Enabling Marketing Excellence

DIGITALIZATION
STRATEGIES
AMID COVID-19:
ONE SIZE DOESN’T FIT ALL

IWAN SETIAWAN
Chief Executive Officer

RIFELDO MEIZA
Senior Business Analyst

ANDI MAGIE FITRAHNURLIA

Senior Business Analyst

ANGGIA ARYANDITA
Senior Business Analyst

DIGITALIZATION STRATEGIES AMID COVID-19

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Digitalization Strategies
Amid COVID-19:
One Size Doesn’t Fit All
Global businesses have taken a hit due to the COVID-19 outbreak. that the pandemic—and the social distancing it triggers—has forced
Most companies are not ready as they have never faced such a businesses to become more digital faster. Customers are becoming
pandemic. Every company seems to struggle with revenue decline and more dependent on online platforms in daily activities. It changed
cash flow problems, all while managing employees who are personally the behavior not only during the crisis but possibly after. Companies
hit by the outbreak. Companies may find themselves in the middle of can no longer procrastinate on digitalization when their sustainability
confusion and dilemma to determine the right contingency plan to depends on it.
survive and even come back stronger. The crisis exposes the readiness—or rather the unreadiness—of
MarkPlus, Inc. has initially introduced a strategic framework, specific market segments and industry players to go digital. Particular
which divides the planning into three major phases. The “Surviving- demographic known to be digital immigrants and laggards will be the
Servicing” phase is the most critical since it will determine a hardest hit segments as the social distancing significantly alters their
company’s survivability in the time of crisis. When the pandemic face-to-face routines. On the other hand, digital natives might thrive
would begin to end, the company should enter the “Preparing” under the same conditions.
phase, where a transitional strategy is in place to seize the potential Similarly, the outbreak seems to cause more significant problems
opportunity. In the final “Actualizing” period, the company should be for some industries, although no business is immune to its effect.
in full swing to take the lead in the market. The sectors that require more direct physical interactions and labor-
This paper intends to further explore the strategic framework by intensive might suffer more. On the other hand, industries with
taking into account the different impacts of the crisis on various highly digital business processes and lean organizations might be in a
market segments and industry players. The central argument is much better position. (Figure 1)

Figure 1:
Harder Hit and Softer Blow

HARDER HIT SOFTER BLOW

- Older generation who are digital - Younger generation who are

immigrants and tech laggards digital native and tech savvy
- Low-income communities with - Affluent segments with better
CUSTOMER
limited access to the internet access to the internet
SEGMENTS

- Businesses with dominant - Businesses with highly digital

customer-facing processes processes
- Labor-intensive industries - Industries with lean organizations
INDUSTRY
PLAYERS

DIGITALIZATION STRATEGIES AMID COVID-19

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Digital Readiness
Assessment
The different degree of readiness dictates the digitalization strategy to The next quadrant consists of industries and companies that have
pursue. Thus, it is essential to establish a diagnostic tool for readiness difficulty migrating customers despite having performed significant
assessment. The assessment must take into account both the supply digitalization of their business processes. One example is the life-
and demand sides. The first step—from the supply side—is to evaluate insurance industry. In this case, the majority of the people are still
the ability of companies to digitalize their business processes. reluctant to buy life insurance without meeting the agents directly
The next step is to determine if the market—the demand side—is and getting an explanation about the complete policies.
ready and willing to migrate to more digital touchpoints. The two
considerations make up a matrix that maps a company’s position in #3 Organic Quadrant
the digital readiness quadrants. To illustrate the different quadrants, (High Customer Digital Migration and Low Digitalization in
we map out six diverse industry sectors: property, automotive, life Business Process) 
insurance, logistics, banking, and e-commerce. (Figure 2) This quadrant applies to industries that deliver products and
services with a high degree of physical touchpoints. Most of the time,
these industries are also labor-intensive and thus have difficulty
managing the employees remotely. On the other hand, most of
#1 Origin Quadrant the customers are ready to migrate to go digital. The example of
(Low Customer Digital Migration and Low Digitalization in this quadrant is last-mile logistics. With most customers being
Business Process)  e-commerce users, they are comfortable with online customer
This quadrant holds industries that are experiencing the hardest journey. But from the company’s point of view, only partial
hit during the pandemic. Companies in these industries would be digitalization is possible.  
less ready to face this crisis mainly because their business processes
still include significant physical interactions, which are harder to #4 Omni Quadrant
eliminate or substitute. At the same time, it is also unlikely for them (High Customer Digital Migration and High Digitalization in
to migrate customers to digital touchpoints, mostly due to the lack of Business Process) 
urgency for purchase during a crisis. The examples of this quadrant This quadrant belongs to industries that are experiencing softer
are property and automotive industry.  blow, with e-commerce and banking as two industry examples.
As digital natives, e-commerce players are naturally the readiest
#2 Onward Quadrant for social distancing policy. In the banking sector, long before the
(Low Customer Digital Migration and High Digitalization in pandemic, industry players have started digitalizing the business
Business Process)  processses and migrating customers to online channels.

Figure 2: HIGH
Origin-Onward-Organic-OMNI Matrix
ONWARD OMNI

E-commerce

Life Insurance Banking Degree of

Digitalization
in Business
Process

Automotive Last-Mile Logistic

Property

ORIGIN ORGANIC
LOW

LOW Degree of Customer HIGH

Digital Migration

DIGITALIZATION STRATEGIES AMID COVID-19

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How Ready
Are You To Go
Digital?
The four quadrants give a general view of DIGITALIZATION OF
how ready a particular industry to go digital. BUSINESS PROCESS
But every company, even in the same (1=Low and 5=High)
industry sector, might have different
readiness and therefore find itself in the The ability to substitute customer-facing touchpoints
different quadrant from its peers. Thus, each
The company can build awareness toward products and services
company may perform a self-assessment 1
and trigger a call to action through online media
1 2 3 4 5
based on its ability to go digital and the
willingness of its customers to migrate to The company can demonstrate products and services and
2 1 2 3 4 5
digital channels. address customer concerns through online platforms

The company can process transactions (sales closing, payments,

3 1 2 3 4 5
and handovers) through online platforms

The company can deliver the products/services online without

4 1 2 3 4 5
sacrificing the quality

The company can deliver after-sales customer servicing through

5 1 2 3 4 5
online platforms

The possession of digital assets

The company has a library of digital contents (website, digital

1 ads, social media) and can recreate the materials regularly 1 2 3 4 5

The company has the tools to connect with customers (e-com-

2 merce platform, video conferencing, CRM) either in-house or 1 2 3 4 5
through third-party partners

3 The company has internal tools for employees to work

independently and collaborate remotely and virtually 1 2 3 4 5

CUSTOMER DIGITAL
MIGRATION
(1=Low and 5=High)
Customer desire to go digital

Most customers feel that offline interactions are unnecessary

1 1 2 3 4 5
and prefer online

Most customers see the products and services as less complicat-

2 1 2 3 4 5
ed and thus have no trust issues

Most customers have the incentive to go digital (more choices,

3 1 2 3 4 5
better prices, higher quality, convenience)

4 Most customers put priorities on the purchase of products and 1 2 3 4 5

services, even in difficult times

The proportion of digital-savvy customer base

Most customers (B2C) and decision-making units (B2B) already

1 1 2 3 4 5
interact and transact with the company online

Most non-online customers are digital savvy and can comfortably

2 be migrated to online channels 1 2 3 4 5

DIGITALIZATION STRATEGIES AMID COVID-19

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Strategies for

‘Origin’ Companies
For companies in this quadrant, the strategy centers around the
lean business principle, which focuses on delivering value with a
reduced amount of resources. It includes reducing cost-to-serve,
operational cost, as well as time and energy in business operations.
Therefore, companies can focus on eliminating unnecessary efforts
and increasing operational efficiency.

#1 Retain Best Customers

As not all customers are equally valuable, companies need to
take time to identify their most loyal customers and then build
trust through consistent and empathic communications. During
this period, marketing communication teams (B2C) and account
management teams (B2B) are the spearhead in demonstrating the
caring to the customers. They need to maintain routine interactions,
not just to offer products and services but also to show empathy.
A company might also decide to go the extra mile to provide
exclusive offerings or services to its most valuable customers,
even though they cannot contribute as much as it should. Travel
companies may offer to reschedule previously booked plans. For B2B
companies, rearranging terms of payments would reflect an effort to #3 Perform Bold Cost Cutting
maintain a good relationship with their clients. Companies need to balance the sharp decline in the revenue with
bold yet calculated cost-cutting efforts. The company may start by
#2 Revise Value Propositions temporarily closing outlets or branches, eliminating fixed costs. They
The circumstances have shifted customers’ needs and perceived must seek volunteers to take unpaid leave in turns or decide to end
value, and companies need to take steps by adjusting their value the contracts of non-employed staff. They must also consider an
proposition. A company can start by altering its offerings to meet agreement between the company and employees regarding temporary
health and safety standards. Companies that are still operating offline reductions in pay and benefits.
need to assure that the environment is safe and clean by spending a The firm may attempt to renegotiate its payment terms with
portion of their budget for sanitation. suppliers, asking for temporary value and period adjustment.
Companies need to evaluate pricing strategies and policies to Companies may also want to pull itself from any non-essential
reflect the current market condition and attract more demand. and non-urgent activities, limiting unnecessary investments.
Besides, they must continue to communicate the new value However, cost-cutting initiatives must be preceded by considerations
proposition to keep the customers informed about the company’s whether the company can seize the opportunities when the market
efforts in keeping the business run safely during the outbreak. rebounds.

DIGITALIZATION STRATEGIES AMID COVID-19

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Strategies for

‘Onward’ Companies
Companies in this quadrant need to shift their focus into creating For example, life insurance customers rely heavily on interaction
demand of the customer. Their customers do not consider the with their agents. Instead of pushing customers to browse
products and services as priorities, thus have less incentive for information and apply through the website, the company can
purchase. Hence, companies need to create an incentive to push sales. empower its agents with video conferencing platforms to be able to
reach their potential and existing customers.
#1 Stimulate Customers to Go Digital
To encourage digital interactions, companies must show the #3 Shift Focus to Inbound Marketing
benefits of going online. They may provide positive and negative The inability to physically interact has raised the consumption of
incentives to encourage digital migration. Positive incentives may digital media. Companies can take advantage of the circumstances by
take the form of instant gratification, such as cashback, discounts, identifying customer-preferred digital channels, then develop content
and consumer promotion on digital platforms. with a call-to-action to drive purchase. Companies can optimize
On the other hand, negative incentives may take the form digital marketing, utilizing most used platforms such as social media,
of additional charges upon selecting an offline method during and providing content.
interactions, or in extreme cases, companies can make offline mode To optimize the content strategy, the company may consider
unavailable to access. Aside from monetary incentives, a company implementing search engine optimization and marketing. It helps the
can inform customers about its digital capabilities and how it would company to target specific audiences most potential customers and
improve the way to do business. provide them with the selected contents.

#2 Introduce Quick-Win Tactics

Companies can pursue quick wins to gain traction during the crisis.
The company should start with identifying the customer frustration
points in product introduction, delivery, payment, and after-sales
services. Then, the company should temporarily adjust its offerings
to maintain relevance to the current condition.

DIGITALIZATION STRATEGIES AMID COVID-19

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Strategies for

‘Organic’ Companies
As for companies included in this quadrant, adaptation speed is have to be new and costly. Instead, companies can leverage existing
the key to survival. As customers are getting more digital savvy, the resources and assets that are available and accessible. The company
companies should pursue the quickest way to respond to customer can utilize technology to connect with its customers, either using
needs through rapid experimentation and strategic partnerships. An video conferencing or social media platforms for personal and mass
agile organization is imperative to implement this initiative. communication. If possible, the company may start with making its
products or services available online, whether using owned or third-
#1 Develop Agile Business Processes party e-commerce platforms.
As the situation dynamically changes, the company’s speed in Companies can also adopt various technologies to optimize work
responding and adapting to change is essential. Agile practice from home. Platforms and applications for online collaboration,
emphasizes flexible resource allocation, where teams can be formed project management, and sales activity and performance tracking are
or dissolved, and other vital resources can be deployed or retracted readily available in the market.
according to the strategic priorities.
The company should direct its business process to be more agile by 3# Build Strategic Partnerships
starting to establish small purpose-driven task forces with decision- If the company does not possess the in-house capability to adapt
making authorities in their areas of responsibilities. These teams or run the technology, IT outsourcing can be an option. Companies
need to proactively observe changes in the business environment, can get assistance in web development, database management, up to
especially customer preferences, and actively adjust internal infrastructures, and technical supports without losing focus on their
processes or iterate products or services to be more relevant to the core business. It provides advantages such as reduced labor expenses,
market. savings in time and effort, and access to the broader talent pool.
For example, a logistics company can collaborate with ICT
#2 Adopt Mainstream Tech providers to provide real-time location and goods quality data
A company needs to begin its business process digitalization during shipment for its customers by utilizing the Internet of Things
through technology adoption. The adopted technology does not technology.

DIGITALIZATION STRATEGIES AMID COVID-19

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Strategies for

‘OMNI’ Companies
The companies that belong to this quadrant can focus their strategy The use of AI can be more genuine, using a more personal
on advancing their business. These companies have the advantage approach in interacting with users. Augmented and virtual reality will
not only to think about survival but also to prepare for the post- possibly become more widely used to convince customers.Banking
pandemic. Therefore, the plans are about taking their business to a industry players can utilize this to provide better offline and online
whole new level. customer experience in using the services.

#1 Develop Offering with Next Tech #3 Strengthen Brand Values

For companies that are thriving in crisis time, they should prepare More than just making the branding activities relevant to physical
themselves for the post-pandemic. Companies may start by adopting distancing and stay at home trends, brands need to communicate
new-generation technologies that support product innovations. The values. Brands should show caring and understanding for customers
purpose is to equip companies with a set of products and services that by providing payment relief, avoiding the price hike despite high
fulfill customer’s changing preferences. demand, and providing excellent services. Caring for employees
The newly developed product should meet the customer can reflect by prioritizing their safety and health during work and
expectation of products and services with more quality but less cost. ensuring workplace sanitation.
The company can also reinvent the way services are delivered and Most importantly, the brand must show caring for the community.
starting to consider online seamless service delivery through the Providing essential supplies to medical institutions and those who
utilization of artificial intelligence, the Internet of Things, as well as affected by the pandemic are examples that can be done by these
automation. companies. Thus, after this pandemic is over, these companies will
have stronger brands in the eyes of the customers.
#2 Introduce A New Omni CX
An increase in daily internet usage will drive higher expectations
of customer experience in digital platforms. In response, companies
should begin to enhance their customer experience throughout
the customer journey. Companies may optimize data analytics to
provide customers with more personalized content according to their
personas.

DIGITALIZATION STRATEGIES AMID COVID-19

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Figure 3:
Strategies Based on Origin-Onward-Organic-OMNI Matrix

HIGH

ONWARD OMNI

- Stimulate Customer to - Develop Offering with

Go Digital Next Tech
- Introduce Quick-Win Tactics - Introduce a New Omni CX
- Shift Focus to Inbound - Strengthen Brand Values
Marketing

Degree of
Digitalization
in Business
Process
- Develop Agile Business
- Retain Best Customers Processes
- Revise Value Propositions - Adopt Mainstream Tech
- Perform Bold Cost Cutting - Build Strategic Partnerships

ORIGIN ORGANIC
LOW

LOW Degree of Customer HIGH

Digital Migration

Summary:

Assess And Address

A digital strategy is imperative to compete in the future, and
the pandemic simply increases the urgency. It is the best time for
companies to rethink their business processes and explore ways to
digitalize them. Equally important is the aggressive initiatives to
migrate customers to a more digital customer journey.
Since one strategy does not fit all, business leaders should assess its
current state of readiness in dealing with this physically immobilizing
condition, determine the most suitable plans, and allocate resources
wisely according to the new strategic directions.
The pandemic has brought threats that businesses should address,
and opportunities that companies should seize. The right strategic
actions will lead companies to not only survive the crisis but also
prepare for the future.

For inquries, please contact

Estania Rimadini ([email protected])

DIGITALIZATION STRATEGIES AMID COVID-19

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DIGITALIZATION STRATEGIES AMID COVID-19

 DIGITALIZATION
STRATEGIES
AMID COVID-19

Enabling Marketing Excellence