How to become a digital burrito to accelerate revenue
July 9, 2020
July 9, 2020
Nobody can predict the future of business in light of COVID-19, but those organizations who have digital in their DNA are likely to be the financial survivors. That’s why we’ve seen companies such as Chipotle and other large “big box” retailers continue to grow during the pandemic.
Companies need to learn from these successes and start taking actions today to accelerate their revenue in the post COVID market.
The unpredictable world we live in has forced companies to rethink how they grow. No longer does growing at all costs work. There are intense pressures to minimize costs while maximizing lifetime value. Organizations need to figure out how to deliver value to customers over their lifetime. 1 For some industries, this lifetime value may shrink if they do not adapt quickly and have a plan for accelerating revenue.
Before you can even start trying to get revenue going in the right direction, you need to evaluate your business by asking these two important questions:
Let’s discuss financial health first.
By taking cues from private equity (PE) firms and what factors they look for in company valuations, you can follow these key leading practices to position your company for financial stability, resiliency and growth:
By understanding where you stand from a financial perspective and reallocating cash for growth, you can more easily adjust your business model to become more innovative and resilient in delivering better value over the long term.
This sound financial foundation coupled with an agile digital strategy has proven to be an advantage in these volatile times.
Let’s look at some examples.
<<< Start >>>
<<< End >>>
Chipotle has quadrupled its digital business in only three years, achieving more than $1 billion in sales in 2019. They began their digital journey prior to COVID-19 through digital pick-up shelves, digitizing its make line and expanding its digital footprint to more than 98 percent of its store base.3 In the first quarter, Chipotle’s digital sales grew 81 percent to $372 million, making it the highest quarterly level for its digital sales.4
Several of the innovative “big box” retailers showed their digital-savvy by growing their April digital sales by more than 200 percent.5 While other retail chains are struggling, these “big box” retailers are excelling because of the digital transformation decisions they made three or four years ago.6 These firms not only provide an online store like many traditional retailers, but they also provide an easy way for deliveries and safe, at-the-curb pickups.
These companies began their digital transformation early on and have clearly benefited from these decisions during COVID-19.
What can companies learn from these examples?
There has never been a better time to start accelerating your revenue growth strategy in this COVID-19 world. In our next blog, we will dive deeper into how you can balance growth, cost and innovation to free up cash for innovation such as new digital as-a-service business models beyond your Digital Burrito.
Sources:
1 Forbes
2 The SaaS CFO
3 PYMNTS.com
4 RESTAURANT DIVE
5 Digital Commerce 360
6 ZD Net