Pivoting: it’s not Just a Ballet Term Anymore
The idea of pivoting, or changing an aspect of a company to better meet market demands, has become a lifesaver for many entrepreneurs. Rather than calling it quits, entrepreneurs are choosing to reevaluate and pivot their startups, often taking their businesses to new heights.
The first thing to understand about pivoting is that it isn't giving up. In fact, it’s quite the opposite. Many household companies pivoted during their early phases to avoid bankruptcy.
For example, Nokia used to manufacture rubber boots and paper before pivoting into the technology industry. YouTube was a dating site once upon a time and the Marriot began as a root beer stand in Washington D.C!
One of the most important aspects of pivoting is identifying the correct time to reevaluate. Here are some key indicators that a pivot may be in order:
- Product prototypes are underperforming
- Your company can’t get any sales traction
- Your company is having trouble getting funding
- The market forces have changed
There are many different types of pivots, it’s important to find the one that’s right for your startup. The best way to identify the pivot right for your small business is by identifying the strengths and weaknesses of your business. Here are a few different types of pivots to get the ball rolling.
Photo credit:http://www.theglobalmail.org/feature/ballet-of-the-giants/53/
- Zoom in/ zoom out: Sometimes you’re reach is too wide while other times you’re product is too closed-minded. One of the most popular forms of pivoting is reevaluating the product/businesses scope. In simple terms, if a certain aspect of your business works focus in on it. If your business only offers a small part of a service while the market calls for the whole service, look to zoom out and position yourself as a one-stop shop.
- Customer segment pivot: Reevaluate your target market. If you’re trying to sell to the wrong market, you’re wasting your time. This is a problem that can easily be avoided by conducting market research prior to launching. If you happen to find yourself experiencing this problem further down the line, take some time to evaluate what market segment your business appeals to and hone in on that market.
- Customer needs pivot: A good product or service should solve a problem, so find a way your make your product useful. This can also be done with a little market research. Never underestimate the power of knowing the market and your customers.
- Business model pivot: This is a common form of pivoting. If your business isn’t working, try taking a look inwards and evaluate your company’s info structure. Turn back to your business model and try again.
- Channel pivot: Change the way you deliver/advertise your product. Conduct some focus groups and see what channels are more appealing to your target audience.
- Technology pivot: Keep up-to-date with new technologies. Technology is ever changing; don’t get left in the dust. One of the best examples of this was the release of the iPhone and the invention of “apps.” While many entrepreneurs launched from the base of the app phenomenon, many simply pivoted their business to run on iPhone and created apps for users to download.