No doubt you’ve heard the term that’s been in vogue with entrepreneurs for a few years: Pivot your business.
As a skeptical outsider, it looks like an excuse for someone getting bored, who can’t commit to the hard work of building and running a company. And there is some truth to that.
But it’s not the whole story.
To pivot means that you redefine the business in a substantial way to make it better. Usually it’s based on learning something about what customers are ready to buy. The pivot might be to change to a different business model, target a different customer, or redefine the product. Something deeper than just changing your marketing messages.
Using pivot as an excuse to exit one business and move to another? That can indeed be an indication that you’re not ready to invest in the hard work it takes to create a sustainable company.
What’s the difference?
Pivoting is a good idea when you’ve learned and incorporated what you learned. If you moved from insurance to essential oils, chances are you didn’t learn much that could be incorporated into the new business. Sure, you may have learned important new skills, but the rest of the business knowledge is going unused.
I had the chance recently to catch up with a gentleman who has struggled to gain traction with his original business model. He has a new concept, so a lot of his marketing has been spent on educating potential customers about the benefits, and why they should care.
It’s exciting to see that he hasn’t given up. He’s learned. For instance, customers often don’t use the product the way he had envisioned. Same product, similar benefit, but a different usage model.
Through deep industry research, he’s also been able to locate some surprising ways to address the need with higher profit. Those are the kinds of things you only learn when you stick with something for a long time.
He’s also learned how to reach a much broader online market than what he can reach in the local area. So his expansion plans have become much more realistic. He’s not just slapping together an Amazon storefront and assuming customers will flock to it.
All this time, he’s been careful to leverage his scarce resources of time and money. I’ve seen too many entrepreneurs who look to leverage others’ investment, then squander that money by moving faster than they can learn and adapt.
It takes time and focus to learn what customers need and how an industry works. It takes even longer if you’re introducing a disruptive concept into the market.
If your business is failing because it’s not viable, by all means look to deep changes. Exiting may be one of the paths you consider. But since an industry can have viable opportunities that you haven’t exploited yet, also look for changes based on what you’ve learned.
- Change your target customers.
- Redefine your product.
- Change your business model.
If you’ve learned that there is no viable way for you to create a sustainable business in this market, then pull the plug. Markets change, opportunities come and go. This might not be the right time.
But don’t shift just because you’re bored and see some hard work looming. Creating and leading a business takes fortitude.
Carl Dierschow is a Small Fish business coach based in Fort Collins, specializing in companies committed to improving society and the world. His website is www.smallfish.us.