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Digital business model

Why read this? : Learn how our RESTART digital business model works. We show how you can use it to map out all your digital activities. This includes customer-facing activities like digital media, websites and online stores. And it also includes underlying enablers like data, technology and resources. Read this to learn how to get the most value from your digital business model. 

Digital business model

How this guide raises your game :-

  1. Learn the 7 key elements which make up a successful digital business model.
  2. How to drive reach, engagement and sales objectives though digital.
  3. Understand the transforming role of technology, data and resources in your digital business model. 

‘Digital’ is a broad topic in the business world. In simple terms, it’s how you use technology to achieve your objectives. But dig deeper, and there’s lots of ways ‘digital’ can do that. 

Your digital business model and plan helps you work out which activities you need. It helps you work out how everything digital fits together.

It needs to cover customer-facing digital activities. Your digital media to reach customers for example. Your website plan to engage and interact with customers. And of course how you sell online. Do you go through online retailersSet up your own online store? Or both?

You also need the right set up behind the scenes to make these things happen. The right marketing technology for example. A way to capture digital data and analyse it to find digital insights. And the right resources in terms of  people, budget and time. Those all take a lot of planning. 

Set up your digital business model correctly and it can transform your business. In this guide, we’ll show you how to do that.

Scrabble tiles spelling out Digital Marketing laid out on a wooden table

Ready to test your knowledge?

What’s your starting level of knowledge about digital business models?

Take the 2 minute, 5 question Three-brains digital business model quiz and see how much you know about digital business models already.

RESTART model

You need to be able to organise all these different digital marketing elements.

That’s your digital business model. 

Our RESTART model covers the 7 key elements you need in a digital business model. These are :-

  • Reach. 
  • Engage. 
  • Sell. 
  • Technology.
  • Analysis.
  • Resource. 
  • Transformation.
The Seven Steps of the RESTART digital business model - Reach, Engage, Sell, Technology, Analysis, Resource, Transform

We’re sure you already spotted the initial letters of each element spells out RESTART. Digital gives you the chance to restart your business from where it is now. Plus, it makes a nice acronym that’s easy to remember. 

In this guide we cover the basics of each area. But you’ll also find links to more of our content if you want to delve into a topic. Our main aim is to show how everything connects together in your digital business model.

Reach

Let’s start by reaching into reach

In our media planning guide, we cover the traditional channels where advertising reaches customers. For example TV, radio, print, cinema and outdoor. But, these days there’s also many reach opportunities in digital media. Lots of new ways to reach your target audience

Brands now have direct access to customers via sites like Google and Facebook. You have more options and control over how your messages reach your audience than ever before. 

How much you should use digital for reach really depends on your target audience. Look at what they do online. Work out if digital media helps you reach them.

There’s no doubt digital reaches many people. The global average for internet penetration is almost 60% for example. But in developed countries, it’s much higher. In Australia, internet penetration is 86.5%. 60% of Australians use Facebook. The average Australian spends over 5 and half hours online every day.

Chances are your target audience will be online. And that’s an opportunity to reach them with your digital media

Digital media hasn’t replaced traditional media. There’s still ads on TV. On billboards. In magazines. But digital has changed the way customers experience media. Because customers are now exposed to media in many new places. And they can interact with the media in those new places. 

Find out where your customers go online

Watch what people do when you’re out and about. What do you see people doing in cafes, on public transport and even (annoyingly) in the cinema?

Yep, they’re on their mobiles. But most of the time, they’re not on calls. They’re looking at things online. Cat videos. Instagram posts. Shopping sites. 

They connect to the wider world through their device. They expect quick answers and results at the touch of a button.

Your digital business model needs to understand and meet these expectations.  To understand where customers go online and what they want

Young woman on train station platform looking at her mobile phone

There are a couple of ways you can do this. 

First, ask your customers what they do online. Either informally or via qualitative market research. This is relatively simple, cheap and fast to do. 

You can build a list of sites your target audience visits. That’s a good place to start. For example, there may be some high authority sites customers regularly visit. Sites which are educational or review based. That’s helpful to know. However, you also want to understand how many people visit those sites too. And what they do on those sites. 

So, you can also carry out secondary research to look for more quantifiable data. Look online with tools like Google Trends. Use published reports and government websites. There’s loads of data sources when you start looking.    

Also, digital media channels will often share their traffic numbers and behavioural trends. They do this to encourage you to buy digital media space on their platform. 

If you have the budget (and time) you can also work with companies like Similar Web who collate online data. Or you can ask your customers directly with quantitative research to find out what their favourite sites are. 

The goal for reach

To succeed at reach, your digital media has to put your messages in front of the right customers at the right time and in the right places. When and where they see your brand influences whether they notice you. 

This means you need good digital media planning. You need to work out which channels and which messages will work best to deliver your business objective.

It’s firstly about quantity of audience. How many people you reach. But it’s also about quality of audience. You want to reach high potential customers at moments which will be relevant for them. 

Mobile phone screen showing two alerts, one from Twitter and one from What's App

Your main options are usually SEO, social media and online display channels. Our digital media guide covers these in more detail. It also shows how they connect to your overall media planning.  

Engage

You need to plan what you want customers to do after they see your advertising.

Your advert needs a clear call to action which tells them what you want them to do.

With digital advertising, you add a link to make the action immediate. The link can take the customer to your website, social media or online store.

This immediacy is one of the areas where digital media works wins over traditional media.

The action can happen right away.

Man holding a mobile phone reading a message notification with a desk and keyboard in the background

In traditional media, there’s a gap between seeing the advert and acting on it. That gap might mean your advert gets forgotten. Something else catches the customer’s attention. This doesn’t happen with digital. There’s an immediate interaction which improves the impact of your advertising. 

Digital media platforms are set up to make this immediacy and interactivity easy for the customer. The call to action is only a touch of the screen away.

Facebook for example, currently offer 16 different call to action buttons. Which you choose really depends on your advertising objective.

Take this Three-Brains advertising example. Our advertising objective was to drive brand awareness. And we wanted our target audience to learn more about us.

So, our call to action on this marketing coaching advert was learn more. But if we were advertising products on our shop for example, it would have been shop now.

We could also have used contact us, download and subscribe if those were our objectives.

Call to action - website

Often, the action is to take customers to your website and a landing page. As part of their customer experience they’d do something on that page. Read an article. Watch a video. Request a demo or a quote.

It’s an important stage in the brand choice funnel. Because this engagement is a significant indicator of interest. It shows your brand has moved from awareness to consideration. 

On your website, you can use marketing technology to automatically handle the interaction. A newsletter sign up or an online purchase for example. Done well, these interactions drive consideration and word of mouth for your brand. We cover more examples of how this works in our website strategy guide.

Of course, not every engagement drives a sale. But we’ve regularly seen a strong correlation between engagement and sales. Customers only engage with what interests them. And what interests them is often what they end up buying.

Call to action - social media

However, engagement also works in other channels. Customers can engage with you on social media channels for example.

They watch a video on You Tube. Or they look at a cool image on Instagram. Or they comment on a post on Facebook or Twitter.  

Monitor your social media pages regularly. Respond to comments and feedback in a timely and relevant way.

Use the opportunity to create stronger connections with customers. This makes them feel more positive about your brand. And of course, that makes them more likely to buy.

Other engagement opportunities

Finally, you can also look at developing apps to meet the needs of customers. These apps can help you educate or entertain your target audience. They’re designed to engage people. 

They can be a way to get customers to spend a lot of time with your brand. However, it’s a very cluttered area. You need something unique and relevant Something which gives a lasting benefit to customers. People have on average 60 to 90 apps on their phones, but 96% of the time is spent looking at the top 10 most relevant apps. 

These apps also now extend to voice-activated devices like Siri and Alexa. These are growing in use. They’re another way for brands to engage. But they’re still relatively small in terms of how many people use them.

Even in advanced markets like the US, voice is only being used in around 1 in 3 homes according to the latest estimates. 

Sell

Engagement is great predictor of sales. But what actually pays the bills is when the customer buys something. Digital needs to sell.

E-Commerce makes online shopping easy.

It’s never been easier or more convenient for customers to shop online. 

What you need to do though is work through how your reach and engagement activities link to customers actually buying online in your digital business model. 

As per our e-Commerce strategy guide, you’ve a couple of different options when it comes to selling online.

Person paying for an e-Commerce purchase as they hold a credit card up in front of a laptop

Bricks and clicks

If you currently sell through traditional retails channels, these retailers will likely also have online stores. You can work with them to sell your products through these stores.

Customers already trust, know and use these bricks and clicks retailer already. They offer you a ready pool of ready and willing shoppers. 

However, because it’s their site, you have little control over how your products are sold. They set the selling rules for suppliers. And you have to comply if you want them to sell your product. 

You supply images and copy through their product information management system. That gives you some control over your product page. But the retailer controls the overall design, layout and the order to delivery system. 

You also have to pay to advertise on their sites. And you have to pay if you want your products to appear in prime positions where shoppers are most likely to see them.

Pure players

The same applies with new pure player channels like Amazon, E-Bay and JD. Again, these online retailers control how and where your product appears. And they charge for advertising and use of their services.

Their competitive advantage is that they only do e-Commerce. This often means they’re faster at implementing new technology and processes.  They offer more personalised experiences for shoppers for example. And they often offer faster and more convenient delivery options.

In the long-run, these services will continue to attract more online shoppers. So, as part of your digital business model, you need to include these pure players in your plan.

Samsung mobile phone with amazon logo on screen

Set up your own online store

Your final option is to set up your own online store. This direct-to-consumer or D2C digital business model, give you the most control over the selling experience.

There’s no third parties involved in the selling. That’s good for your profit and loss. What the shopper pays is how much income you get. 

However, you also need to cover all the delivery costs. Plus connect systems and functions needed to run your own online store. That’s not easy. It takes time and skills to set up. It takes time to manage properly. 

See our setting up an online store guide for how to deal with these challenges. And check out our e-Commerce capabilities article for more on the skills and systems you need to succeed. 

Screengrab of Three-brains Shop - headline says "merchandise to raise your game"

Technology

Having planned your customer-facing activities, next you plan how you’ll do those things.

This is sometimes called the ‘back-end’ or ‘back of house’ of the digital business model.

This is because customers won’t see or be aware of these digital activities.

But without them, your online experience won’t work. 

The first of these enablers is marketing technology. Marketing technology has changed a lot in the last 10 years.

As the latest statistics show, there are now over 7,000 marketing technology suppliers to choose from. It was less than 100, 10 years ago.  

There are 4 marketing technology types to review as part of your digital business model.

Marketing technology - reach

First, there’s technology which supports your reach objectives. All your digital media channels are enabled by different software, technology, systems and processes.

Your digital business model needs to cover how you access these. Who manages the access? How do you maintain and improve these systems? You need people with the right skills to do set these up and manage them. 

Marketing technology - engage and sell

Then, there are the technologies which support your engage and sell activities. For example, e-mail, CRM, online store websites and customer service systems.

It’s technology which handles the customer interaction. And it’s technology which triggers the next action in your system.

Automated welcome e-mails for newsletter sign-ups to drive engagement for example. Automatic re-orders if you run a subscription service. These types of actions all have technology requirements.

 

Marketing technology - data and analysis

Next, there’s the technology which helps you capture and use digital data. Online forms, databases and reporting tools for example.

You analyse these to look for insights so you can work out how to better meet customer needs.

Digital data is part of your overall market research plan. It’s another way to understand customers better.

The technology you use here helps you generate ideas which go into your marketing plan. When those ideas go live, the actions they drive create more customer interactions which creates even more data. Those feed your next round of ideas and activities.

Marketing technology - enable and optimise

Finally, marketing technology also shapes how you deliver your online experiences.

You use it to enable and optimise what you do.  For example, there’s how you create and organise your content with Content Management Systems (CMS). There’s how you manage approvals of content with approval systems. You can use this type of technology to work from different locations, schedule events to happen when you’re not there and automate actions on your website.  

Which technology goes into your digital business model depends on your objectives and budget. But minimum requirements for most businesses usually cover websites and customer relationship management (CRM).

Analysis

While marketing technology helps you capture data, you still need to do something with it. That’s where analysis comes in. It’s about listening to customer feedback. About looking for trends and patterns in the data. 

Every piece of data you have comes directly or indirectly from an interaction with the customer. It’s a key digital skill to be able to pull the data together and convert it into insights. These insights drive you decision-making and your marketing planning. 

There’s normally 2 levels of data you analyse :-

  • aggregate data.
  • one-to-one data. 
Mobile phone showing Google, with the word "analytics" in the search bar

Aggregate data

Aggregate data covers groups or segments of customers. Most of your website data will be aggregated for example. You see how many visitors came to your site on a specific day. Or how many visited a certain page. But you don’t know which individual visitors they were, The data’s aggregated. You can analyse this type of data to plan activities and experiences at a broad level. 

For example, activities to reduce the number of people who bounce from your home page. Or who add to cart, but don’t complete a purchase. 

One-to-one data

However, in some situations, you do know who the individual customer is. Customers who signed up for a CRM email newsletter for example. Or who order from your D2C store or join your subscription service. 

This one-to-one data is very valuable. You get more insights about specific types of customers. Plus, you can use that to create more personalised experiences for them. Personalisation makes everything more relevant to specific customers. 

However, it does come with some challenges. Legally, you need to protect their privacy. You also need secure IT systems to make sure you set-up and manage the data properly. 

Check our digital data guide and digital insights article for more on these challenges. See also our B2B CRM article for how this impacts business-to-business customer interactions. 

Resource

Next step in the digital business model is to work out “who” is going to do all these activities. You also need to work out “how” you will make these things happen. Do you have the right e-Commerce capabilities in-house for example? Or do you need to engage an e-Commerce expert and/or marketing agency? 

In our customer experience guide, we show the resources you need to put in place at each step of the customer’s journey. Someone needs to make those things happen.

But resources aren’t just bums on seats. It’s also time and budget. How long will it take to do your digital activities? How much will it all cost? When will you see a return on this investment? 

These are the sort of resource questions you need to cover in your digital business model. (see also our how to be a better digital marketer guide for more on this).

Transformation

Finally, we get to the last piece of your digital business model. Now, it’s all about Digital Transformation.

You’ve probably heard people talking about it, right? It’s a favourite buzzword among leaders and consultants. 

But to turn it from being a buzzword into something real which makes a difference to your business, you need to dig into what it really means. 

In simple terms, you work out what a future version of your business looks like that’s taken full advantage of the digital opportunity. Then you put together your plans for reach, engage, sell, technology, analysis and resource to show how you’ll become that version of your business.

Neon sign showing the words The Journey is on

How what your business does online in the future is different to what you do now. How customers will experience you differently. It’s about what you’re going to do. 

But digital transformation takes time. It’s not a sudden ‘aha’ moment. It’s a process where you work out how to change your business over a period of time. 

Change management

During this change process, you focus relentlessly on the interactions between the brand and the customer. You work out how to bring new skills, systems and processes into your business, while keeping both customers and your team happy and engaged. It’s about driving change. 

If you look at the start and at the end, yes, businesses can be ‘transformed’. But, the underlying process is all around setting up your culture to be customer focussed. And having a clear ‘change management’ plan. 

To be honest, we’re not big fans of the word “transformation”. It overpromises and underdeliver. We prefer calling it “change”. But unfortunately the “C” from change doesn’t work in our RESTART acronym, while the “T” from transformation does.

Still, being flexible and adapting to the situation is a key part of change management. 

So, Transformation it is. 

Conclusion - digital business model

There’s no doubt digital marketing is a big opportunity area. New ways to reach, engage and sell to consumers. New ways to be faster, more targeted and more interactive. You need to define your digital business model to work out how you’ll take advantage of these opportunities. 

But, it’s also a challenging area. It’s still relatively new. Best practice is regularly being updated. There’s no single best way to do it. 

So you gets lots of noise and wild opinions. See our article on the start-up stalkers for example. You know, those ones who bombard your inbox and social feeds with sure-fire ways to drive success online. When of course, the only “sure” things is it’s going to take a lot of hard work to succeed. Hard work to raise your skills and put the customer first in your digital business model. 

Of course, digital marketing doesn’t operate in isolation. The core concepts of traditional marketing just apply. It’s just that digital adds something new to your marketing playlist

Your digital business model really only works when everything works in harmony. Our RESTART framework is designed to help you bring all the elements you need together to really make your digital activities sing.

Three-brains and digital marketing

We’ve worked on many digital marketing projects. Our expertise and experience experience stretches across all aspects of digital marketing including digital media channels. We know how to connect digital media planning back into driving your brand marketing and growing your sales. 

Contact us, if you want to know more about how we can support your digital marketing to grow your business  through our coaching and consulting services.

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