4 Tips for Successfully Pivoting Your Startup
By taking these practices into consideration, entrepreneurs can continue to grow their businesses and stay ahead of the competition.
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There is no question starting a business is hard. Indeed, some reports show that as many as 90 percent of companies ultimately fail. However, as any seasoned entrepreneur will tell you, establishing a viable business is only the first in a long line of challenges an owner will face. What makes the difference for the 10 percent of companies that succeed? While there are certainly a number of variables to take into consideration, one of the most crucial is knowing when to pivot and how to do it successfully.
Here are four best practices for pivoting:
1. Beef up your executive bench
The market is crowded. In fact, according to the 2015 Kauffman Index on Startup Activity, this year saw the largest year-over-year increase in startup activity in the past two decades. With new players entering the marketing on a consistent basis, your business can't afford to be stagnant in its thinking. What may have worked 10, five or even just two years ago may not work in today's constantly evolving business environment, especially the technology industry. When considering a change in direction, it's critical to bring in outside perspectives, different experiences and fresh thinking.
2. Listen to the customer
One of the top reasons companies fail is that they're offering a product or service that no one wants -- and with no need in the market, your business is basically dead in the water. When considering the rollout of a new offering, take a reverse engineering approach from the perspective of your customer. That is, if you were a customer, how would you change your company's current offering. To be successful, you must pivot according to the needs of your customers. So, be sure to listen first, act second.
3. Remember that product is king
You can invest all the money in the world in sales and marketing, but if you're bringing a subpar product to market, no amount of marketing dollars will fix it. Be sure any new offering has been fully tested and vetted and is ready to go to market before initiating the sales and marketing arm of the launch.
4. Bring your current customers on board first
As you develop new offerings, make sure your current customers are on board. This has several potential benefits. First, if customers have had the opportunity to weigh in from the beginning and the offering has been developed accordingly, you're ensuring a built-in sales channel once the product goes live. Second, as you bring the new offering to prospects, current customers will serve as ready made case studies, offering potential customers third-party validation and an already established market presence.
Pivoting the business or introducing a new core offering is a momentous and decisive time for any company. By taking the above practices into consideration ahead of such a move, entrepreneurs can continue to grow their businesses and stay ahead of the competition for continued success.