Achieving Digital Maturity: A Key Strategy for Premium Brands

Key takeaways

BCG found that digitally advanced companies outperform their peers in revenue and ROI. From 2017 through 2020, 40% of these companies achieved revenue growth exceeding 10%. Only 19% of companies with the least digital maturity reached the same goal.

To say that today’s business world is technology-driven would be an understatement. As of 2024, 70% of organizations have a digital transformation strategy in place or are working on one.

Is yours one of them?

Digital maturity helps premium brands to maintain their exclusivity and high standards. It allows them to offer personalized experiences, engage in compelling storytelling, and control distribution to preserve their high-end positioning.

Maturity also enables them to meet changing customer expectations by giving them convenient access to information and services across many channels.

In this post, we will explore digital maturity and a process that organizations can use to achieve it.

What is digital maturity?

Digital maturity refers to a business’s ability to create value using technology.

The journey to full maturity consists of several key elements:

• Strategic alignment

• Operational excellence

• Technological readiness

• Cultural transformation

• Using data for decision-making

• Scalability and innovation

• Customer experience integration

Organizations progress through various stages to reach full maturity.

Most start the process by adopting basic tools. If they continue, companies can become more advanced, using technology throughout business operations.

Full digital maturity has its benefits, such as optimal operational efficiency. Others include an increase in customer satisfaction and stronger brand differentiation.

But converting an organization into a “fully” digital one doesn’t happen without a plan. Brands must also be ready to invest in the tools and empower the workforce to succeed.

Companies must also have a long-term commitment. Sometimes, businesses are more focused on short-term results. But digital maturity is an ongoing journey that never ends.

Let’s break it down a bit more:

Aspect	Description
Preparedness	Ready for structural shifts over time.
Strategic Alignment	Aligning digital strategies with company goals.
Consistent Innovation	Ongoing efforts to embed new technologies.

Digital maturity vs. digital transformation

It is easy to confuse the terms digital maturity and digital transformation.

• Digital maturity refers to a company’s state of readiness. The question is: do they have the tools, processes, and mindsets that will enable them to adapt and evolve?

• Digital transformation is a plan of action. How does the organization apply the tools, processes, and mindsets to the way it does business?

One supports and enables the other, but they serve different purposes.

Examples of digital maturity levels

There are several models that illustrate the journey to digital maturity. So, you may see different names for each stage, but the process is similar.

Defined Stage

All organizations begin in the Defined Stage. At this stage, companies recognize the importance of digital transformation.

Until this point, organizations have used minimal technology. Most processes are still manual, and teams operate in silos.

Companies in this stage are aware of the possibilities and are talking about them. But there is no real digital transformation strategy in place.

Emerging Stage

In the Emerging Stage, organizations move toward digital systems and collaboration. Digital initiatives have a greater purpose.

For example, a business may start using tools like CRM systems or basic automation. These tools help make teams more efficient. Departments begin sharing data and collaborating. These actions help generate momentum toward digital maturity.

Testing and segmentation become important at this stage. For example, sales and marketing may collaborate to identify ideal customer profiles. As a result, the brand can focus on delivering better experiences to its best customers.

The primary goal at this stage is to integrate basic digital tools and workflows.

Integrated Stage

Digital technologies become embedded in the organization at this stage.

Teams work well together and use integrated systems to improve efficiency. Real-time data sharing gives departments deeper insights that they can use to improve. Cross-channel campaign management keeps brand consistency in place to enhance customer engagement.

To move forward, businesses must ensure digital initiatives align with strategic objectives. Many companies feel the pressure to go digital because their competitors are.

But the systems and processes put in place must support the company’s long-term goals. Otherwise, the organization will become frustrated with the lack of results and quit.

Optimized Stage

At the Optimized Stage, brands have mastered their digital capabilities. Now they’re using them to innovate and create a competitive advantage.

Teams have the training and skills to use tools like AI and predictive analytics. Companies at this level aim to set new industry standards. Innovation drives new business opportunities and strengthens the brand’s mission.

Fully Digital Stage

The Fully Digital Stage is the pinnacle of digital maturity.

Here, technology drives every aspect of the business. Real-time data flows throughout the organization, keeping it agile and responsive. As a result, the company positions itself as a force in the marketplace.

Achieving success is one challenge. Sustaining it is another. To maintain high standards, businesses should focus on continuous transformation. A company has reached this stage when the focus is on long-term innovation.

Optimized Stage vs. Fully Digital Stage

Optimized Stage	Fully Digital Stage
Mastery of current digital capabilities	Continuous evolution and transformation
Focus on using tech to innovate and excel	Focus on reshaping markets and ecosystems
Industry leader and model of excellence	Industry disruptor and pioneer
Proactively adapts to change	Drives change and sets new industry standards

Key areas of digital maturity

Digital maturity is unique to each company and industry. Each area of digital maturity enhances business value and creates a competitive edge. Here are some other key considerations:

• Technology is essential for maturity. But it should enhance the human aspect of the customer experience, not replace it.

• Leadership can support the digital transformation plan by communicating its importance to everyone.

• Businesses must invest in the right tools and address technological gaps.

• Companies can achieve operational excellence by becoming more efficient. Automation is an example that reduces manual tasks and streamlines workflows.

A culture prepared for digital transformation is open to change, innovation, and collaboration. Leaders can build this culture by communicating transformation goals and involving employees.

Breaking down silos between departments promotes collaboration. It also ensures that teams have access to accurate data so they can make better decisions. Clear performance metrics help track progress, identify gaps, and refine strategies.

Employees need training to give them confidence when using new tools. Recognizing milestones reinforces progress and keeps the momentum.

Data-guided decision-making is a big part of digital transformation. Businesses must gather accurate, relevant data, such as customer interactions and market trends. This enables them to use analytics or AI to uncover patterns and find opportunities.

Refining data ensures decisions remain effective. As a result, companies can cut costs, reduce risks, and improve outcomes.

Scalability and innovation enable growth and adaptability. Scalability involves using technologies like cloud platforms or automated systems. These systems handle higher demand without losing efficiency. Innovation leverages digital tools to solve problems and enhance experiences.

Customer experience integration brings all touchpoints together—online, app-based, or in-store. Businesses can use real-time data analysis to understand customer needs. Then, they can adjust to changing preferences and deliver tailored solutions.

Measuring digital maturity

Companies must continue to check their digital maturity level to keep moving forward. This means they must understand where they are now in relation to their ideal goals.

There are various frameworks used to measure maturity levels. The Digital Maturity Model or the Digital Capabilities Framework are examples.

These assessments look at different parts of a company’s operations, such as:

• Strategy

• Culture

• Technology use

• Data management

• Customer experience

• By finding problem areas, brands can adjust to ensure a successful digital transformation.

Measurement best practices

A successful digital transformation relies on measuring three key areas:

• Customer experience

• Operational efficiency

• Financial performance

To enhance customer experience, watch metrics like digital adoption, satisfaction, and engagement.

Brands that have become digitally mature see the results. Bank of America’s digital transition resulted in a 15% annual rise in mobile banking usage. Starbucks found that mobile orders comprised 26% of U.S. transactions in Q2 of 2021.

Operational metrics can show companies the impact of process automation and workflow efficiency. An example is UPS’s ORION system. This innovation optimizes delivery routes. The company saves about 100 million miles and 10 million gallons of fuel each year.

Financial metrics assess digital revenue contributions and cost reductions. Capital One’s move to AWS is a great example, leading to cost savings and quicker service delivery. Capital One used the AWS Cloud to improve its technology infrastructure. This gave the company the ability to meet customer needs and market demands.

These metrics provide a good starting point for measuring digital transformation success. But it’s beneficial to use a wider range. For customer experience, use Net Promoter Score, customer churn, and customer lifetime value, along with digital adoption.

To gauge operational efficiency, add metrics like time-to-market, error rates, and employee productivity. Combine these with process automation. Expand financial metrics to include ROI, profitability, and market share growth. Couple these with cost reduction and revenue.

Always check specific data against external sources for accuracy. A broader set of metrics lets organizations get a complete picture.

Risk management

As organizations work toward digital maturity, they must use strong risk management practices. This means prioritizing security, ensuring data privacy compliance, and monitoring system reliability. Companies like JP Morgan invest in digital systems to maintain strict security and compliance.

Measuring digital maturity isn’t a one-time task. It is a continual process of evaluation and change. Companies that balance innovation with risk management will likely reach full digital maturity.

Benefits of digital maturity for premium brands

Digital transformation is a powerful strategy that can help companies become premium brands. They can leverage advanced technologies to connect with customers in creative ways. Let’s look at some examples.

Enhanced customer experience

Premium brands excel through exceptional customer experiences. Digital transformation lets companies create unique, seamless, and personalized interactions.

Example: Nespresso has embraced digital transformation to enhance its premium appeal. Through AI and data analytics, Nespresso offers personalized recommendations online and in-store. Customers can use the Nespresso app to explore coffee recipes and brewing techniques. These add to the brand’s storytelling. This strategy reinforces Nespresso’s premium image.

Operational efficiency that delivers value

Digital transformation improves efficiency by automating repetitive tasks, optimizing workflows, and connecting departments.

Example: The boutique hotel group citizenM showcases operational efficiency through digital transformation. The company uses automation for its check-in process. As a result, it can reduce operational times without compromising quality. This efficiency supports its premium offering of unique, upscale lodging experiences.

Brand differentiation through innovation

Tools like augmented reality, blockchain, and predictive analytics help brands differentiate.

Example: The eyewear company Warby Parker uses digital tools in its customer experience. The brand offers features like virtual try-on and AI-driven style recommendations. These features enhance convenience. These capabilities also bolster Warby Parker’s reputation as a cutting-edge, premium brand.

Data-driven strategies to elevate status

Data is vital for understanding and enhancing a brand. Companies can use customer insights and market trends to create premium brand positioning.

Example: High-end audio brand Bang & Olufsen uses customer data to predict trends. They use this data to develop innovative products for niche markets. The brand maintains its aspirational status by creating targeted campaigns for specific audiences. Real-time data keeps them agile and prepared to meet market demands.

Strategic alignment with premium brand goals

To become a premium brand, every aspect of a business must align with its strategic goals. Digital transformation integrates systems that unify the organization. Marketing campaigns should tell the brand’s story. Product development must include luxury features, ensuring everyone works toward the same vision.

Example: We’ll use the Danish electronics company Bang & Olufsen as an example again. The company aligns its strategy with minimalist design, user-centric products, and cohesive messaging. The company’s ecosystem reflects innovation and exclusivity, supported by advanced digital tools.

Scalability and agility for sustained leadership

Premium brands not only achieve success but also maintain it. Digital transformation enables scalability and agility. Cloud-based platforms, for instance, help brands accommodate increasing customer demands without sacrificing quality. Meanwhile, agile project management ensures rapid responses to market trends.

Example: Drunk Elephant, a skincare company, is not a traditional premium brand. But it has used digital transformation to establish itself as a leader in its segment. Drunk Elephant has an online platform that gives customers personalized skincare routines. They also have a digital rewards program, which feels exclusive—a trait associated with premium.

Achieve digital maturity with The Brand Auditors

Digital maturity is a transformative journey. Success requires brands to have a deep understanding of their operations, embrace change, and master technology.

Envision a team that can use data to streamline processes and adapt to new challenges. This is the promise of digital maturity. Maturity transforms obstacles into opportunities.

Ready to transform your brand?

Contact The Brand Auditors to discover how we can guide you in unlocking your brand’s full potential. Let’s lead the digital future—together.