Is Winter Coming for Your Business? Addressing “The Pivot”
In George R.R. Martin’s popular series of fantasy novels, “A Song of Ice and Fire,” which you probably know from its HBO television adaptation “Game of Thrones,” the ominous creed the Stark family lives by is, “Winter is coming.”
It’s a truism. If you live in northern climates (like us!) you recognize this as a literal inevitability: It’s going to get colder. But “winter” can also represent difficult times on the horizon, where resources will not be as plentiful or the environment as forgiving.
So, how does a business weather a disruption? By executing a pivot.
What is a Pivot?
When discussing startups and business challenges, “pivot” is generally understood as a sudden change in direction, like changing a product or service.
That general understanding limits the actual meaning of “pivot.” In Do Pivots Matter?, author Steve Blank describes a pivot as follows: “A pivot is not just changing the product. A pivot can change any of nine different things in your business.”
The nine things Steve refers to:
- Customer segments
- Revenue models
- Customer acquisition
The key is that the change is substantive. Minor tweaks and “testing the waters” don’t quite rise to the level of a pivot. Another key is that the pivot comes just at the right time.
Why Marketers Should Become Experts in the Pivot
Much written about the pivot focuses on startups and general business decisions. We often hear about significant pivots, like Paypal’s—a company originally founded to help facilitate payments between smartphones, but (thanks to a pivot), ended up becoming one of the preferred methods for making any kind of payment online.
Paypal’s pivot represented a significant shift in its overall business model. One that involved shifting Paypal’s customer segments, channels, resources and activities.
Marketing is interwoven into a business’s overall strategy (or at least, it should be). When a business decides to pivot, its marketing team needs to be onboard and needs to quickly adjust and adapt their tactics.
Even absent a pivot in business model, marketers should still become experts in recognizing pivot opportunities within marketing. Even a shift in marketing messaging can represent a pivot—particularly if the pre-pivot messaging isn’t supporting the current direction of the business.
Recognizing When It’s Time
Unlike the changing seasons, where the leaves slowly start to turn and the weather gets cooler, recognizing the time to pivot is more difficult.
Here are some scenarios that tend to be indicative that the time is now:
1. High value proposition, low engagement.
You may have a killer product or service, but your market just isn’t resonating with it. Don’t completely scrap the value—look for different ways (markets, channels, costs, etc.) and better, sharper messaging to better convey its high value and attract more attention.
2. Market is unripe.
Remember the dot-com boom? One of that era’s most famous failures was Pets.com, a website that sought to sell pet supplies to customers online. The idea seems normal nowadays – how many companies sell pet supplies online today? – but back in 1998, it was novel. Unfortunately, the market wasn’t yet ready, and the business failed. What would Pets.com look like today if the business had successfully pivoted? We’ll never know.
3. You’re feeling burned out.
Burnout can affect any member of your team—from the CEO to the intern. Think about the kinds of marketing materials you’re putting out—is your heart still in them? If not, you may be feeling burned out, and it’s time to change the script.
4. You keep hearing the same things from your customers.
Listen to your customer feedback. If your customers are consistently asking for something different, it may be time to switch gears.
Traits of a Successful Pivot
Pivots take guts and a little luck, but you improve the chances of pivoting successfully by modelling others who pivoted excellently before you. Here are three important traits of businesses that have successfully pivoted, courtesy of the Harvard Business Review blog:
First, these businesses knew their customers. Raw data and statistics about customers is all well and good, but knowing what motivates them and what they care about is much better. Additionally, business culture should be built with the customer in mind, as opposed to just the product.
Second, these businesses keep the insights they glean from customers around. The HBR refers to this as “composting ideas.” Just because one idea didn’t resonate with your customers doesn’t mean you have to toss it out completely; take what you can from it and reserve those insights for later.
Finally, these businesses weren’t afraid to fail, and even where they did fail, they failed as cheaply as they could. You can A/B test ad copy and material to a limited audience before committing to a larger campaign, for example. You can focus-test messaging and design. It’s okay to fail—that’s how you’ll learn and how you’ll be able to compost ideas and glean insights.
Now that you’ve learned about the pivot, learn about the other ways you can adapt to change by reading our new eZine–Weathering Change: Your Guide to Seasonality and Business Fluctuation.
photo credit: Verde Canyon Railroad via photopin cc