The digital economy is here to stay and, with it, digital business. E-commerce, cloud services, data analysis and artificial intelligence (AI) dominate the changing face of business and relationships and how we engage with each other and the world. It has forced huge change especially in how businesses work, add value and connect with customers. This article will explore the key components of digital business, looking at what it is, the options available to study digital business and what a digital business programme is.
What is digital business?
Generally digital business refers to the use of digital technologies and resources for day-to-day business to earn revenue and deliver top class and meaningful customer experiences. True digital businesses are built from the ground up with tech at their core. They thrive on innovation, make decisions based on data, and engage with customers online. Some features of digital businesses include automation, real-time data analysis, cloud operations, savvy digital marketing and smooth online experiences for customers. In traditional setups, tech is more of a sidekick, helping out with accounting or communication but not really changing the game. Digital businesses weave technology into everything they do, shaking up key areas like product development, supply chain, marketing and customer service. Digital businesses tend to be quicker on their feet while traditional businesses often stick to slower, more rigid models. This deep integration of tech in digital business leads to better efficiency and quicker responses.
Core components of a digital business
What is digital business all about? A successful digital business relies on a handful of essential components:
- Digital services: we're talking about software, apps, streaming platforms and useful online tools. Even traditional businesses are getting in on the action. Banks are going digital and fitness trainers offer workouts you can do from your living room.
- Online customer services: in the digital world, most customer connections happen online. Consider customer support via chatbots or social media, personalised email blasts, and user-friendly websites or apps that make shopping seamless.
- Digital marketing magic: it’s all about using social media, search engine optimisation and content marketing to catch the eye of your ideal audience.
- E-commerce platforms: if you're in the game of selling online, e-commerce platforms are your best friend. They make it easy for businesses to connect with customers worldwide, offer payment options and manage inventory like pros.
What is the importance of data and analytics? Companies use them to track customer behaviour, spot market trends and assess how well they're doing.
The importance of digital transformation
Digital transformation is not just about turning old processes into digital ones. It’s a whole new way of thinking, shifting company culture, and revamping strategies to welcome innovation, make decisions based on data, and adopt flexible business models. In today’s digital-first economy, companies that don’t keep up are in serious trouble. Digital transformation helps businesses quickly adapt to changes in the market, meet customer demands and keep up with tech advancements. Plus, it opens doors to new revenue opportunities, makes operations more efficient, and enhances the ability to innovate on a larger scale. What is this digital business? Some examples of companies that have got it right:
- Netflix: did you know Netflix started as a DVD rental business in malls? By becoming a streaming service, Netflix became a giant in digital transformation. Today with millions of subscribers, Netflix has transformed how we watch media.
- Checkers: This local retailer has made waves in the retail sector in recent years, far surpassing its competitors. It’s hugely successfully Sixty60 grocery delivery app, which lets you order groceries online and have them delivered in just 60 minutes, has seen remarkable growth in a short space of time. The company also uses data analytics to level up its award-winning Xtra Savings rewards programme.
Starting a digital business
- Step 1: find a niche or business idea that fits your skills and what people want and conduct market research.
- Step 2: create a solid business plan.
- Step 3: choose tech platforms that fit your business.
- Step 4: create a website or app that’s easy to use and optimised for search engines (SEO).
- Step 5: register your business with the right authorities, secure a domain name, and protect your intellectual property. Comply with consumer protection laws, tax obligations and regulations like POPIA in South Africa.
- Step 6: launch your business with a smart marketing plan to attract those first visitors.
Breaking down the different digital business models
Different models offer different benefits – and risk. Subscription services bring in consistent cash but need constant fresh ideas. Freemium models lure users in with free stuff, making money off premium features. On-demand platforms can grow fast but have to deal with tricky logistics. E-commerce lets you sell worldwide but is competitive. The ad model thrives on high traffic but has to keep users engaged.
Importance of digital marketing and customer engagement
Digital marketing helps grab and keep customers. Strategies like SEO help businesses rank better on search engines, making it easier for potential customers to discover them. Content marketing shares useful info that attracts and educates users. Social media keeps the conversation going and builds loyalty, while email marketing helps maintain long-term relationships with personalised messages.
Challenges and risks in digital business
Cybersecurity issues are some of the biggest challenges for digital businesses; hackers, data privacy breaches and bad actors can cause huge damage to businesses and stakeholder trust. To tackle these problems, it's vital to set up strong security measures, mix up tech usage, support and educate customers on the risks associated with digital use, and be transparent with them if and when things go wrong.
The future of digital business
The future of digital business is all about AI, machine learning, and blockchain tech. These innovations are set to change the game for how companies operate. To keep up, businesses need to focus on ongoing learning and keep focused on developing trends. For those wanting to deepen their skills and expertise, a Postgraduate Diploma in Digital Business is a great asset, providing the ability to understand, assess and select appropriate business technologies for growth and effectiveness.
About The IIE’s Varsity College
The Independent Institute of Education (The IIE) of which Varsity College is a brand, is South Africa’s largest registered and accredited private provider of higher education. At Varsity College we understand that no two students are the same or learn the same. That’s why we make sure a student’s education is shaped around them; how they like to learn, what they are passionate about, what makes them tick, and what makes them thrive. Our Education by Design approach allows students to grow into their best, and creates a space where they can live, learn and play – their way.