We’ve been hard at work analyzing the responses from the latest wave of Mod Op Strategic Consulting Digital Maturity Index (DDMI) participants, and one trend has become startlingly apparent: In the era of COVID, Culture and Innovation (C&I) – one of our seven DDMI focus areas – has become more important than ever.
We define C&I to be an organization’s capacity to respond, adapt and innovate as the needs of its consumers (and the functionality of its products and services) change over time. In short: Culture and Innovation represents the ‘digital savvy’ of your organization. Compared to our benchmark of results from previous iterations of the DDMI, C&I has seen by far the greatest category-level growth. Consider this:
- For our latest batch of respondents, category-level maturity scores for C&I have improved by 20% compared to our existing benchmark of results.
- In this batch, as well as just its top quartile, C&I is now a top two category from a maturity perspective.
- Compared to our existing benchmark, these latest respondents also consider C&I to be 3x as important from a resource allocation perspective.
The need for a culture of innovation
I imagine that for some of you, these results won’t come as a surprise. The ongoing COVID-19 pandemic has forced many companies to completely redefine the scope and branding of their products and services – bluntly, to either innovate or die trying.
What does this mean for your organization? To meet the needs of your customers in the long term, it’s almost certainly time to recalibrate your organization’s product set.
If your organization relied to any extent on revenues from in-person interaction with your clients (be they attendees at your annual convention or patrons of your high-end nightclub) COVID has almost certainly posed challenges to your business model. Survival means recalibrating – namely, evaluating and adjusting – your organization’s institutional priorities, category spend, and customer personas to meet your customers where they are now (which, more likely than not, is at home).
- More than half of New York City’s Michelin-starred restaurants have reopened, and almost all are now offering delivery and takeout. At-home offerings from such high-end establishments were essentially unheard of until COVID, but indoor dining is still only at 25% capacity in most of the city, and many potential customers, myself included, are still wary of dining in. To stay alive, NYC’s fine dining industry has recalibrated its priorities, beyond just “bespoke service and ambiance” and into “delivery and logistics”.
- Online dating has gotten a bit more literal. Facebook Dating now offers an in-app video chat system – powered by Messenger, Facebook’s chat and messaging service – for matches to go on a “virtual date,” while Bumble now lets users open to video chat-based dates put a unique badge on their profile. With in-person first dates with strangers a thing of the past for the foreseeable future, Facebook and Bumble have recalibrated their messaging, hoping to make a virtual date seem worthwhile enough to keep its users either paying monthly or dumping metadata into their platforms.
- Short-term rental giant Airbnb kicked off its “Go Near” initiative earlier this year, focusing its suggested stays and experiences on locations within driving distance (read: no flying required) of the user.
- Alongside this focus on less contact-intensive travel, Airbnb also announced the Enhanced Clean program – a set of cleaning guidelines developed in tandem with the CDC, complete with a shiny, congratulatory badge on the profiles of compliant hosts.
- Most importantly, Airbnb also extensively tracks data provided directly by its customers. One interesting tidbit: 30% of Airbnb’s rental bookings this past Labor Day Weekend were in rural or remote locations, double the rate of 2019’s bookings in this location category, while the proportion of bookings in urban areas is down considerably.
- The end result of their top-down recalibration speaks for itself: Airbnb, a company many were quick to pronounce dead as recently as this past summer, is now back on track to raise billions through an IPO.
Whether it’s a room, a meal, or a shot at love, these companies are all selling the same product they were selling before COVID. What’s been recalibrated are the details:
- A five-star chef prioritizing high-end, heat-retaining delivery containers over lounge musicians for their Q4 2020 budget.
- A head of product at Bumble prioritizing on-platform video chat capabilities over in-person meetups for their next software update.
- Or a marketing executive at Airbnb prioritizing a local getaway over an exotic, international experience in their next ad campaign.
To stay ahead of the competition during COVID (and beyond), the answer is simple: Recalibrate, or retire.
Want to figure out how your organization’s maturity within C&I stacks up against the competition? Take the DDMI today and find out.