Through all the challenges and struggles caused by the coronavirus pandemic, there has been an outpouring of care, creativity, and innovation. Artists have moved their performances and pieces online, wowing audiences and helping them through periods of anxiety and stress. Businesses have found new ways to thrive, changing direction by reaching new audiences or offering new products at speeds that would have seemed impossible 6 months earlier.
You can be part of this change. If you have reached a crossroads where you need to pivot to survive, know that the challenges you face can help you grow your business and come out on the other side stronger than ever.
1. See How Your Target Audience Has Changed
If you want to make a change, research can help you understand the risks involved and guide you in the right direction. After all, you didn’t open your business without conducting market research and understanding the industry, so why would you pivot without the same amount of care?
During this period, you may need to conduct first-hand research to understand your audience. Any data before 2020 is likely outdated if your customers’ behavior changed dramatically during the pandemic. Take time to learn what your customers are doing and what they are feeling during this time.
2. Look at Industry Trends and Watch Key Innovators
There is good news that comes with your plan to pivot: you don’t have to reinvent the wheel!
Thousands of companies are scrambling to make changes right now, and others in your industry are likely pivoting, too. Check out what other brands are doing and see if you can follow their lead with new products, services, or options.
For example, would your target audience benefit from a subscription service? Could your restaurant sell recipe kits for at-home cooking? If the business model works for another player in your industry, it might work for you.
3. Start With Temporary Products or Services
One of the main ways to reduce the risk associated with change is to only make it temporary. Instead of viewing your pivot as a dramatic change, test out a few new options and see how your customers respond.
Testing isn’t anything new. Businesses have been testing new services and products through pop-up shops or testing markets for decades.
The trend of pop-up shops has become even more popular with brands like Best Buy and Nordstrom setting them up throughout the country. In fact, the pop-up industry generates more than $10 billion in sales each year, with 39% percent of shoppers wanting unique services or products.
Test the demand for your new business model through a pop-up shop or other forms of beta testing. If your customers like the experience, you can start building excitement for when the change becomes permanent.
4. Create an Innovation Budget
If you don’t have an innovation budget already, now is the time to develop one. This is something you can set up for the pandemic but continue to use once the restrictions are lifted.
An innovation budget is used by companies to experiment with new ideas, products, and marketing opportunities. It is meant to be applied to unproven higher-risk initiatives but could have a massive upside. It is the budget you set aside to use during the year when a unique opportunity presents itself.
“An innovation budget pre-designates financial resources for strategy adaptation, but it does something even more important: it mentally prepares you to think on the fly,” Molly St. Louis, a creative executive, writes at Entrepreneur. “When your company is positioned for innovation, you’ll embrace change. That gives you the competitive advantage of the forward-thinking.”
Hand over your innovation budget and let a few of your team members run with it. They can test different products or consider pivoting your marketing strategy to attract new customers.
5. Encourage Employees to Take Risks
Once you’ve established an innovation budget, the next step is to begin taking risks and trying new ventures. Unlike launching new products or services within your market, consider trying drastic overhauls—sometimes in completely different industries.
The company behind Twitter, for example, began as a podcasting platform called Odeo. Once they began losing market share to iTunes, they pivoted to using their technology to enable people to share status updates in real time. The company is now valued at more than $31 billion.
Pivoting your business can involve subtle changes to your product and service offerings or large, sweeping overhauls. Think about your core competencies as a business and whether you can leverage your knowledge, technology, or other resources to offer something completely new and innovative. Test these ideas and competitive advantages to determine if there are more profitable avenues for your business.
By taking risks, you can continue to innovate and evolve. This flexibility will help you determine the best path forward—even if it’s not what you expected.
6. Don’t Bank on Future Timelines
If there is one consistency in 2020, it’s that you never know what can happen. Most people thought this pandemic would be over by summer and still have hope that it will have passed by the new year. However, you cannot look at a specific timeline and plan around it.
For example, if you run a seasonal business and hope the holiday shopping months will create a surge of demand, you can’t count on it. Looking ahead, you should already develop contingency plans and back-up options to make it through the worst-case scenarios.
Now is a great time for your business to pivot, if only because you can create a “new normal” and grow your sales in a manner you can control. The goal of this change is to add stability to your business instead of waiting for the pandemic to pass.
7. Know That Loyal Customers Want to Support Your Brand
If you have built up a strong customer base and a large amount of community support over the years, know that people want to help you. Your customers want to continue supporting your business and will likely be excited about the changes you have in store.
Your top customers will want to try out new products and share them with others. Yes, pivoting is a risk, but if you do it for the benefit of your customers, they will return the care and support you.
Change is always scary, but most people have faced their fears (and then some) this year. Instead of waiting for everything to return to normal, take steps to pivot your business into a better, more resilient normal.