming a pivotal tool in developing new digital business strategies. One of the most popular with over a million users is ChatGPT. Demandsage mentioned that more than 92% of Fortune 500 have been using it. At this time, you can also learn and start your digital business with ChatGPT courses. You might also look into the different ways to master the ongoing AI trend that powers digital businesses today with the recommended courses on GenAI.   
• In an Infosys MIT survey, of 250 business leaders, 40% predict that adopting a Data & AI economy will lead to more innovation, customer satisfaction, and return. 
• Sustainability goals are increasingly influencing digital technology investments today, according to both Forbes and IDC. 

Parting Thoughts

Technology is always a major driver of the global economy. Businesses stay competitive and bring innovation to the market by embracing digital transformation using AI, IoT, edge computing, and the like. But digital business is not just adopting new technologies, but also implementing these technologies into processes. 

And since you have made it this far, we want to help you with a recommendation with digital business course online from BITS Pilani. The MBA in Digital Business is for working professionals and is highly beneficial for the following reasons. 

1. Participants learn about emerging technologies and how to leverage them to design, build, and manage digital businesses, which is crucial in today's digital era. Additionally learn about the modern-day customer experience management.

2. Access to remote labs in finance, analytics, and general management enhances practical learning experiences and skills development.