Spotting winners in the battle for the digital consumer

The time when digitization was an activity for technology companies alone has gone. Technological innovation is no longer solely the domain of big internet companies and hip startups in Silicon Valley. More and more ‘normal’ companies, in a wide range of business sectors, are embracing technological developments.

The reasons are obvious and of an economic nature: new technologies can reduce costs and help maintain margins, and digitization is the way to contact clients directly.

Strong brands are increasingly going digital

Zara and Victoria’s Secret are two examples of retailers that understand how it works. While the physical store and online shop are still two separate concepts at many companies, at these retailers they’re becoming more and more intertwined. Sports brands like Nike and Under Armour understand this too. By introducing health apps like MyFitnessPal and Endomondo, they are responding to the needs of modern consumers and are even creating communities.

Victoria’s Secret is performing much better than for example Abercrombie & Fitch or Esprit, and Nike and Under Armour are winning territory from Adidas. Scale is important if you want to be a front runner in brand digitization. Increased sales and profit mean larger free cash flows, which can be invested in technological developments. Global players therefore have an advantage over regional or local ones.

Starbucks – in essence, nothing other than a place to drink coffee – is a textbook example of a non-tech company that embraces technological innovation and uses it to generate customer loyalty. This ranges from their recently launched Mobile Order and Pay service, where you can walk into your local store and pick up your freshly made coffee without having to wait in line, to Twitter try-outs inviting you to ‘Tweet a Coffee’ to your friends.

‘Stop moving with the times and you risk becoming irrelevant’

In the US mobile payments now account for 20% of all in-store orders. The advantages are clear: shorter waiting times and easier payment enhance the user experience. These may seem like small steps, but they are actually a sign of ‘big thinking’ when it comes to digitization. Starbucks is moving with the times – in other words, responding to changes in the consumers’ world. It is the best way to stay relevant in a changing world. Stop moving with the times and you’re at risk of becoming irrelevant for modern consumers.


At Starbucks they are very aware of the importance of technology. Founder Howard Schultz is arguably more fascinated by technology than by coffee. The same applies to Robert Iger, CEO at Disney – another company that is leading the way in technological innovation.

Its MagicBand gives Disney World visitors priority to a number of top attractions, but also functions as their hotel room key and registers any purchases they make during their stay – which they only need to pay for when checking out. Shorter waiting times and easier payment – with higher sales as a result.

Here, too, customer experience is seamlessly linked to commercial interests. It’s no coincidence that a top man like Iger is also on the board of a large technology company like Apple. His passion for technology plays a part in this, but this role also places him close to the action and on the front line of technological innovation.

Jonathan Boyd
Editorial Director of Open Door Media Publishing Ltd, and Editor of InvestmentEurope. Jonathan has over two decades of media experience in Japan, Australia, Canada and the UK. Over the past 17 years he has been based in London writing about funds and investments. From editing the newsletter of the Swedish Chamber of Commerce in Japan in the 1990s he now focuses on Nordic markets for InvestmentEurope. Jonathan was awarded Editor of the Year at the Professional Publishers Association (PPA) Independent Publisher Awards 2017. Shortlisted for the same in 2016, he was also shortlisted in 2017 and 2015 for the broader PPA Awards category Editor of the Year (Business Media).

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