Virto Commerce’s CCO Talks Digital Transformation: “Seven Years in Digital Is One Year Offline”
In this interview, we talk to Denis Clifford, Chief Customer Officer at Virto Commerce, about his experience digitally transforming multinational companies. Before joining Virto Commerce, Denis worked with some of the world's biggest beer brands, including Heineken, where he held a senior commerce role for more than 12 years, the last five focusing on eCommerce. During his time in the drinks industry, Denis successfully launched ecommerce platforms in 14 countries and worked with businesses in more than 30 markets globally. Since Denis has helped multiple businesses drive digital adoption and develop digital transformation strategies, we thought he was an ideal person to talk to about digital strategies and the transformation challenges that multinational companies continue to face.
Hello, Denis! Please talk a bit about your professional background and how your experience relates to this interview’s topic of digital transformation in multinational companies.
Denis: My professional background is in two main areas: one is in call center and project management, and the other is in the area of digital transformation and customer centricity. So, I’ve been working in the call center industry for twenty-something years and managing people and teams for probably just as long.
I started in the drinks industry in 2005 as a Call Center Manager and then worked as a Head of Customer Service and Credit for Beamish and Crawford before joining Heineken in 2009.
Around 2015-2016, after having worked as a Head of Customer Service at Heineken for a number of years, I became more interested in ecommerce and the company’s digital strategy. After successfully implementing the ecommerce project in Ireland, I joined Heineken at the head office and started working on the digital transformation with Heineken’s clients, partners, and regional offices around the world.
Could you please tell us more about that time in Heineken when you embarked on a mission to digitally transform the company?
Denis: I was one of only two or three people, pioneers in a sense, working on digitizing fairly traditional routes to market. We were able to demonstrate to the wider business community that if individual markets didn’t engage in the digital transformation, then competitors or digital-native companies would. They could potentially steal market share and, more importantly, value out of the route to market by becoming intermediaries between customers and suppliers or digital intermediaries between wholesalers and customers of Heineken.
So we did a number of things. We traveled to many markets to understand how “digital” was affecting both fairly direct and straightforward supply chains and very fragmented markets. We launched successful pilot projects in Mexico and South Africa, while simultaneously learning about the technology side of things. We soon discovered that large static ecommerce platforms, which can be expensive and slow to develop, albeit powerful and robust, are not always the right fit for every market - especially medium-sized markets with a requirement to transform quickly. So we became interested in flexible, adaptable ecommerce platforms and that’s when we discovered Virto Commerce.
What did your role as a global ecommerce project manager at Heineken involve?
Denis: My role, predominantly, was about working with management teams around the world, talking with them about the risks and opportunities of “digital”, meeting with their customers and sales teams, developing and creating digital projects, and helping them build their digital strategies. By the end of the engagement, the company would have a go-to-market plan with estimations and recommendations regarding new roles, technology, budget, and ecommerce features that customers would most likely want to have. And then after that, I’d support the team on that digital journey while overseeing their business growth and assisting them whenever necessary.
From your experience, how has switching to “digital” transformed the thinking and planning of multinational companies, both short and long term?
Denis: I don’t remember where exactly I heard that expression, but someone said to me that seven years in digital commerce is the equivalent of one year offline – things move so quickly! Indeed, transacting online enables you to do things much more quickly than you could have done offline. Multinationals have come to the understanding that if they don’t embrace digital now, then even smaller challengers can come in at any time and disrupt the way they do business. So, one of the main things that traditional multinational companies are really doing by embarking on digital journeys is that they are preserving, and eventually growing their business. Multinationals are also seeing digital as an opportunity to grow by making strategic alliances with other companies and consolidating their services on digital platforms where customers can access a range of services from virtually anywhere in the world. That’s why I think marketplaces are growing at such an astonishing rate, and I think that’s unlikely to change in the foreseeable future.
Multinationals are seeing digital as an opportunity
to grow by making strategic alliances with other companiesand consolidating their services on digital platforms
where customers can access a range of services
from virtually anywhere in the world.
Denis: So, digital requires really agile planning. Consider budgeting, for example. In larger organizations, you have, say, a three-year budget, which you update every September for the following year and that’s it; it’s pretty much set in stone. On the contrary, you’ve got to have a far more agile approach to budgeting in digital, where you have a large investment upfront which falls off as you start to reap the rewards. You need to revisit the budget more often and, more importantly, give the team with the budget much more autonomy so that teams can respond quickly to what’s happening in the market and what customers demand.
The biggest challenge that many companies face is to be able to think and act fast enough to keep up with the changes in the digital space. The companies that do it very well are the ones that set up autonomous teams or even spin out a whole digital entity to run digital projects.
Again, since traditional businesses are not set up for the speed that you need to run digital projects, they are bound to face those agility challenges.
The biggest challenge that many companies face
is to be able to think and act fast enough
to keep up with the changes in the digital space.
The other challenges are around resources. Although all your existing skills and capabilities are really important, you’ll need to augment them with some particular skills like digital marketing or customer experience optimization. And sometimes, I think multinationals find it challenging to start recruiting for the skills they have not employed before. Obviously, it’s easier for digital natives because they were basically born with those skills and can easily substitute because they know where and what to look for.
On the other hand, a lot of digital-native companies lack the more traditional experiences and robustness of supply chain operations, warehouses, trucking, and logistics. If it’s virtual and moves at speed, then those companies are very comfortable with it, but whenever offline, backbone operations are involved, digital natives can certainly take a back seat to more traditional businesses.
How do multinationals address those challenges? What are the common mistakes multinationals make when they try to tackle transformation challenges?
Denis: One of the solutions to those common challenges I’ve mentioned is the idea of spinout, where a company takes its digital operations and creates an autonomous business unit within the larger business. In order to do that, those companies buy talent from the outside or from competing digital natives or acquire digital natives entirely. Since multinationals have to transform the way they do business, the common mistake one can make is to just layer the digital part on top of everything else and hope it’s gonna work and sort itself out. It often doesn't but separate entities within the organization can operate without being encumbered with more traditional ways of doing business.
From your experience, who is typically behind the digital transformation strategy in a multinational company?
Denis: The start can come from anywhere, at least in my experience, the initial idea often comes from upper-middle management, a tech-savvy member of the management team, or from somebody in the IT or supply chain who would be identifying digital as a bit of a cost-savings initiative. In an ideal scenario, it would be coming from somebody commercial who understands the revenue-generating customer experience benefits but, unfortunately, that is not always the case.
So one of the first things to do is, convince those IT or supply chain people that, while there’s indeed a huge technology or supply chain component to digitization, the more compelling reason to digitize is revenue uplift, margin increase, data and customer experience. This means widening the discussion to business leaders, MDs, and CEOs who are responsible for the overall strategy of the business…and this is where digital transformation needs to live.
What part does technology play in a digital transformation strategy? How does the choice of an ecommerce platform affect the digitization of a business and its success or failure?
Denis: I’d say that, although I believe technology to be important, it is still not the most important bit. The choice of a commerce platform doesn’t affect the digitization of the business if it’s done right. However, the difficulty is that a lot of the static platforms are not flexible enough for the agility that “digital” entails. The real trend at the moment is toward connecting much smaller components in a digital strategy than having one huge platform. Take Virto Commerce as an example. You have a stand-alone platform, then you have an API connection to some kind of payment gateway, another API to your social network feed, and yet another API to something else. That’s really the way to go because you can scale it over time. What you don't want is the enormous ecommerce platform sitting and serving a hundred customers. You want to have something that’s suitable for that number of customers today, but which grows and flexes over time. So that’s the biggest thing that management teams should look for in an ecommerce platform — something that scales and grows over time.
are not flexible enough for the agility that “digital” entails.
The real trend at the moment is toward connecting
much smaller components in a digital strategy
than having one huge platform.
Can digital transformation be achieved with a company’s own resources? If not, is it important to look for a reliable solutions partner? How and where do you find the best partner for a transformation initiative?
Denis: I’d be surprised if a business could take on a digital transformation on its own. Because if you embark on the transformation and change project, then it means that you’ve identified a gap in your business that you don’t have enough resources to close on your own. What I think you should do for a transformation project is to create a couple of partnerships. The first one is between the commercial and the IT parts of your organization. And the second one is between your company and a solutions partner. You need outside partners who have industry experience of their own and are willing to spend the time to really understand your business - not just the IT components but the route to market, the customer pain points, your share and revenue ambitions etc.