Conceptualization of a Data-Driven Digital Strategy Model in Driving Product Innovation and Differentiation

Abstract

Data-driven digital strategies have become a crucial pillar in strengthening an organization's competitive advantage. Digital transformation not only changes internal workflows but also significantly influences innovation and value creation through product differentiation. This study aims to conceptually examine a model of data-driven digital strategy and how its implementation drives innovation and differentiation in products or services. Using a literature review approach from various national and international scientific journals, it is found that the integration of digital data into strategic decision-making accelerates the innovation cycle and aligns products with the dynamic needs of the market. The analysis shows that companies successfully applying personalized and automated digital strategies tend to have a higher level of product differentiation. This research highlights the importance of organizational capability in managing, analyzing, and exploiting digital data to design adaptive and competitive innovative strategies. A data-based approach in digital strategy is increasingly vital in achieving sustainable strategic transformation and gaining a long-term edge in today's fast-evolving digital economy.