case study company pivots

15 inspiring case studies of pivoting

Case studies of pivoting

Case studies of pivoting serve as inspiration, especially for many businesses that have had to make major changes in direction over the past year.

Pivoting means fundamentally changing the direction of a business  when you realize the current products or services are not meeting the needs of the market.

Conditions for a successful pivot

The Harvard Business Review says three conditions are necessary for such lateral moves to work.

• A pivot aligns with one or more of the trends from the pandemic such as remote work, and enhanced use of technology.
• A pivot is a lateral extension of the firm’s existing capabilities, not undermining its strategic intent.
• Pivots offer a sustainable path to profitability, one that preserves and enhances brand value in the minds of consumers. 

If examples help, here are 15 inspiring case studies of pivoting.

Case studies of pivoting (A-C)

• AIRBNB : In 2007, friends Brian Chesky and Joe Gebbia rented out air mattresses in their San Francisco apartment to conference attendees. All nearby hotels were booked out and demand for accommodation was high. They called their service Air Bed and Breakfast. However, they soon realized this business model wouldn’t be sustainable unless there were conferences. So, they pivoted to open the concept to travelers looking for cheap accommodation and an authentic local experience. Today,  Airbnb  is estimated to be worth about US$38 billion.
• BEST BUY : Focused on virtual support and technology repair with more people working online for school and business. 
• CONTEXT TRAVEL : Offers cultural walking tours in many cities. They changed to offering $35 online seminars as a test using Eventbrite to sell tickets. The test was successful, and a broader rollout is planned.

Case studies (D-N)

• MATTEL : Came out with a  new line of Fisher-Price action figures  that feature delivery drivers, grocery store workers, and healthcare professionals. Firstly, the pivot shows that Mattel understands the real superheroes that people are honoring these days.
• MIND THE PRODUCT : Puts on a series of large in-person events around the world. Instead of porting this format online directly, the team broke keynote sessions into a multi-day series of lectures that were shared free of charge. The goal was to use these online sessions to drive leads to their training business.
• NETFLIX : Viewers easily forget that a few years back Netflix was the service that delivered DVDs to your mailbox.  Netflix saw the writing on the wall for DVD viewing. Gradually the platform added a streaming service. Today many consumers no longer own a DVD player but are accustomed to streaming video on their phones, computers, and other devices.

Case studies of pivoting (P-R)

• PATAGONIA : Recently  expanded Patagonia Provisions  to include an entire marketplace of food from other companies—all with long shelf lives. From coconut oil to coffee, the new marketplace hopes to provide long-lasting food and maintain the global food supply chain.
• PLAY-DOH : Today a company called Play-Doh is well known and a part of many childhood memories. Many people fondly remember the aroma of opening a new can of Play-Doh.Few people realize that this beloved item was originally launched in the 1930s as a wall cleaner. The cleaning product was dubbed “Kutol”. Designed to clean coal heating soot from walls, Kutol experienced a decline in sales as gas heating grew in popularity.
• RED ROOF HOTELS : Offered day rates for workers. It allowed individuals to have a quiet, private space to work in which might be more comfortable and flexible and provide a needed change of scenery.

Case studies (S-T)

• SHOPIFY : Back in 2004, Tobias Lutke, Daniel Weinand, and Scott Lake attempted to open their own online snowboard equipment store,  called Snowdevil . However, they did not like any e-commerce products on the market, so instead, they built their own. The shop was not successful at all, but they loved the storefront they built. As a result, they decided to sell it to other businesses that needed a better online store. The rest is history.
• SPOTIFY : Before the pandemic, the company figured that advertising revenue would grow even faster than the free user base. A pivot was to offer podcasts. The platform saw artists and users upload more than 150,000 podcasts in just one month. It signed exclusive podcast deals with celebrities and started to curate playlists. The shift in strategy made Spotify more of a tastemaker.
• T3 EXPO : Atrade show and corporate events company, took their existing skills and tools for planning to transform a convention facility into a COVID-19 hospital. The company relied on its original foundation but applied it for a completely different type of need.

Case studies of pivoting (T-Z)

• TOV : A U.S. furniture manufacturer, managed to grow its business by 200% year over year. They went e-commerce. After the initial slowdown, people went to furniture because they wanted to upgrade or change what they were now seeing 24 hours a day while they were stuck at home.
• WITHLOCALS : Is a travel service where you spend time with a local experience something. When travel went down, they pivoted to offering online classes like pasta-making to experience a local market for a different perspective.
• YOUTUBE : “Tune In, Hook Up” was the unofficial slogan of the video-dating site YouTube that launched on Valentine’s Day in 2005. The concept never took off. So when the co-founders realized users were using the site differently than they’d intended, they pivoted. The breakthrough came when Co-Founder Jawed Karim posted the first-ever video famously saying elephants have “really, really, really long trunks”. This inspired users to post silly videos of themselves on the site. In 2006, YouTube was bought by Google for US$1.65 billion. It’s now the most popular video-sharing site on the internet with an estimated worth up to US$160 billion.

Do these case studies show you the value of pivoting? Could you business benefit from knowing how it can pivot

Rob Petersen

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Strategic Pivots in Startups: Deciding When, Understanding Why, and Executing How

Pivoting in the startup world is not just a strategy; it's a survival skill. In the ever-evolving business landscape, agility and adaptability are key to staying relevant and successful. This guide will cover the critical strategies that can help founders navigate through changes effectively. We'll explore when to pivot, understanding why to pivot, how to execute your pivot, and the different types of pivots that turn challenges into opportunities.

Understanding When It’s Time for a Startup to Pivot

Pivoting, a strategic shift in business model or product can be the difference between thriving and merely surviving. Founders should be alert to certain indicators that signal a need for change.

Identifying the right time to pivot requires a combination of market awareness, customer feedback, and internal business analysis. Founders must be agile, ready to adapt, and willing to embrace change to ensure their startup's longevity and success. By paying close attention to these indicators, startups can pivot effectively, turning potential challenges into opportunities for growth and innovation. Here are some key signs and factors to consider:

Identifying Signs That Your Startup Needs a Change

• Stagnating Sales and Growth: A clear sign that a pivot may be necessary is when your startup experiences stagnant or declining sales. This often indicates that your product or service may no longer be meeting market demands or that competition has intensified.
• Difficulty in Attracting or Retaining Customers: If acquiring new customers becomes increasingly challenging, or if existing customers are leaving, this could suggest that your product is not resonating with your target audience.
• Inconsistent Cash Flow: Erratic or declining cash flow can be a symptom of deeper problems in your business model or market fit, suggesting that a strategic pivot could be necessary.
• Feedback from Customers and Employees: Regular feedback, both from customers and team members, can provide invaluable insights. If there are consistent concerns or suggestions for improvement, it's worth considering whether these point towards a pivot.
• Technological Changes and Industry Shifts: Rapid technological advancements or shifts in industry trends can render your current business model or product obsolete. Staying abreast of these changes and being willing to adapt is essential.

Market Trends and Customer Feedback as Pivot Indicators

• Evolving Market Trends: Market trends can offer predictive insights into what changes may be necessary. By analyzing industry reports and market research, you can anticipate shifts and adapt your business accordingly. This is especially true in fast-evolving sectors like technology and consumer goods.
• Customer Feedback and Demand: Customer feedback is a direct line to understanding market needs. Regular surveys, focus groups, and review analyses can reveal changing customer preferences and unmet needs. Successful companies are those that adapt their products and services based on customer input.
• Competitor Movements: Observing your competitors can provide clues about market shifts. If competitors are pivoting or introducing new products, it may indicate emerging opportunities or threats that you should consider.
• Data-Driven Insights: Utilizing data analytics to track customer behavior, market trends, and business performance can highlight areas needing improvement or change. Forbes notes the rising importance of data-driven decision-making in identifying market opportunities and risks.

Planning Your Startup Pivot

Embarking on a pivot is a significant step, requiring careful planning and execution.

1. Introspection and Analysis

The first critical step in considering a pivot for your startup is introspection and analysis. This involves a deep dive into your current business performance and understanding the internal and external factors that affect your venture. Here’s how to approach it:

Gather Data

• User Feedback: User feedback is a goldmine of insights. Collect this through surveys, social media interactions, and customer support communications. According to a study in the Journal of Marketing, customer feedback is crucial in identifying product strengths and weaknesses, allowing businesses to align their offerings more closely with market needs.
• Sales Figures: Analyze your sales data. Look for trends such as which products or services are performing well and which aren’t. This analysis can reveal a lot about customer preferences and market demand.
• Market Trends: Stay informed about your industry's market trends. Tools like Google Analytics can provide valuable data on market behavior and preferences, guiding you toward potential areas of improvement or innovation.
• Identify Patterns: Look for patterns in the data. What are the consistent strengths across your offerings? Where are the recurring complaints or issues? This helps in pinpointing what's working and what's not.
• Areas of Potential Improvement: From the patterns you identify, determine areas that require improvement. This could range from product features, and customer service enhancements, to marketing strategies.

Conduct a SWOT Analysis

• Strengths: Identify what your startup does best. This could include a unique product feature, a strong brand identity, or an exceptional customer service approach. Knowing your strengths helps in leveraging them effectively during a pivot.
• Weaknesses: Recognizing and addressing weaknesses can significantly bolster a company's strategic planning. These could be limited resources, lack of expertise in certain areas, or operational inefficiencies.
• Opportunities: Look for external opportunities that your startup can capitalize on. These could be market gaps, emerging trends, or changes in consumer behavior. For instance, a Forbes article highlights how businesses can turn market disruptions into opportunities by adapting their strategies.
• Threats: Identify external threats, such as competitive pressure, market changes, or technological advancements. Understanding these threats is crucial for developing strategies to mitigate them.

Conducting a thorough introspection and analysis is fundamental for any startup contemplating a pivot. It allows you to make informed decisions based on empirical data and a comprehensive understanding of your business's strengths, weaknesses, opportunities, and threats. This strategic approach not only guides your pivot decision but also enhances the overall resilience and adaptability of your startup.

2. Defining the Pivot

Once you have a clear understanding of your startup's current situation through introspection and analysis, the next step is to define the pivot. This stage is about exploring various pivot options and validating them to ensure they address market needs effectively.

Identify Pivot Options

• Pivoting Your Product: This could mean altering the features, functionality, or even the entire concept of your product. For instance, a tech startup might shift from a software product to a platform-based service model.
• Target Market Pivot: Sometimes, the product is fine, but the target market needs to change. This pivot involves redefining your audience, perhaps focusing on a different demographic or geographic region.
• Pricing Strategy Pivot: Adjusting your pricing model can make your product more appealing. This could be moving from a one-time purchase to a subscription model or introducing tiered pricing.
• Business Model Pivot: This involves changing the fundamental way in which your business operates. For example, a company might switch from a direct-to-consumer model to a B2B model.
• Addressing Market Needs: Ensure that your pivot addresses a clear pain point or unmet need in the market and align your pivot strategy with those market needs.

Validate Your Ideas

• Conduct Surveys: Surveys can be a quick way to gauge customer interest in your new direction. Tools like SurveyMonkey or Google Forms can facilitate this process.
• Interviews: One-on-one interviews provide in-depth insights. These conversations can uncover nuanced opinions and feedback about your pivot idea.
• A/B Testing: For product or feature pivots, A/B testing can be invaluable. This involves presenting two versions of your product to the audience and measuring which one performs better.
• Pilot Programs: Launching a pilot or beta version of your pivot can provide real-world feedback before a full-scale rollout.
• Gathering Feedback: The feedback from these validation methods should guide your decision-making process.

Related source: Business Startup Advice: 15 Helpful Tips for Startup Growth

3. Building the Pivot Plan

After defining the pivot, the next crucial step is to build a structured plan to implement it. This involves setting clear goals, establishing a realistic timeline and budget, and effectively communicating the pivot to all stakeholders.

Set SMART Goals

• Specific: Clearly define what you aim to achieve with your pivot. For example, if you're pivoting to a new customer segment, specify who this new target audience is.
• Measurable: Establish criteria for measuring progress towards your goals. This could include metrics like customer acquisition rates, revenue targets, or market share.
• Achievable: Set realistic and attainable goals, considering your startup's resources and capabilities.
• Relevant: Ensure that your goals are aligned with your overall business objectives and market needs.
• Time-bound: Assign a clear timeline to your goals. This helps maintain momentum and allows for timely progress tracking.

Related resource: 6 Metrics Every Startup Founder Should Track

Develop a Timeline and Budget

• Creating a Realistic Timeline: According to Project Management Institute, effective timeline planning is critical in project management. Break down the pivot process into manageable tasks and assign deadlines to each. This helps in tracking progress and ensures that the pivot stays on schedule.
• Allocating Resources and Budget: Determine the resources and budget required for each stage of the pivot. This includes financial resources, human capital, and any other necessary assets. A well-planned budget is vital for allocating resources efficiently and avoiding financial overstretch.
• Prioritizing Tasks: Identify which tasks are critical and need immediate attention and which can be scheduled later. This prioritization ensures that resources are allocated effectively to areas with the most impact.

Communicate the Pivot

• Clear Communication with Team and Stakeholders: Transparency is key when communicating the pivot. Explain the rationale behind the pivot, the expected outcomes, and how it will impact various aspects of the business.
• Engaging with Investors and Customers: Keep your investors informed about the pivot and how it aligns with the long-term goals of the startup. For customers, emphasize how the pivot will benefit them or improve their experience with your product or service.
• Open Communication Channels: Establish open lines of communication for feedback and questions. This can include team meetings, investor updates , and customer newsletters. Effective communication in change management builds trust and fosters a collaborative environment.

4. Execution and Adaption

The execution and adaptation phase is where your pivot plan comes to life. It's crucial to approach this phase with agility and a focus on continual learning and adjustment. Here's how to navigate it effectively:

Be Agile and Iterative

• Adapting to Feedback and Market Conditions: The ability to quickly adapt your plan based on new information is vital. Agility in business allows companies to respond rapidly to changes in the internal and external environment without losing momentum.
• Embracing an Iterative Approach: Implement your pivot in stages, and be prepared to make changes as you gather more information. This iterative process is similar to the agile methodology used in software development, which encourages adaptive planning and continuous improvement.
• Willingness to Adjust: Don't hesitate to revisit and revise your plan if necessary. According to Forbes , successful pivots often involve a series of adjustments rather than a single, monumental shift. This approach allows you to refine your strategy based on real-world feedback and performance.

Measure and Track Progress

• Monitoring Key Performance Indicators (KPIs): Regularly track KPIs that are aligned with the goals of your pivot. This could include metrics such as customer acquisition cost, customer lifetime value, revenue growth, or market penetration.
• Analyzing Data: Use data analytics tools to delve into the performance data. This analysis will give you insights into what aspects of your pivot are working and which areas need improvement.
• Making Adjustments for Optimization: Based on your KPI analysis, make informed adjustments to optimize your results. This could involve tweaking your marketing strategy, refining your product offering, or reallocating resources to more effective channels.

5. Building Resilience

Embarking on a pivot is a journey filled with challenges and opportunities. Building resilience throughout this process is essential for both personal growth and the success of your startup. Here’s how to cultivate resilience during a pivot:

Embrace the Challenge

• Preparedness for Setbacks and Roadblocks: Understand that pivots are rarely smooth and straightforward. They should be viewed as opportunities for learning and growth rather than just obstacles.
• Staying Positive: Maintaining a positive outlook is crucial. This mindset will help you navigate through tough times more effectively. A study in the Journal of Positive Psychology shows that positivity enhances resilience, enabling individuals to better cope with challenges and stress.
• Learning from Mistakes: Every setback or mistake is a learning opportunity. Reflect on what went wrong, what you could have done differently, and how you can avoid similar mistakes in the future.
• Perseverance: Persistence is critical during a pivot. The ability to keep pushing forward, even when faced with difficulties, is what often separates successful pivots from unsuccessful ones.

Surround Yourself with Support

• Building a Support Network: Cultivate a network of mentors, advisors, and fellow entrepreneurs. These individuals can provide invaluable guidance, support, and insight based on their experiences.
• Leveraging Mentorship and Advice: Engage with mentors who can offer advice and perspectives that may not be apparent from within your organization. Their objective viewpoint can be crucial in decision-making and strategy refinement.
• Connecting with Fellow Entrepreneurs: Fellow entrepreneurs can provide empathy and understanding, having gone through or currently facing similar challenges. Platforms like LinkedIn , entrepreneurial forums, or local business groups can be great places to connect with like-minded individuals.
• Seeking Encouragement: Encouragement from your network can be a powerful motivator during challenging times. Sometimes, a simple word of encouragement can provide the boost needed to overcome a tough phase.

Types of Startup Pivots

Every startup's pivot journey is unique, often involving different types of changes.

Customer Segment Pivot

A Customer Segment pivot is when a startup shifts focus to a new group of customers who may have a greater need or appreciation for its product. This pivot often occurs after identifying a more responsive or profitable market segment.

Key steps for a successful Customer Segment pivot include:

• Listen to Your Users: Understanding user feedback is vital. If users are consistently pointing out certain features or suggesting improvements, it could indicate a new direction for the product.
• Reanalyse Your Competition: Analyze how competitors address the needs of different customer segments. This can offer insights into gaps in the market and potential opportunities.
• Speak Your Users’ Language: Communication is key. Ensure that your messaging resonates with the new target audience and clearly conveys the value proposition.
• Pivot Sooner Rather Than Later: If a pivot is necessary, it's usually better to act swiftly to avoid wasting resources and to stay ahead of market changes.
• Ensure Team Alignment: Make sure your team understands and supports the pivot. This might involve changes in roles or the introduction of new skill sets.

This pivot requires understanding diverse market segments, adapting the product or service, and effective execution.

Product Pivot

A Product Pivot in a startup involves making significant changes to the product itself, which can include altering features, the operating platform, or even the core problem the product aims to solve.

Several successful startups have executed product pivots effectively:

• Twitter // X : Started as Odeo, a podcasting platform, Twitter pivoted to become a microblogging service. This pivot was initiated when Apple dominated the podcasting industry with iTunes Podcasts, leading Twitter to reinvent itself.
• Instagram : Initially a location-based check-in app named Burbn, Instagram pivoted to focus solely on photo sharing after recognizing that this feature was more popular among users.
• Wistia : Began as a video-sharing community, Wistia pivoted to become a video marketing platform for businesses, responding to the interest shown by businesses in using the platform for hosting and analyzing marketing videos.
• PayPal : Initially a digital wallet for Palm Pilots, PayPal pivoted to an online payment platform, adapting to the growing demand for online payment solutions.
• Pinterest : Started as Tote, a social shopping app, Pinterest pivoted to become a visual discovery platform when they realized users were more interested in organizing and sharing images.
• Groupon : Originally a platform for mobilizing collective action for social causes, Groupon pivoted to a daily deals marketplace, capitalizing on the potential of offering discounted deals to consumers.

Value Proposition Pivot

In a Value Proposition Pivot, a startup fundamentally changes the core value or benefit its product offers to customers. This pivot might involve redefining what the company stands for or altering its key selling points. Essentially, it's about shifting the product's unique value to better align with market demands or to differentiate from competitors.

For instance, a tech startup might pivot from offering just a productivity tool to positioning it as a comprehensive solution for remote work management, changing its core value from mere functionality to an all-in-one platform addressing the emerging needs of remote teams. This type of pivot requires a deep understanding of customer needs, market trends, and a reevaluation of the company's strengths and capabilities.

The effectiveness of a Value Proposition Pivot depends on the startup's ability to clearly communicate the new value to its target audience and ensuring that this shift resonates with customer needs and preferences. It's not just about changing the product; it's about changing the perception and experience of the product in the eyes of the customer.

Business Model Pivot

In a business model pivot, startups undergo a major transformation in how they generate revenue. This could mean changing from a subscription to a freemium model, or altering the overall revenue strategy. Such pivots are not minor adjustments but represent significant shifts in the company's financial and operational approach.

For example, a company might pivot from direct sales to a freemium model to broaden its user base and create diverse revenue streams. Alternatively, pivoting from a high-touch service model to an automated approach could reduce costs and facilitate scaling.

The success of a business model pivot hinges on aligning the new model with the company's vision and market demands. It often requires market research, re-evaluation of customer needs, and possibly rebranding. Effective pivots leverage the company's strengths while adapting to market changes and customer preferences.

For founders, a business model pivot necessitates a thorough assessment of its impact on all business facets, from product development to customer relations. This strategic shift can lead to new growth and sustainability in a dynamic business environment​​​​.

Technology Pivot

In a technology pivot, a startup fundamentally changes the technology or platform underlying its product or service. This pivot can be driven by various factors, such as advancements in technology, the need to improve scalability or performance, or the discovery that users prefer a particular feature of the product.

For founders considering a technology pivot, it's crucial to assess not only the technological feasibility of the pivot but also how it aligns with your business goals and customer needs. This strategic shift, although challenging, can open up new opportunities and pathways for growth and sustainability in a fast-evolving technological landscape​​​​.

Real-Life Startup Pivot Examples With Glowing Success

Successful pivots by well-known companies can provide inspiration and insight into the process.

• Original idea: A DVD-by-mail rental service.
• Pivot: Anticipated the shift to streaming media and introduced a streaming service, eventually phasing out DVDs.
• Result: Became a global streaming giant with over 220 million subscribers and a pioneer in producing original content.
• Original idea: A mobile payments platform called Confinity, enabling payments between Palm Pilots.
• Pivot: Expanded to online payments and integrated with eBay, becoming a leading online payment service.
• Result: Revolutionized e-commerce transactions and expanded into a global financial services company.
• Original idea: A manufacturer of playing cards.
• Pivot: Expanded into electronic toys and video games, becoming a pioneer in the gaming industry.
• Result: Evolved into a renowned video game company with iconic franchises like Mario and Zelda.

Looking To Pivot Your Startup? Connect With Visible Today

Pivoting a startup is a dynamic and challenging journey, but with the right strategies, it can lead to remarkable success and resilience. If you're looking to pivot your startup, remember the importance of data-driven decision-making, clear communication, and adaptability. For further support and guidance, consider partnering with Visible.

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Related resource: The Ultimate Guide to Startup Funding Stages

Pivot Definition

Pivot, in the context of business and entrepreneurship, refers to the strategic decision to change the direction or focus of a company in response to market conditions, customer feedback, or other external factors. It involves making significant adjustments to the business model, product offering, target market, or overall strategy to better align with the evolving needs and demands of the market.

What is Pivoting?

Pivoting is a term commonly used in the startup world. Still, it can be applied to any business that needs to adapt and stay relevant in a rapidly changing marketplace. It is the process of recognizing that the current approach is not yielding the desired results and deliberately shifting in a new direction. Pivoting requires letting go of old assumptions, embracing new opportunities, and taking calculated risks to achieve long-term success.

When to Pivot

Knowing when to pivot is crucial for the survival and growth of a business. Several indicators may suggest the need for a pivot:

• Market Validation: If the product or service is not gaining traction in the market or failing to meet customer needs, it may be time to reassess the business model and make necessary adjustments.
• Changing Market Conditions: External factors such as technological advancements, shifts in consumer behavior, or new competitors entering the market can create the need for a pivot to stay competitive.
• Customer Feedback: Listening to customer feedback and understanding their pain points can provide valuable insights into areas where the business may need to pivot to serve their needs better.
• Financial Constraints: If the business is struggling financially or not generating sufficient revenue, a pivot may be necessary to explore new revenue streams or cost-saving measures.

How to Pivot Successfully

The process of pivoting involves careful analysis, planning , and execution. Here are the key steps to successfully pivot a business:

• Evaluate and Reflect: Conduct a thorough assessment of the current business model, market conditions, customer feedback, and financial performance. Identify areas that need improvement or change.
• Define the New Direction: Based on the evaluation, determine the new direction or focus for the business. This may involve refining the target market, developing new products or services, or adopting a different business model.
• Develop a Strategy: Create a detailed plan outlining the steps, resources, and timeline required to execute the pivot successfully. Consider the potential risks and challenges and develop contingency plans.
• Communicate and Engage: Effective communication is crucial during a pivot. Clearly articulate the reasons for the pivot to employees, customers, investors, and other stakeholders. Engage them in the process and address any concerns or questions they may have.
• Execute and Monitor: Implement the pivot plan and closely monitor the results. Continuously gather feedback, measure key performance indicators, and make necessary adjustments along the way.

Pivot Examples

Business pivots, a critical aspect of adapting to changing market landscapes, encompass various strategic shifts companies undertake across multiple industries. This section delves into a collection of industry-specific examples , expert insights, and significant case studies that illustrate the multifaceted nature of business pivots. These examples showcase the practical application of pivoting strategies and provide a deeper understanding of how businesses navigate challenges and seize new opportunities. From tech giants to retail leaders, these instances reveal the dynamic and innovative spirit that characterizes successful business transformations.

• Airbnb’s Initial Focus on Conference Attendees: Originally aimed at providing accommodation for conference attendees, Airbnb pivoted to cater to travelers seeking authentic local experiences, leading to its current valuation of approximately $38 billion​​.
• Mattel’s Pivot to Reflect Current Heroes: In response to changing social sentiments, Mattel introduced a new line of Fisher-Price action figures featuring delivery drivers, healthcare professionals, and grocery store workers, showcasing an understanding of contemporary heroes​​.
• Patagonia’s Expansion into the Food Market: Patagonia expanded its Patagonia Provisions line to include a broader range of long-shelf-life foods, aligning with global food supply chain sustainability​​.
• Shopify’s Shift from Snowboard Retail to E-commerce Platform: Originally an online snowboard store, Shopify pivoted to selling its e-commerce platform to other businesses, transforming into a thriving tech giant​​.
• Spotify’s Integration of Podcasts: To adapt to changing market dynamics, Spotify incorporated podcasts into its platform, significantly impacting its role as a content provider and tastemaker​​.

Expert Opinions and Case Studies

• T3 Expo’s Transformation During COVID-19: The trade show company, T3 Expo, leveraged its planning skills to transform convention facilities into COVID-19 hospitals, exemplifying a pivot to meet urgent societal needs​​.
• TOV Furniture’s E-commerce Shift: Facing pandemic-related challenges, TOV Furniture pivoted to e-commerce, capitalizing on the increased demand for home furniture, resulting in a 200% growth​​.

Current Market Trends and Analysis

• YouTube’s Evolution from a Video-Dating Site: Initially a video-dating platform, YouTube shifted focus to user-generated content, leading to its acquisition by Google and establishment as the leading video-sharing site​​.

Academic and Research-Based Insights

• Lean Startup Methodology in Pivoting: The concept of a pivot in entrepreneurship, popularized by Eric Ries and Steve Blank in the Lean Startup Movement, involves using the scientific method to test and adapt business hypotheses​​.
• Wharton’s Study on Entrepreneurial Pivots: Jacqueline Kirtley from Wharton School conducted a study on seven early-stage firms in the energy and cleantech sector, examining the nature and execution of strategic pivots in the startup world​​​​​​.

Long-Term Impact Analysis

• Slack’s Shift from Gaming to Communication Platform: Slack’s pivot from a multiplayer online game to a communication tool exemplifies a substantial strategic change, maintaining a core element while altering the business direction​​.

In today’s fast-paced and ever-changing business landscape, pivoting is essential for long-term success. By recognizing when to pivot, carefully planning the new direction , and executing the pivot effectively, businesses can adapt to market conditions, meet customer needs, and stay ahead of the competition. Pivoting is not a sign of failure but rather a strategic move to position the business for growth and sustainability.

Related Terms

• SMART Goal Setting
• Moscow Prioritization
• Stakeholders Analysis
• Product Design
• Minimum Viable Product (MVP)
• Customer Acquisition Cost (CAC)

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Netflix – Constantly Pivoting its Business Model to Success

A couple of days ago, I was wandering down the rabbit hole of the internet (as often happens). I found myself at a website that listed every movie or show that is a part of Netflix’s September 2020 slate of releases. I counted 111 titles on that list! And a whopping 62 out of those 111 titles are Netflix original movies or series. That’s 2 original titles per day!

For millions like me across the globe, Netflix is the de-facto king of online movie and tv entertainment. Netflix’s services alone constituted around 15% of global application traffic share as of 2018. How did a company that started by posting DVDs by mail manage this? By pivoting, successfully, twice.

The term ‘pivot’ was first popularized by Eric Ries in his book The Lean Startup . He advises startups to be dynamic and react quickly in the marketplace, using course corrections to emerge as a success. According to him, a pivot is a change in strategy without a change in vision. It means that the company can change how it achieves the goal, but the goal does not change.

The business landscape of the world is littered with companies that remained stuck defending old business models. Blackberry, Nokia, Sun Microsystems, and of course Blockbuster. In an era when constant innovation is required just to stay afloat, Netflix has redefined agility by pivoting not once, but twice! Netflix’s strategy for success is intricately tied to its story. So, let’s take a look.

Netflix Business Model Pivot 1 – The Online Revolution

Netflix was founded by Marc Randolph and Reed Hastings in August 1997 as a movie rental service. Initially, users ordered a movie through the Netflix website and Netflix would post them to their door. After the renter was done watching the movie, they would simply mail it back.

Netflix’s business model was in direct competition with brick-and-mortar movie rental stores . Netflix started gaining traction, gaining $1B in revenue by 2008, taking the same amount directly from Blockbuster’s pocket. In fact, at one point, Netflix became the largest client of the US Postal Service! ( Fun fact : there is still an option of requesting a DVD from Netflix but only in the US)

But Netflix’s vision was never limited to the DVD-rental business model. DVDs were just a temporary solution while the technology for digital streaming matured. This is why the company was called Netflix (net = internet, flix = movies) . They knew where they were eventually going. In 2007, Netflix started its streaming service after YouTube proved that streaming video was technologically ready. This was the first pivot.

Netflix completely committed itself to the online streaming business model. DVD-rental has become its side business. Legend has it, that the DVD executives were even kicked out of the management meetings. Reason? They were not adding value to the future vision and direction of the company.

Read: Why Is The World Moving Towards A Subscription Economy?

Netflix business model pivot 2 – king of content.

Netflix wasn’t the only company that had noticed the technological revolution that made streaming possible. They were acutely aware of the fact that much larger (read: wealthier) media houses would start gearing up with their own streaming services. Netflix, as a distribution service, was in danger of being cut out of the loop.

So, Netflix moved ahead of this risk by creating and launching their own content, first with Lilyhammer in 2011 and then with the hugely successful House of Cards in 2013. This was the second pivot.

By focusing on offering customers better content, using analytics to drive acquisition, and giving creatives more freedom, Netflix has become a powerhouse content creator that is spending $17.3B for content in 2020.

Read: Movie-making is more about strategy than creativity. How?

That Netflix is serious about its content strategy was made crystal clear by their decision to name Ted Sarandos as the co-CEO in 2020, along with Reed Hastings. Sarandos is the man behind Netflix’s content efforts and wins, and this appointment is a sign that Netflix is doubling down on its content creation bid.

Netflix Changing Business Model Without Changing Vision

Netflix’s vision is to become the best global entertainment distribution service. And that vision has remained consistent with all the changes Netflix has made over the years. Be it through mailing DVDs, or streaming digitally, or producing their own content, Netflix has strived to provide the best in entertainment to its users at every step.

Reed Hastings has often attributed the company’s success to its culture, which has helped the company overcome lows, push the envelope, and allow for innovation. This in turn has led to quick pivots, rapid scaling, and unprecedented success.

Reed Hastings discusses the origin and impact of Netflix’s unorthodox culture in his new book No Rules Rules: Netflix and the Culture of Reinvention .

Pivoting is not an easy prospect, even if all signs point to it being the right decision. It is more a mindset, to be willing to make hard changes to get ahead in the business. And Netflix has time and again shown that it is willing to make those difficult decisions and run with them.

Don’t be afraid to change the model. – Reed Hastings, co-CEO, Netflix

Interested in reading our Advanced Strategy Stories . Check out our collection.

Also check out our most loved stories below

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How Bata became India’s household name despite being a classy international brand?

Bata is not an Indian brand. It is as international as it can be. But what strategies made it India’s highest selling footwear brand?

Nike doesn’t sell shoes. It sells an idea!!

Nike has built one of the most powerful brands in the world through its benefit based marketing strategy. What is this strategy and how Nike has used it?

Domino’s is not a pizza delivery company. What is it then?

How one step towards digital transformation completely changed the brand perception of Domino’s from a pizza delivery company to a technology company?

What advertising strategy made TITAN an iconic watch brand?

What are the various advertising strategies that make Titan a consumer’s choice? How Titan decided to choose Mozart’s symphony as its tune for commercials?

WhatsApp “Photo Status” was a strategic move. How?

Whatsapp launched photo status in 2017. It was hated by many. But why it was a good move that improved the way you use application today?

Aditya is a project manager with experience in technology and consulting. He received his MBA from HEC Paris with a focus on strategy. He reads, travels, writes, and works, in that order. His career aspirations include becoming a Chief Meme Officer and gathering enough free time to finally write that book he’s always thinking about!

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A CEO’s Guide to Navigating a Startup Pivot

With 25 years of CEO experience I’ve navigated the complexities of organizational growth from every vantage point, including startup pivots. In this post we’ll talk about startup pivots.

A pivot is more than just performing strategic adjustments. Pivots are life changing, they will alter the entire direction of your company.

A Startup CEO leading a pivot requires courage and good judgment. It’s up to you to align the vision, communicate clearly, and make the tough decisions.

This post will walk you through how to prepare for this shift: identifying the need for change, evaluating your options and executing them with precision.

We’ll also look at how to measure the success of your pivot through Key Performance Indicators (KPIs) and customer feedback and what to watch out for. We’ll also show you real world examples of pivoting.

Before we get into how to do a pivot let’s look at some examples.

Case Studies: Learning from Successes and Failures

Real world examples are powerful learning tools. In this section, we’ll look at a few case studies of startups that pivoted successfully and those that didn’t. These startup stories will give you the dos and don’ts of pivoting, timing, market understanding, and customer alignment.

Although the company is doing great now Twitter was off to a rough start. Twitter was originally a platform for finding podcasts. When the business model didn’t work the company pivoted and started focusing on microblogging. This pivot was the secret to exponential growth.

Understanding user behavior was the trigger for Slack’s pivot. Slack started as an internal tool for game developers at Tiny Spec. The product evolved when company executives realized collaboration went beyond game development. Now Slack is one of the leading communication platforms across multiple industries.

Flickr is a great example of adaptability. The platform started as part of Ludicorp’s online game Neverending and was used to share photos among players. When company leaders saw a new photo-sharing trend they were first to pivot and offer image hosting.

Groupon started as The Point, a website for organizing campaigns around collective actions. When the executives saw group buying power was more lucrative they pivoted from the original mission.

Instagram’s success is built on member loyalty because they listen to their users. Instagram started as Burbn, an app with too many features that obscured the core value proposition – simple photography to simplify sharing photos on social media. When they saw simplified photo handling was improving social media engagement they simplified the app and now it’s one of the most used photo sharing platforms in the world.

Each of these examples is a startup that was agile and resilient enough to pivot. In each case leadership was able to look ahead and anticipate customer and market needs.

Delving into the Essence of Startup Pivots

A pivot is more than a tweak. It’s a full on strategic overhaul of one or more parts of your business model. This must be data and analysis driven and point to market alignment and more success.

The Imperative of Pivots in Business Evolution

A pivot is required when you see signs your startup is off track. These signs could be market shifts, new regulations, changing consumer demand or customer feedback. New technology might make your existing product or service obsolete and require a pivot. A pivot might also be needed to deal with internal dynamics, scalability issues, cost structure and team dynamics.

A pivot’s success depends on recognizing these signs quickly and acting decisively. This is not failure but evolution and growth. It requires deep understanding of your current situation and the market opportunities.

The CEO’s Role

During a pivot the CEO must be: the visionary who sets the direction, the chief communicator who keeps it clear and the resolute leader who makes the tough decisions. The CEO must keep the whole company aligned with the vision since everyone is part of the transformation.

Effective communication with all stakeholders is key. This includes employees, investors and customers. Communication must be clear, consistent and reflect the changing dynamics of your business.

Main Takeaway

Startup pivots are not just business tweaks. They are changes in strategy based on hard data that point to a new path to success. The CEO must be the visionary and chief communicator guiding the team through the short term changes while laying the foundation for the long term.

Preparing for a Startup Pivot: A CEO’s Guide

Preparing for a pivot requires awareness of the signs that indicate the need for change and a thorough evaluation of the options before committing to a plan. A pivot strategy should deliver the best outcomes in the post pivot phase, operational changes, preserve the company culture and manage stakeholder expectations.

A pivot is top down but should be bottom up too to ensure smooth transitions, minimal disruption and maximum success.

Having success metrics in place during the planning phase provides a baseline to measure the pivot’s success.

A CEO guiding a startup through a pivot must recognize the need for change and orchestrate the change. A CEO has several roles:

Visionary Leadership and Strategic Redirection

A CEO must recognize the need for a pivot and redefine the company direction. This requires a deep understanding of market trends, customer needs, and internal capabilities. The leader must set a new direction that applies these insights so the company is ready to take advantage of the new opportunities.

Effective Communication and Stakeholder Management

Clear and consistent communication is key during change. As CEO you must communicate the pivot to all stakeholders, employees, investors, customers, and partners. Communication must be transparent and explain the why and what of the pivot. You must keep all parties on board.

Navigating Operational and Cultural Shifts

A pivot often requires big operational changes – changing the product, adopting new tech or reorganizing the business. A CEO needs to make sure these changes happen smoothly and with minimal disruption. Equally important is preserving the company’s core values and culture during this transition.

Measuring Success and Adjusting Course

After the pivot it’s crucial to measure the impact of the changes by tracking KPIs, gathering customer feedback and looking at financials. Based on this data a CEO may need to make further adjustments to get the pivot to work.

Embracing Continuous Learning and Adaptability

A pivot requires an agile mindset. As a CEO you need to be open to new ideas and change your approach based on new data and feedback.

The CEO needs to steer the company through the pivot with a clear vision and open communication. This means setting direction, inspiring stakeholders and communicating progress. The CEO needs to initiate operational and cultural changes and KPIs based on data and stakeholder feedback. any operational and cultural changes and implement KPIs based on data and stakeholder feedback.

The Evolving Landscape of Startup Pivots

Being able to pivot well is a sign of a company’s agility and responsiveness to changing market needs. This section looks at the different types of pivots and their impact on the startup journey.

Recognizing the Catalysts for Change

The need for a pivot often comes from critical moments – market change, technological advancements, or internal organizational challenges. Being able to spot these triggers is a skill of proactive leaders. It means not just knowing your business but having a deep understanding of external factors – emerging trends, competitor moves, and customer behavior.

Strategic Pivots: Beyond the Surface Adjustments

When we talk of pivots in the startup world we mean big changes – changing the business model, redefining the product or service or a complete overhaul for a new market. Such strategic pivots require a deep understanding of what the startup is about and where it’s going and need courage and strategic thinking from the leadership.

Incorporating Feedback Loops and Data-Driven Decisions

A key part of managing a pivot is to have robust feedback loops and data-driven decisions. This means setting up channels to gather continuous feedback from customers and employees and using that feedback along with market data to guide the pivot. Being able to iterate in real-time is key to tuning the strategy and making it relevant and effective.

The CEO needs to spot the need for a strategic pivot – watching market changes and stakeholder feedback. Changes must be data-driven not just a gut feel and every step must be scrutinized and adjusted to pivot to success.

Adapting to Market Dynamics: The Agile CEO’s Playbook

In a world of constant change adaptability is not a nice to have, it’s a must have. This section looks at how a CEO can lead their company through the uncertainty of market change with agility and foresight:

Understand Market Dynamics and Their Implications

To navigate market change you need to know the market dynamics. These are – recognizing emerging trends, identifying changes in customer behavior, watching competitor moves and new regulations. A CEO needs to have their finger on the pulse of the market and use that knowledge to anticipate and adapt.

Balance Risk and Innovation in Decision-Making

One of the challenges of a pivot is balancing innovation with risk. Decisive leadership means taking calculated risks. It’s about knowing when to push the boundaries and when to play it safe. Maintaining this balance is key if the startup is to stay competitive and avoid the pitfalls.

Leveraging Technology and Data for Strategic Decisions

Using technology and analytics is critical in making informed decisions. A forward thinking CEO uses data to understand the current market and to forecast future trends and customer needs. A data driven approach means more strategic and evidence based decision making which is crucial in navigating the market fluctuations.

Cultivating a Culture of Agility and Resilience

The CEO must also create a company culture that is change-friendly and resilient. Such a culture is one of flexibility, open communication, and pivoting when needed. It’s about building a team that can adapt to change but also drives change.

Companies pivot with purpose. It’s the CEO’s job to know the market dynamics and the implications of change, balance the risks and use research and data to guide decisions and adjust the culture.

Harnessing Internal Strengths for an Effective Pivot Strategy

A successful pivot is not just about external market alignment but also about leveraging the internal strengths of the startup. This section looks at how a CEO can identify and use those strengths to pivot.

Identifying and Capitalizing on Core Competencies

Before you can use internal strengths you need to identify them. What are the unique skills, technologies or processes that give the company an edge? A smart CEO knows what those are and finds ways to repurpose or enhance them as part of the new strategy.

Aligning Team Dynamics with New Goals

As the startup changes direction it’s critical that the team is aligned with the new goals. This means clearly communicating the pivot’s objectives, redefining roles and responsibilities, as well as providing the necessary training and support. A CEO must make sure the team is not only ready for the change but also motivated and engaged in the process.

Streamlining Operations for Flexibility and Efficiency

Using internal strengths means simplifying operations. This might mean reorganizing the company, optimising processes or introducing new technology. The goal is to create a more flexible and efficient operation that can adapt quickly to new strategies and market demands.

Building a Resilient Organizational Culture

Last but not least creating an agile culture is key to a pivot. An agile culture is one of adaptability, innovation, and change friendly. As a CEO it means creating an environment where new ideas are encouraged, failures are seen as learning opportunities and agility is in the company’s DNA.

A pivot doesn’t mean starting over. The CEO must assess what’s already working and align teams and resources to the new goals. The CEO must also simplify and nurture a culture that welcomes new ideas.

Navigating Challenges and Overcoming Obstacles in Pivoting

Pivoting is essential for long term success but it’s not without it’s challenges. Here are a few of the common challenges startups face when pivoting and how a CEO can navigate them:

Anticipating and Mitigating Risks

One of the first things in any pivot is to anticipate the risks, including internal and market shifts. The CEO’s job is to mitigate those risks and not put the startup in jeopardy.

Maintaining Stakeholder Confidence

During times of significant change, maintaining stakeholder confidence – investors, customers, employees, partners – is key. This means being open about why you’re pivoting and regular updates. A CEO must be optimistic but realistic, get stakeholder buy in throughout the transition.

Ensuring Continuous Customer Alignment

Keeping the product or service aligned to customer needs is critical during a pivot. Alignment requires market research, customer feedback loops and agile product development. The CEO keeps the pivot customer centric, addressing real market needs and customer expectations.

Managing Internal Transition Smoothly

Managing the internal transition during a pivot can be tough. It requires resource management, team restructuring and sometimes a change in company culture. The CEO must lead this transition, so the team understands the vision, feels supported and can handle their new roles and responsibilities.

Every pivot has it’s challenges. To minimize those challenges the CEO should anticipate the risks, maintain stakeholder buy in and keep customers informed of the new direction. It’s the CEO’s job to manage the internal transition.

Leveraging Pivots for Long-term Success and Growth

The goal of any pivot is not just to get through the immediate challenges but to set up for long term success. The CEO must know how to pivot to get the startup into a sustainable future:

Visionary Planning for Future Growth

Any pivot should be part of a bigger long term strategy for the company. A CEO must see how the pivot will contribute to the company’s growth. This means strategic planning, market vision and understanding how the current changes fit with the future goals.

Building Scalability and Sustainability Post-Pivot

After the pivot the focus should be on scalability and sustainability. This means applying business models and operational processes that can scale and adapt. A CEO must ensure the new direction meets current market needs but is also scalable and sustainable in the long term.

Cultivating Innovation and Continuous Improvement

A good pivot often creates a culture of innovation and continuous improvement. The CEO should keep that momentum going, encouraging innovation and regular review of the business strategy. This culture of continuous improvement keeps the startup ahead of the market and customer needs.

Measuring Success and Adapting Strategies Accordingly

Finally measure success against KPIs and milestones. It’s the CEO’s job to review those regularly and adapt as needed. This ongoing review keeps the startup agile and responsive to change.

Pivoting is only the first step. For long-term success, the CEO needs to plan for a successful post- pivot, including scalability, sustainability, and ongoing improvement. Success must be measured against the right KPIs and milestones.

Evolutionary Leadership in Startup Pivots

Pivots are part of a startup’s evolutionary process. Pivots require visionary leadership, strategic agility, and continuous learning and adaptation. For CEOs, it’s not just about executing the pivot but makinge it part of the company’s ongoing story.

It’s about navigating the current challenges while setting up for future success. As one pivot ends another begins. A CEO who looks forward always looks ahead to the next set of challenges and opportunities that will shape the company’s future.

My name is Glenn Gow, CEO Coach . I love coaching CEOs and want to help make you an even better CEO. Let’s decide if we are a fit for each other. Schedule a time to talk with me at calendly.com/glenngow. I look forward to speaking with you soon.

TESTIMONIALS

Take Their Word For It

I've been working with Glenn Gow for about two years now, and I can say without a doubt that Glenn has made a massive impact to who I am today as a CEO. Everything that a CEO could possibly want comes from Glenn.

CEO of QuotaPath

I’m learning a lot from Glenn. He’s helped me determine what’s really important so I can make better, more timely decisions to steer my company to where I want it to go.

CEO of Radical Imaging LLC

What Glenn’s Clients are Saying…

Albert navarro, ceo , metriclock, srinivas akella, former ceo , wootcloud.

Glenn’s coaching has made a huge difference in how quickly and confidently we’ve been able to grow.

CEO , Workreels

Jeff strnad, ceo , door usa, darren marble, co-ceo , crush capital, liam nguyen, ceo , pixel canvas.

I feel I have superpower eyesight with you in my corner.

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Ceo , treedom, allan njoroge, ceo , actriv healthcare, cynthia tusan, ceo , idea lab, former ceo , leadcrunch, aaron schoenberger, ceo , soteria intelligence, ceo , acuteiq, director , public company board, ceo , loginid, sameer ahuja, president , gamechanger, ceo , quotapath.

SUCCESS STORIES

Janice Raises Over $100M for Her Company

As one of the founders, Janice had created the perfect solution in an exploding market. As her CEO Coach, we worked very hard to create a scalable business model that significantly accelerated revenue growth. This model included geographic expansion, the addition of new product offerings, and stickiness to create repeat business.

This triple revenue-acceleration model not only worked but it attracted the interest of growth investors.

But a growth model wasn't enough. We needed to help Janice become a better CEO. Specifically, we worked on how to manage her board, so their faith in her as the CEO grew as time went on.

For some CEOs, the board can be intimidating. At first, it was for Janice as well. We worked on how to manage the board and get the most out of the board. Ultimately, we turned the board into a strong set of advisors and advocates for Janice as the CEO.

The support and confidence of the existing board was a critical factor in enabling her to raise well over $100M in the next round, increasing the valuation by more than $600M.

Darren Raises His First $3 Million

My CEO client (Darren) was starting a company in a new category. He was focused on raising capital for his business and wanted help crafting his story. Darren is a brilliant CEO, yet he realized he could produce a better story with help from someone who has created successful fundraising stories many times.

When we started working together, his story was overly complex, difficult for investors to understand, and not as strong as it could have been. Together we built a story about the tremendous value the company was creating. We used historical precedent to bolster the vision and mission. We gave investors confidence in the founders. We proved that the company could scale.

Investors are pattern-matchers. They look for the patterns that tell them this opportunity is like other opportunities they’ve seen, giving them a strong belief in the potential ROI. Together, Darren and I constructed a winning story that helped key investors see the patterns of success.

According to Darren, “Glenn gave me the perspective and confidence I needed to succeed.” Darren raised $3 million for his startup company in his first round. Darren has continued to successfully raise money in later rounds as well.

Meilin Creates A Scaling Organization

Meilin was always asking, "How can I help my company grow faster?" She was successful by most measures but had higher growth ambitions.

As her CEO Coach, I helped focus her efforts and energies on an often-overlooked area for many CEOs. This area enables scaling and enables the CEO to manage their team more effectively -- values.

Most CEOs have corporate values but don't use them as the ultimate way to install a belief system - a way for every employee to focus on the most critical issues for the company.

Meilin and I worked on making the values core to the thinking and speaking of the management team. Once the management team adopted these values and started speaking about them in their regular communications, we knew that we were on our way to ensuring that every employee “lived” the values.

While values are not the only thing a company needs to grow fast, they are critical to its success. Meilin's company is now growing over 100%.

Sean Gets It All Done

As CEO, Sean had no work-life balance, and he was struggling with the overwhelming responsibilities of being a CEO. One of the biggest challenges of any CEO is to get everything done. The list of critical items seems to grow every day.

As his CEO coach (and as a former CEO), I recognized the stress he was under. That level of stress is no fun. To help Sean become a better CEO, I focused him on delegation, talent development, and balance.

First, we focused on developing Sean's delegation skills. Delegation is the "8th wonder of the world." When you make it work, your workload diminishes, and the company performs at a higher level. As Sean became better at delegating, he also began to see strengths and weaknesses in his leadership team from a different perspective.

The next step was to refresh his leadership team. We created a plan to either develop the ones that could step it up and perform better or find new leadership team members for those that couldn't help the company grow.

Finally, we worked on creating a way of living for Sean that provided him some balance. I tell my CEOs to "put their oxygen mask on first." If a CEO wants to perform at the highest level, they need to take care of themselves first.

Now that Sean has a much better leadership team, he has become a master delegator. By delegating many of the activities he had taken on before, he now has much more time to take care of himself.

Sean's company has now entered a new growth phase . More importantly, he is enjoying his work a lot more and his life a lot more.

Viraj Fires His “Best” Employee

As a CEO, Viraj was focused on employee retention. He recognized the value of keeping high-performing employees and the high cost of turnover.

One of Viraj's direct reports was one of his "best" employees. This person consistently out-performed against their targets. Within their function, they were a rock star.

However, this same person was toxic to the rest of the organization. They constantly argued with others, and they made most others feel bad about themselves. Viraj found he was spending a great deal of time managing around the toxicity created by this employee.

Viraj valued this person's contributions within their function, and he also really hated the idea of employee turnover. As a result, Viraj put up with this person and continued to work around the toxicity issue.

As Viraj's CEO Coach, I helped him understand that team alignment and team cohesion are critical factors to help the company grow. We agreed that preventing employee turnover is a good goal, but not at the expense of creating a well-functioning team.

Viraj wanted to become a better CEO, and he knew what he had to do. While it was difficult, he decided to fire the person he once thought was his "best" employee.

The first thing he heard from the rest of his direct reports was, "What took you so long?"

Olivia Finds Product-Market Fit

Olivia, my CEO client, is a product genius. She is highly creative, an excellent problem-solver, and knows how to get products out the door on time.

Olivia raised a great deal of money based on her product ideas and some early successes. The challenge was that her company wasn't growing fast enough. The pressure from the investors was building, and she was worried.

Raising a lot of money early is a blessing and a curse. The curse is that Olivia delivered her product too quickly. She delivered it, making too many assumptions about the market she was serving. When the product was released, it was a good fit but not a great fit.

Olivia was concerned about the time and dollars it would take to conduct research and test product-market fit in multiple market segments. We created a partnering strategy that enabled us to test multiple new market segments in a short time.

Olivia has found multiple market segments that are a fit for the product. Now that she has achieved product-market fit, the strategy is to "go big" on the go-to-market. And her company is taking off.

Wilson Turns the Board Around

Wilson was a first-time CEO. The company was doing well, but not quite as well as the board had hoped. Wilson found himself uncomfortable as a minority shareholder working with a board that could fire him if he didn't perform.

Wilson wanted to know how to manage a Board of Directors . The first step was to acknowledge that a board has different measures of success than the CEO. That means there will naturally be tension. The second step was to dig in to deeply understand what the key drivers are for each board member.

Based on this information, Wilson can now address his needs, the company's needs, and the board's needs. That was the first breakthrough.

Once he knew how to address the needs of the board, we turned to address his needs. As Wilson's CEO Coach, I helped him realize that the board is an incredible asset to leverage.

Wilson began to build relationships with the board members individually to understand better how they could be of service to him and the company.

When Wilson works with the board, he is fully aware of their needs and addresses them appropriately. More importantly, he now tells the board what he is doing and relies on their insight and experience for feedback on how to help the company perform at a higher level.

Wilson is no longer concerned about the board and now gets more out of them than ever before.

Darius Solved His Crisis

I got the call at 10 PM on a Thursday. Darius, a CEO client, reached out to me just as I was about to end the day. "Glenn, my Chief Revenue Officer, just resigned, and I'm not sure what to do."

Darius was running a rapidly-growing business that was highly dependent on a well-run sales organization. He had delegated sales responsibility to his Chief Revenue Officer so Darius could focus on engineering and product.

The good news is that Darius didn't relinquish oversight or reporting of sales, just sales execution. It's also true that Darius wasn't in a panic, and we had worked on a plan for the departure of each of his direct reports.

At the moment, though, Darius and I needed to review that plan to ensure it was our best option. We checked whether or not the interim head of sales could genuinely step into the role. We discussed which accounts Darius should immediately nurture relationships with. We agreed that the recruiter we would need was still the right recruiter.

We quickly put together a communication plan on how to bring this news to the leadership team and the rest of the company. We worked on the exact next steps to interact with the interim head of sales, the director of sales operations, and HR.

Darius felt he didn't know what to do, but in actuality, he did. We had prepared for this, and he just needed to talk it through in the heat of the moment so he could execute against the plan immediately.

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The Slack Story: How Pivoting Led to a $27 Billion Acquisition

Slack is one of the cool kids.

We have a lot of love for it because we use it here at BAMF.

But, what a lot of people don’t know is that it’s the story of pivots, quality, and a focus on making customers’ lives better.

It’s an SaaS growth story that you need to pay attention to.

Today, we take a look at the Slack story and how co-founder Stewart Butterfield managed to pivot twice and revolutionize photo sharing, messaging, and the way we view SaaS.

What is Slack?

The slack story: a little background, how did it grow, slack today, fair billing, integrations, slack’s current challenges.

When Slack first came out in 2013, explaining what it did was a little complicated.

It was a messaging platform, sure, but it did more than facilitate communication.

Apart from being able to help people in one company chat with each other, it also organized chats in channels, allowed for deep app integration, native file viewing, and unlimited message history.

It was built to be deeply integrated with apps. Say you uploaded a file into Dropbox, it can automatically update a channel on Slack and inform people about the upload, the group can now comment on the file after viewing it within the Slack app.

This streamlined a lot of office communications.

Slack also helped keep track of automation, you could now have the messaging app itself ping you if you for example have a new lead coming through your pipeline.

Oh, and did we mention?

The search functionality that they have is just bomb.

It just makes all the difference, especially in business communication.

There was just so much you could do with it, that it revolutionized enterprise communication.

And, that’s when it started making waves.

It’s hard to talk about Slack without talking about Flickr.

They both share a common co-founder, Stewart Butterfield, a visionary who was the master of pivoting.

If you remember, Flickr used to be one of the top photo-sharing applications in the early 2000s, and it pioneered a lot of new technologies. Including open APIs which are now the norm with future-facing companies.

Now, Flickr used to be a unique photo-sharing feature in a video game that he created called Game Neverending .

When they found out that the game had no future financially, they decided to grab that feature and bring it to the world.

The result?

A quick pivot commercial success.

It wasn’t long before they decided to sell to the tech giant, Yahoo! for over $20 million.

However, stifled innovation and misplaced strategy from the new parent company proved to be too detrimental to everyone, and people started to leave.

When Butterfield left Yahoo!, he decided that he wanted to launch another video game called Glitch.

It, too, was a financial failure.

But, here’s what happened next.

Stewart Butterfield, Eric Costello, Cal Henderson

and Serguei Mourachov, grabbed the messaging platform that was part of Glitch , and pivoted to launch Slack.

It seems as if pivoting was really working for them.

Slack is testament to the fact that the freemium model works.

Anyone can join Slack for free, all you need is an email address and an invite to whatever workspace you want to work in.

If you want access to more advanced features such as their unlimited search and history functions, you’ve got to upgrade to their pro plan which is around $6.67, they also have a business plan that’s pegged at $15 a month.

In their first 24 hours, they managed to get 8,000 signups.

Two weeks later, it was up to 15,000.

But, here’s the thing.

This wasn’t even a full release, it was still a preview while they were still trying to learn what their prospects’ pain points were.

They knew that if they wanted to be a success, they needed to get as much feedback and study their market closely.

In early 2014, they had more than 120,000 daily users and only 38,000 paying customers.

By October, their valuation was at more than a billion dollars, and they were dominating the cloud-based messaging service.

In 2017, they were spending 99 percent of their revenue on sales and marketing, in 2019 that dropped to about 58 percent.

And, it has been growing ever since.

The thing about Slack is that they never slacked off.

They didn’t just work hard to develop a product that was loved by everyone but they also made sure that they were making waves with their sales and marketing.

It was a fight for market share and they did everything in their power to make sure that they were dominating the race.

In December of 2020, Slack was finally acquired by CRM leader Salesforce for $27.7 billion.

Imagine that.

In just about 7 years, they managed to turn a video game pivot into a company that was worth as much as the GDP of a small country like Estonia.

They’re institutional sponsorship ranges from small mom-and-pop businesses to leaders such as IBM.

And, it looks like they’re just getting started.

With the focus shifting to moving operations online, they are set to grow more into the coming years.

The Secrets of Its Success

However, there wasn’t any magic involved with its growth.

It all boiled down to a couple of factors that any SaaS or B2B company could employ in their own organizations to achieve massive growth.

Fair billing is one of the biggest characteristics of Slack.

• When Slack detects that an account is inactive, it automatically stops charging you for that account because it believes in a fair billing policy.
• When the service goes down, it will make sure that people get free credits.
• They’re free version is more than enough for casual users.

The founders realized in the beginning that you didn’t have to charge people for every single thing that they did on the platform.

And, that helped them grow a large user base in the beginning.

The founders also knew that they couldn’t do everything, but what they could do was integrate everything into their own platform.

Different organizations had different requirements, and it was impossible to keep adding features without becoming too bloated. They focused on instead getting apps to run with the features that they already have.

Now regardless if you use Google or Dropbox or any other popular solution, they make sure that it runs with their app.

The Slack story is focused on the quality of your communications.

In fact, they’re so focused on it that they provide you with a 99.99% uptime guarantee for their Business+ plan that they’ll send you over credits you can use in the future in case the service doesn’t hit those numbers.

Their rollout of new features has been slow but deliberate, focusing on only the things that will fuel communication.

It’s this focus on their competency that’s led to crazy growth over the past decade.

Slack’s product is so niched out that its only real challenge is tech giant Microsoft …and itself.

Here’s why.

Slack’s revenue could be larger, but it is focused on increasing the value that it gives to its customers.

It maintains a fairly minimal subscription fee, gives out free credits that eat into its pockets, and makes sure that customers are “paid” if ever their service goes.

For them, it’s a small price to pay to make sure that they provide services of consistent quality.

We love Slack’s story because it reminds us that you can always pivot.

Butterfield started two video games that were commercial failures turned into pivoted successes.

Now that’s remarkable.

But, beyond that was the focus on the customer.

They tested and made sure they were taking feedback.

They didn’t need to add bells-and-whistles, but they did make sure that they were killing it with their core competencies.

And, they also made sure that the pricing was as fair as possible.

It’s this continuous and obsessive pursuit of quality in the small details that led Slack to be one of the market leaders when it comes to office communications.

The Slack story is a story of how innovation in SaaS, a focus on the customer, and targeted marketing can make all the difference in B2B.

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The Ultimate Pivot Strategy Guide: How to Successfully Change Your Business

Having a reliable pivot strategy in place will help you navigate the ups and downs of the industry. Here are the best methods of pivoting the ever-changing world of business. 

For a business to succeed in today’s competitive market, it needs a solid pivot strategy. Pivoting allows a business to respond to crises quickly and efficiently. 

With issues like high inflation , having pivot strategies in place will allow your business to survive and thrive. You have to adapt to change to stay relevant and competitive and meet the ever-changing demands of the market.

What Is A Pivot Strategy in Business? 

When used in business, the term pivot strategy refers to a planned and dramatic change in a company’s course. This is usually brought on by shifting market conditions, client demands, or internal dynamics. 

Pivoting entails reassessing the current target market, product line, and business model to make significant changes to the company’s operations. The goal is to shift and align business processes to accommodate the current trends. By focusing on a new approach that better fits the changing landscape, the pivot strategy enables the company to overcome challenges.

Top Reasons to Pivot

Now that we’ve established what a pivot strategy is and how it helps a business, let’s talk about what drives it. Here are the key factors that determine a company’s need to pivot: 

Market Dynamics

Markets are extremely dynamic and are dependent on various factors, including changes in consumer tastes, economic trends, technological breakthroughs, and industry disruptions. Businesses need to keep an eye on these changes and modify their tactics as necessary to be competitive. 

As an example, the growth of e-commerce has forced conventional retailers to create online platforms and modify their business strategies.

Customer Demands

Over time, customer demands and expectations change. Businesses must continuously evaluate consumer feedback, market research, and trends. This way, they can better comprehend their target market and deliver goods or services that satisfy their shifting needs. Market share and competence can decline if you don’t adjust to changing client preferences.

Technological advancement is significantly influencing and driving change in the business landscape. With tech giants introducing new tools every year, they tend to disrupt various industries. And if companies fail to adapt and integrate these new technologies, they risk falling behind their competitors. For example, companies that didn’t jump on the digitalization trend now face the challenge of reaching wider, tech-savvy consumers.

Competition

Competitors are continuously looking for ways to gain an advantage, which frequently entails launching novel goods, services, or business strategies. Businesses need to keep an eye on what their rivals are doing. They can evaluate tactics, be ready to change course if required, and plan a good pivot strategy to stay ahead.

Internal Factors

Changes may take place even within an organization. These changes may be due to organizational development, mergers and acquisitions, management restructuring, or adjustments in organizational goals. These internal variables might necessitate alterations to operational procedures, staff responsibilities, or overall strategy focus.

On top of the abovementioned factors, here are other reasons to create a pivot strategy: 

• To respond to technological or other world changes
• To increase revenue through market expansion
• To maintain relevance in the industry
• Address market testing data
• Evolve the business through a business pivot

We’ve discussed these items in depth in another blog.  

Tips on Creating Your Pivot Strategy

Change is necessary. And it should be handled carefully and thoughtfully. Businesses need to do an in-depth analysis, assess the potential effects of change, and create workable plans to reduce risks brought on by new directions. You need to balance flexibility and a clear vision to ensure that changes are in line with the overall business objectives. 

Here are some tips for planning and executing your pivot strategy. This will help you reduce the risks involved in pivoting and raise your chances of having a successful outcome:

1. Make sure you really need to pivot

Pivoting puts a lot of things at stake. If not done right, it can turn a challenge into a full-blown crisis. And you’ll end up losing more than not doing anything at all. So, it’s important to evaluate the situation carefully. 

Is it the right time? Are you equipped with the right people, money, and resources to make a major move? Never bite off more than you can chew.  

2. Pivot as soon as possible 

Pivoting too late is just as bad as pivoting too soon. Once you’re sure that the situation calls for drastic measures, you need to act fast. To prevent losing time, effort, and money, you must pivot as soon as you have all the plans and resources in order. 

3. Keep what’s working

Although some pivot strategies entail foregoing certain parts of your operations, this doesn’t mean scrapping all the work you’ve done. You can shelf some of your original ideas and processes, and revisit them later. 

Identify which aspects of your operations can still be useful in the long run. After all, you’ve invested a good amount of time, energy, and money on them. It’s simply a matter of redirecting these existing resources to meet new goals.

4. Listen to your customer feedback

The feedback you receive from customers is an excellent indicator. While occasional negative feedback is expected, if you’re constantly getting repetitive criticisms, use it to your advantage and adjust. The common customer complaints are typically about your prices, problematic features of your product, customer service, or overall user experience. Take these as a baseline to pivot. Improve areas that customers are pointing out. 

5. Make sure your pivot presents growth opportunities 

If you lead your startup in a new direction without much thought as to where you’re going next, chances are, you’ll hit yet another roadblock. New issues could occur under different circumstances. To prevent this, ensure you research everything regarding your new path expansion. If the market is smaller, the customer base is less diverse, or has too much competition, it’s not worth risking. It’s better to keep looking at other options. 

6. Plan your pivot

Pivoting without a plan is like steering a ship with no destination in mind. Once you’ve set your goals, you have to plan out the steps to achieve them. A pivot plan should outline the company’s steps to implement the pivot. It should include timelines, resource allocation, and key performance indicators (KPIs) to measure its success.

7. Monitor and revise

Lastly, once you start executing your plan, keep track of the progress. You have to regularly monitor the pivot’s progress to integrate it into your company’s scaling trajectory. This allows you to evaluate whether the shift is indeed producing the results you’re aiming for. 

Grow Your Business with Full Scale

Planning to scale your business? Pivoting to new services? We can help you bring your business to the next level.

Full Scale lets you expand your team fast and affordably. We locate, screen, hire and manage the best IT professionals in the market. We give organizations access to a broader pool of professionals for their initiatives. We manage all the time-consuming tasks involved in recruiting, onboarding, and managing remote personnel. We’ll help you identify competent software experts who are a perfect fit for your project.

We’ll help you put up the necessary management and communication solutions to keep your business functioning smoothly. We specialize in developing reliable teams for lengthy projects. Create a team with Full Scale!

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The 4 Best Business Strategy Pivots That I Have Ever Seen!

An Overview of Business Strategy Pivots

The concept of strategically pivoting a business is HARD. Planning and running an effective business strategy is difficult in itself, let alone then having to be able to understand, recognize, and know what, when, and how to Pivot!

In this article I will cover:

• What pivoting is
• When it is needed
• How to do it
• An example of what happens when a business fails to pivot
• The 5 best strategy pivots by non-tech businesses I have ever seen!

Historically, business strategy has almost been considered as an afterthought. You only have to look at the search history for “strategy pivot” and you’ll see significant spikes in search volume after monumental global disasters such as the GFC and the initial few months of Covid-19.

Why is this the case? Do businesses not realize the importance of strategy? Do businesses not know how to develop a strategy? Is it just human nature to avoid recognizing the worst-case scenario? 

Whatever the reason may be, the failure to strategically plan leaves businesses in damage control when the unthinkable happens. This doesn’t have to be caused by a globally significant event, most commonly a change in a business's environment creates the need to pivot.

The issue of businesses failing to pivot strategy generally stems from a poorly developed or nonexistent strategic plan. Thus there is understandable confusion about how to pivot a business, as pivoting is not an easy task even for strategically aligned businesses.

There are a number of factors to consider and tough decisions to be made, making it one of the hardest things a business can go through.

Business Strategy Pivoting, What, When & How?

What is Pivoting?

While the term 'pivoting' is not frequently used in big corporates who are generally focused on staying the chartered course, it has been ingrained within startup culture for a long time.

Whilst pivoting means to change direction to a new strategy, the change itself doesn’t always have to be monumental and groundbreaking. For example...

What a Pivot Must Be:

• Seeking long term alignment with consumer trends 
• Reaffirming strategic intent through a lateral extension of existing capabilities 
• Enhancing value through pursuing sustainable growth and profitability

When to Pivot?

Pivoting is generally the final option, businesses should exhaust all other avenues prior to making the decision to pivot strategy. Pivoting too early may result in missing an opportunity in the current situation that wasn’t initially identified.

Some common signs that indicate a business needs to adapt and/or potentially pivot:

• Constantly trailing competitors
• Too much direct competition
• Plateaued for an extensive period of time
• Only has one successful element, the rest fail
• Market unresponsive to product/service
• Unprofitable long term   

How to Pivot?

There are a number of components that are required to quickly and effectively adapt and pivot the strategy of a business. Here at Cascade , we believe in an Alignment, Action, and Adaptation approach to strategy.

It is incredibly important during a pivot to make sure everyone is aligned. The next two stages are to act out the strategy with purpose and to adapt efficiently and effectively when required.

• A customer-centric approach to strategy, balancing what customers want with what customers need
• Culture/People, the businesses employees drive the change
• A data-driven response, people lie, numbers don’t
• Current and future visions with goals 

What Happens When You Fail to Pivot? The Blockbuster story

The notorious example of a business failing to adapt and pivot in response to the dynamic business environment is Blockbuster.

In the year 2000 Blockbuster was approached by Reed Hastings, co-founder of a company you may now know as Netflix. Mr Hastings was laughed out of the room after he proposed digitizing Blockbuster into an online platform (Netflix). 

Blockbuster is the case study for what happens when you fail to strategically pivot. In the space of 10 years, Blockbuster went from market dominance to bankruptcy.

Blockbuster had a strong, rigid strategy with a traditional management team and this is why they failed. Blockbuster didn’t consider or account for change and thus never felt the need to adapt or pivot their business strategy, making this is one of the worst business strategies I've seen.

Businesses that stay too rigid to their initial strategy do not survive, or in the words of HG Wells “Adapt or perish, now as ever, is nature's inexorable imperative.”

The 5 Best Non-Tech Business Strategy Pivots

Kutol products company (play-doh).

Play-Doh had an interesting journey to becoming one of the world’s most popular children’s toys. This journey started back in the late 1920s at Kutol Products Company, a soap manufacturer in Ohio when Cleo McVicker started working at Kutol.

Fast forward a few years and Kutol was close to going out of business until Cleo negotiated a contract in 1933 with Kroger grocery stores to produce and manufacture wallpaper cleaner to be sold in Kroger stores. 

Cleo’s brother Noah developed a safe shapeable clay-like compound made from water, salt, and flour. The product was a success and kept Kutol in business for the following 20 years. Cleo passed away in 1949 and his son Joseph took over the business.

Sales of the Kutol Wallpaper Cleaner plummeted in the early 1950s as homes converted from coal to oil or gas based furnaces following World War II. This is due to the fact that oil and gas furnaces didn’t produce the soot that the coal furnaces did. 

Kutol’s Wallpaper Cleaner was first used in the fashion of what we now know as Play-Doh in 1955 by Joseph’s sister-in-law, a school teacher who showed him what design her class had made using the Wallpaper Cleaner. The formula was then altered for the purpose of making a children’s toy.

Kutol made the pivot in 1956 as Joseph established the subsidiary Rainbow Crafts Company, which packaged what we all now know as Play-Doh. This is one of the most iconic business strategy pivots and it’s not even that well known.

How Play-Doh exists today is partly due to the McVicker’s creativity and willingness to explore different products and industries. The fact that this pivot came from an accidental open-ended innovation is special and provides a great example for other businesses in regard to product fit and pivoting.

Wrigley, the now iconic American chewing gum company was founded in Chicago by William Wrigley Jr in 1891. The Wrigley story showcases the potential that pivoting a business can have when consumer trends are recognized and aligned with.

Wrigley didn’t initially start off manufacturing and selling chewing gum. When William Wrigley Jr moved to Chicago in 1891 and started Wrigley’s, the business sold soap. 

Wrigley was offering baking powder as a free incentive to buy soap, however, the baking powder quickly became more popular and desired by consumers than the soap.

This was Wrigley’s first pivot as in 1892 he started to sell the baking powder alongside his soap. The baking powder shortly became the primary product sold by Wrigley.

Wrigley continued his premium strategy offering free chewing gum packets with every baking powder purchase. As you can probably guess it didn’t take long for the chewing gum to become more popular than the baking powder itself.

So in 1893 Wrigley pivoted again, abandoning both baking powder and soap to manufacture and sell chewing gum.  

Pivoting a business as drastically as Wrigley did twice in three years can be viewed as a high risk high reward situation. Normally that would be true, but Wrigley was in a unique situation.

His free offerings of baking powder and chewing gum were essentially product trials. This meant that Wrigley was pivoting his business in alignment with consumer trends, as consumers approved of his baking powder and then his gum.

These pivots were effective as Wrigley already had the existing capabilities to produce and provided the opportunity for greater sustainable growth.

The 2019 US Chewing Gum Market Share, Wrigley’s also own Orbit among other brands

Chipotle Mexican Grill is a great example of an effective business pivot by a non-tech business. Like quite a number of strategic pivots, Chipotle’s came off the back of disaster.

The prominent fast-casual taco & mission burrito restaurant experienced every restaurant chain’s worst nightmare back in the latter stages of 2015 into early 2016. Chipotle was responsible for two E. coli outbreaks that resulted in around 55 people being poisoned.

This along with a number of other food safety issues caused PR chaos as the public became scared to eat at Chipotle. This resulted in store closures, a drop in sales by approximately 20%, and a plummeting share price.

The events that had unfolded required Chipotle to pivot its overall strategy to align long term to the improvement of food safety standards and to regain and maintain consumer confidence.

Chipotle reaffirmed its strategic intent by adapting its food storage and preparation standards, prioritizing hygiene through strict employee protocols in conjunction with the installation of improved air filtration systems. 

This pivot to a prioritized health and safety strategy prepared Chipotle to thrive in the madness that was 2020. When the Covid-19 pandemic shut down the world as we knew it and the hospitality industry was left scrambling, Chipotle was already set up for these circumstances.

Brian Niccol, Chairman & CEO of Chipotle said that “the only two things we had to implement during Covid-19 was the idea of social distancing and wearing masks”.

Chipotle was able to adapt to the new reality quickly implementing strategies such as contactless delivery, drive-thru for mobile orders, and a digital-only menu. 

These small adaptations to their strategy enhanced Chipotle’s value and allowed them to continue pursuing sustainable growth and profitability.

Which they did successfully, as Chipotle increased total revenue by 7.1% to $6USD Billion from 2019 to 2020.

A large portion of this increase can be attributed to the 174.1% increase in digital sales to $2.8USD Billion, which totaled 46.2% of sales in 2020. Visualize your own strategy in our  Free Health & Safety Strategy Template!

As we all well know (and are sick of being reminded about!) Covid-19 temporarily changed the entire fabric of our existences.

Whilst things are starting to return to some form of normality for the majority of the world, the impact that Covid-19 has had on some businesses will remain.  

The multinational consumer goods company Unilever is an example of a Covid related pivot. With over 400 brands Unilever’s products span across the foods & refreshments, home care, and beauty & personal care industries.

Unilever’s product demand was impacted by Covid as demand for products like hand sanitizer skyrocketed whilst demand for things like beauty products decreased. 

Unilever reallocated resources to enable increased manufacturing of hand sanitizer and other in-demand products. Unilever was able to successfully pivot in this manner, as they aligned to the new consumer demands through a lateral extension of existing capabilities.

This contributed to Unilever only posting 2.4% less global revenue than in 2019. Unilever also donated over €100m of soap, hand sanitizer, bleach, and food during 2020 to aid the global response to Covid-19.

Unilever Global Revenue 2007-2020 in Million Euros

To conclude, it is understood that strategically pivoting a business is a hard decision to make and act upon. The aim of this article was to provide the what, when, and how of pivoting.

Along with giving 5 excellent examples of great business strategy pivots, and an example of what happens when a business fails to pivot. Designed to visualize your own business's strategy and potential to pivot.

Now, if only there was a platform to align, act, and adapt your own strategic pivot...

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7 Successful Business Pivot Examples

December 18, 2019 • Leadership Lessons , Strategic Alignment

Hindsight is a gift. Let’s unpack a few bold decisions made by companies to either completely re-invent or shift their business model.

Business Models are always subject to change, but as start-up culture has risen to prominence and the lingo entered the business world, one term has been particularly popular: The Pivot.

Pivoting means to shift an essential part of your business strategy — either in regard to a product or the business model. This often includes drastically changing parts of the company.

For an established player to pivot is a very different thing compared to a startup still trying to find a working model, perhaps even the actual product. For most start-ups, pivoting is part of the process.

For our purposes, we’ll think of Pivots in a broader sense. In order to do so, we want to look at examples from start-ups and larger companies to see what business model change can look like in practice:

1. What3Words

The London start-up has divided the world into 3x3m squares and named all 57tn of them with three words to identify them individually. This allows for quick and easy sharing of a very specific location. For example, instead of meeting somebody “somewhere in Bryant Park”, the three words   splash.bonus.lonely  would lead to the  actual bench  you are waiting on. Couriers don’t have to read special instructions to find a side entrance.

To say that What3Words pivoted might be slightly exaggerated, but it did learn quite a lot about a simple idea having very different markets in different regions that can work as a catalyst.

In Mongolia, where there are places with no actual the postal addresses and a large number of the population are nomadic, the national addressing standard runs on What3Words. In Germany, where finding an address is not that much of a pain point, they have achieved a milestone with Daimler investing in the company and Mercedes-Benz integrating the address system into their cars, recognizing that entering addresses into a navigation system in a car is anything but smooth.

All the while, in its native UK, What3Words hadn’t caught on in a big way until it focused on emergency services. The result was a hugely successful PR campaign, with headlines like “The App that can save your life” on BBC News paving the way to much wider adoption.

Especially big ideas will have different journeys in different markets whose needs might differ greatly.

2. Nespresso

Nespresso was a brand built around exclusivity. The “Ultimate Coffee Experience” was only available in selected stores or of course their own boutiques, where coffee pods were presented like jewelry. Signing up to the Nespresso Club is part of the unpacking ceremony.

Nespresso hasn’t abandoned its strategy to sell a high-end coffee experience, but as compatible capsules are available in every store, Nespresso seems to be keen to simplify the buying experience in certain markets. In Switzerland, the pods will be available at newsstands at train stations, even via a self-serve counter. The move is a clear break with the distribution model they have pursued so far.

Nespresso has been careful not to dilute the strong brand, but they also know that every part of a brand’s business model, especially one as successful as theirs, needs to evolve to keep customers loyal:  what brought you here doesn’t necessarily get you there.

3. Microsoft

Change is harder for big companies with an already working model already and not many are bigger than Microsoft.

Over the last decade, Microsoft’s journey (maybe because of its reluctance) has been a great case study illustrating how the software and hardware business has evolved.

Under Steve Ballmer, the company completely missed the smartphone revolution. In an interview in 2014, Ballmer acknowledged this, but he also made the point how hard it was to change the mindset inside Microsoft: “When the name of your company is Microsoft and your formula works… Our Formula was working! […] We were software guys.” The big transformation in his eyes was the Surface, the first high-end hardware device and he calls the transformation an almost religious one.

To envoke the term “religious” is the giveaway there. In terms of describing a culture that is resistant to change, that is as resistant as it gets.

Taking over from Ballmer in 2014, Satya Nadella has changed Microsoft again. He saw the future in cloud services and a mobile-first approach. Nadella made it his mission to transform Microsoft’s relationship with the market and its place in it. In his first public appearance, he never mentioned Windows once. While it wasn’t commented on widely at the time, it represented a huge shift. Microsoft had been a company that was centered around that one product: Windows. But the days of locking customers into the Microsoft ecosystem were over. Collaboration with other platforms and partners and open APIs started becoming possible.

Nadella is widely credited as the main reason behind Microsoft’s growth and culture change.

Nadella gave Microsoft a new purpose: to empower every person and every organization on the planet to achieve more.

Other than pushing a product, the question for companies needs to be: What are our customer’s expectations of us? How have their expectations changed and are we still helping them to achieve their goals?

Stewart Butterfield built Slack out of a gaming company called Tiny Speck. During game development, the company had created a collaboration tool to improve the productivity of their ever-growing team across the country. When it became clear that Tiny Speck was not living up to expectations, Butterfield used the rest of the VC money to completely Pivot and try to make their internal collaboration tool the main product.

Friends in other companies were invited to try Slack and it caught on, eventually becoming the fastest-growing company of all time.

This is a very successful Pivot story. One could argue that when the complete shutdown of a company is all but certain, the opportunity cost of starting completely fresh is relatively low. However, it still needed people to recognize the innovation that was going on in an area of the company that was not part of their value proposition or purpose.

Finding innovative projects inside the company that are contributing value and growth can lead to new business models inside a company.

As we optimize our own processes and operations, are we hitting on something that could be of value to the market?

Over the last decade, the historical toy manufacturer has shown itself to be very able to experiment and make some brave decisions.

As early as 2013, the company has gone into a partnership with 3D Systems in order to allow people to create and print their own toys at home.

At a time where, admittedly, 3D printing wasn’t accessible enough to become a real disruptor for toy manufacturers, Hasbro has ventured out into the maker communities like SuperFanArt at a time when big companies hadn’t quite caught on to the power of fan communities yet.

Another initiative, Spark Hasbro, encourages people to submit their ideas to Hasbro with a chance to see their idea or design produced.

In all of this, however, the most significant shift has been the change from being a manufacturer to being an entertainment company. In 2017, Hasbro started producing animated films (My Little Pony) through their animation studio All Spark. Instead of licensing brands, Hasbro is all about creating new IP.

The company has also ventured into publishing this year. Instead of selling toys, Hasbro is bringing out a new children’s book set in “Cubby Hill”, developing a brand as a book series before releasing merchandise.

Branded products have always been a competitive market and licensing intellectual property is expensive. Knowing that IP is a powerful growth generator, Hasbro is going from being a manufacturing company to a global “play and entertainment company”.

Creating characters and stories for their customers is also a form of talking directly to the customer base. The demise of Toys’R’Us has shown how important it is for a company to build a direct relationship with their customer. Hasbro is almost a hundred years old. Most of that time it spent separated from the customer by the retailer.

Global CHRO Johnson said in an interview:  “We must continue to think of ourselves as a learning company and challenge the way we think about everything.”

We close with a classic start-up story. Maybe outshined by the oscar-winning retelling of Facebook’s origin story in “The Network”, YouTube’s start as a dating website is less well known. Looking at what it has become, it is strange to think that the people behind one of the first video sharing platforms didn’t see the potential beyond dating right away. The first YouTube slogan was “Tune in, hook up.”

Nobody then could predict that the video platform could change the media landscape forever, becoming the most global powerhouse for user-generated content, turning a whole generation into filmmakers, editors, and influencers in the process.

YouTube scrapped its whole value proposition and let the users decide how they were going to use the platform.  What if you gave your resources and capabilities into the hands of your customer? What would they do with it?

Aish Hinton

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5 Remarkable Business Pivots That Led to Astounding Success.

In this blog post, we will be looking at 5 remarkable business pivots that led to astonishing success. Hence, we look into why it is essential to pivot for better success.

In the ever-evolving world of business, the ability to adapt is paramount. Many iconic brands we know today started with entirely different business models. Their success can be attributed to a strategic pivot at the right moment. Let's explore some standout examples.

1. Slack: From a Gaming Company to Collaboration Software

Originally called Tiny Speck, the company's primary product was a game named 'Glitch.' However, when 'Glitch' failed to gain traction, the team recognized the internal tool they'd built for communication was valuable. This tool later became Slack, a leading platform for team collaboration.

2. Twitter: A Pivot from Podcasting

Before becoming the microblogging sensation, Twitter was Odeo, a network where people could find and subscribe to podcasts. As Apple's iTunes began dominating podcasting, Odeo's team developed a short messaging service project during a hackathon. Thus, Twitter was born.

3. Groupon: Transitioning from Social Activism

Groupon's initial model, The Point, was about rallying people around causes or negotiating bulk deals. When they realized the potential of their deal-of-the-day concept, Groupon emerged, becoming an e-commerce giant.

4. Nintendo: From Playing Cards to Video Games

Few realize that Nintendo, the iconic gaming company, started in 1889 as a playing card company. After venturing into various sectors, they landed on video gaming in the 1970s and haven't looked back since.

5. Airbnb: From Air Mattresses to Global Lodging

Airbnb began as "Air Bed & Breakfast," a platform where hosts offered air mattresses to guests. Recognizing the potential beyond temporary bed solutions, the founders expanded to include various property types, giving birth to the global platform we know today.

Challenges with Pivoting

While these success stories inspire, pivoting isn't without its challenges. The decision to pivot can alienate initial customers and requires a significant re-allocation of resources. Moreover, businesses must combat internal resistance, as employees and stakeholders may be wedded to the original vision.

Arguments Against Rapid Pivots

Some critics argue that frequent pivots might indicate a lack of clear vision. Rapid shifts can dilute a brand's essence and confuse customers. Further, constant change can exhaust and frustrate a company's team, leading to decreased morale and increased turnover.

Conclusion:

Pivoting, while potentially transformative, is a nuanced decision. The businesses highlighted above benefitted immensely from their shifts. However, it's vital to ensure the pivot aligns with the brand's core values and serves a genuine market need. Ultimately, the key to a successful pivot is agility combined with deep market insight.

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Pivots: Part 5 | Pivoting: Case studies (PayPal, Flickr and YouTube)

This is from the lost section from The Growth Hacker’s Guide to the Galaxy . Mark Hayes and I wrote that book a few years back and went deep down a rabbit hole on the topic of pivoting. Before long, we had too much pivoting content and it got cut from the final manuscript. Now it rises like a phoenix from the ashes as a seven-part blog series . Make sure you stick around until Part 7 —it promises to raise some eyebrows.

In this series , we could go on and on about pivoting, but odds are you’ll learn the most when presented with examples of successful pivots.

PayPal’s pivot

Let’s take a look at PayPal , a company that took a very circuitous, customer-focused approach to pivoting and to growth.

The PayPal we know today is a platform that makes it easy for people to securely send others money using only their email address. It also allows for businesses to easily conduct online transactions, say, for their e-commerce store.

But PayPal didn’t start out that way.

In an interview with Fast Company , Reid Hoffman (former executive vice president of PayPal) talks about the story of PayPal and its pivots. The company has an interesting history because it went through a number of pivots and its story follows a nice arc.

With that in mind, let’s explore each of PayPal’s pivots, right from the start.

The beginning

In the beginning, the company wasn’t even known as PayPal. It was called Confinity and was designed to provide encryption on mobile devices. The idea was that someone else would build an application that would then require Confinity’s encryption technology.

The company quickly realized that it was dependent on others to build applications and decided to shift course.

The first pivot

Confinity changed its focus to building an application that could use of its encryption technology, and decided to build an application related to financial transactions on a mobile phone.

Soon after this, the company saw that it would take years for mobile phones to be able to effectively handle financial transactions and it again changed direction.

The second pivot

The company turned its attention to financial transactions between PalmPilots. It did this in the hope that this approach would make it easy for them to eventually service financial transactions over mobile phones—its ideal scenario.

The third pivot

It didn’t take long before the company realized not everyone had PalmPilots.

Reid Hoffman, one of those working at the company, explored a potential use case that highlighted this problem. He detailed a scenario where a group of people went to dinner and wanted to split the tab after dinner.

He questioned how many people at that dinner table would actually have a PalmPilot. Reid argued that you’d only be able to split the dinner tab successfully if everyone had a PalmPilot, a scenario that was rare.

So the company decided to adjust its approach.

The fourth pivot

The company focused on PalmPilot and email payments and called this new system PayPal.

Soon they found that the email payment feature was being used a lot and having a significant impact on the business. The PalmPilot payments, though, weren’t that popular in comparison.

The fifth pivot

Confinity then decided to drop PalmPilot payments and focus only on email payments. This meant that they concentrated on the web and doubled down on the concept of web payments.

All of these changes happened during the space of 15 months.

Over time, the company noticed a lot of traction amongst eBay users, as buyers and sellers were using PayPal to complete transactions. It now realized that these individuals were its customers.

The company decided to focus on this core group of people and the general idea of buying and selling things online, which at that time related to heavily to eBay, but eventually spanned web-wide payments.

While eBay initially had its own online payment service (Billpoint), it eventually gave in and bought PayPal for $1.5 billion in July 2002.

You can see how everything we’ve discussed so far in this series in terms of finding a way to best serve customers comes to fruition in the story of Confinity, later known as PayPal.

Yet, what’s even more important, was that timing was arguably a big factor in PayPal’s ability to succeed. eBay was a big part of PayPal’s success and had eBay not been gaining as much traction as it did, PayPal’s story may have gone a little differently.

Flickr’s pivot

Flickr , as it is known today, is a photo-sharing site that is used by millions of people around the world.

But it originally started out as a massively multiplayer online role-playing game (MMORPG), known as Game Neverending.

One of the features of the game was that it allowed players to take photos and then save them to the web for everyone else to see.

This feature quickly became one the most loved aspects of the game and it was at this point that the founders decided to launch Flickr.

YouTube’s pivot

You probably know a lot about YouTube ’s current popularity already.

To begin with, it was a video-dating site with the slogan, “Tune in, hook up,” and was designed to be like the video version of “Hot or Not.” This idea didn’t take off—even when they tried to pay women $20 to put videos on the platform.

Nevertheless, despite this initial failure, they still had a technology that enabled people to easily upload videos to the internet.

Next in this series

In Part 6, we look at different types of pivots and their interdependencies.

Read more in this series

Pivots: Part 1 | Why is pivoting important? Pivots: Part 2 | The search for product–market fit Pivots: Part 3 | Why most startups fail at finding product–market fit Pivots: Part 4 | Some pivoting myths Pivots: Part 6 | Types of pivots Pivots: Part 7 | A word of warning about pivoting

Pivots: Part 6 | Types of pivots

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How to plan and implement an effective company pivot.

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Entrepreneur, Innovator, Advisor. Presently, Founder & CEO at Intellective , a ServiceNow Elite Partner leading platform innovation.

When it comes to making an effective company pivot, it is essential that the process is well-planned. This means having a clear objective in mind so you know exactly what direction you want your company to move in and how long it will take to get there.

After navigating a pivot in one of my own companies, I also learned that it's important to have data collected and analyzed before implementing the pivot, as this can help inform decisions about which path might be most beneficial for your business. Additionally, once everything has been planned out, decisive action must be taken quickly in order for the pivot to be successful; waiting too long can lead to missed opportunities or the need for additional resources that weren't accounted for ahead of time.

With careful planning and swift execution, companies will have a better chance of achieving their desired outcome during a pivot.

A thorough analysis of the company's current situation and a well-defined strategy for the pivot should be conducted before any action is taken. This analysis should include an understanding of the market, trends, customer needs, opportunities that could be leveraged and risks that need to be managed. The team responsible for this pivot must ask questions such as “What is our competitive advantage?” “How can we capitalize on emerging trends in our industry?” and so on.

Additionally, the company might need to conduct surveys or interviews with customers to gain insights into their needs and preferences. By taking a comprehensive approach to analyzing the current situation in order to develop an effective strategy for the pivot, companies can ensure they are making informed decisions about how best to move forward with their business goals.

When planning and implementing a company pivot, it is essential to define measurable objectives that will help assess the success of the change. These objectives should be specific, achievable, relevant and time-based in order to ensure meaningful results. Examples of such objectives could include increasing sales by 20% within six months or reducing operational costs by 10% over the next three years.

It is important to track progress toward these goals during implementation so you can measure performance against expectations and make necessary adjustments along the way if needed. Additionally, establishing key performance indicators can also provide valuable insight into how well your pivot is performing and whether any further changes need to be made for it to reach its full potential.

Creating a timeline for the pivot is key to ensuring the project is completed in a timely manner. The timeline should include all of the necessary steps required for successful implementation, such as identifying goals, performing market research and customer surveys, collecting feedback from stakeholders, developing strategies and solutions, assembling resources and assigning tasks.

This plan should also have milestones along the way that indicate when each step has been completed or needs additional attention.

Finally, it’s important to build flexibility into your timeline so you can adjust according to any unexpected changes or delays. Following this process will help ensure your company pivot is implemented effectively within an appropriate timeframe.

When planning and implementing an effective company pivot, data should be used to inform the decisions that are made. This includes data on customer needs, such as what products or services they need and what their preferences are; market trends, such as which industries are growing or declining; and competitor analysis where a company can see how its competitors operate in order to adjust its own strategies for success.

All of this information is key when making informed decisions about pivoting your business so that it will remain competitive and profitable in the long term.

When the plan is finalized and ready to be implemented, it is important that decisive action is taken. This should include communicating with all stakeholders involved in the company pivot so they are aware of any changes being made and can provide feedback on how to improve them. Additionally, it's important to obtain feedback from customers who might be affected by the pivot as well; their input could help shape or refine the plan moving forward.

Finally, make sure you are willing to adjust your plans according to customer or stakeholder feedback. While having a solid plan in place is great, it's also important that you're flexible enough to make changes if needed for optimal success.

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The Strategic Pivot: Rules for Entrepreneurs and Other Innovators

• Caroline O'Connor and Perry Klebahn

Silicon Valley culture is built around great pivots — a sudden shift in strategy that turns a mediocre idea into a billion-dollar company. Groupon began not as a local coupon business, but as a platform for collective action. Pay Pal started back in 1999 as a way to “beam” money between mobile phones, Palm Pilots, […]

Silicon Valley culture is built around great pivots — a sudden shift in strategy that turns a mediocre idea into a billion-dollar company.

• CO Caroline O’Connor is a Fellow at Stanford University’s Hasso Plattner Institute of Design (the d.school). Perry Klebahn is a Consulting Associate Professor at the d.school.

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Create a report in excel for sales data analysis using Pivot Table Techniques

Create a report in excel for sales data analysis is an important aspect of any business. Unless you are able to measure and analyze data, how can you improve your performance? It’s true that improving performance is a whole new story, but unless your data measurement isn’t accurate, you can never hope to reach the next level.

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Why it’s important to do data analysis?

Nowadays, competition has increased immensely in every field; no matter which product you are trying to promote, you can be sure that there are several other competitors trying to promote the same product. Hence, you need to collect all sorts of data to keep track of your progress. However, gathering data isn’t enough, you need to properly analyze that data.

In fact, statistics show that this is the main part that separates successful companies from mediocre ones. The better you are able to analyze the data, the more information you have about your progress, and hence, you can create a proper and accurate plan on how to improve your position. Fortunately, there are several tools available nowadays to analyze data. One of the most powerful software is Microsoft Excel, which provides several features for data analysis. Today, we shall discuss an important feature via Excel training on the pivot table.

What is a pivot table? & How to use it?

Firstly, let’s discuss what is a pivot table and it’s importance. A pivot tool can be thought of as a mechanism to summarize huge amounts of data. It is mostly used to understand and recognize patterns in the data set. Recognizing patterns in a small dataset is extremely easy. But as the size of the dataset increases, the effort required to find the patterns will increase exponentially.

In such cases, a pivot table can be a huge asset since it takes only a few minutes to summarize groups of data using a pivot table. Consider the following example. You have a dataset consisting of regions and a number of sales (normally there will be many more columns, but for simplicity, this is kept at 2).

You are interested in knowing the number of sales based on the regions, which can be used to determine why a particular region is lacking and how to possibly improve in that area. Using a pivot table, you can create a report in excel within a few minutes and save it for future analysis.

Steps to create a report in excel using a pivot table

Creating a pivot table is extremely easy in Excel. Just follow the steps below to create one for your dataset.

• Step 1: Select any cell in your dataset.
• Step 2: Choose the option PivotTable from the Insert menu.

• Step 3: You will be presented with a dialogue box and the cells will be already selected. Choose OK.
• Step 4: Give a name to your pivot table, and on the right-hand side, you will notice the field names.
• Step 5: Choose the appropriate field names to generate the required data.

Your pivot table will be created instantly. With practice, it shouldn’t take you more than a minute to perform this task.

Pivot Table Calculated Field

Another important feature of the pivot table is the calculated field table. Basically, these are table fields which can also calculate values. Consider the following example to understand better. In your dataset, you have two fields – “sales” and “profits”. Now, you want to calculate profit per sale or the percentage profit. A straightforward solution would be to add another column to calculate this. However, if you know calculated fields, you don’t need to do the extra work; simply create custom fields to generate data.

The following steps will show you how to create one such field.

• Step 1: Select the option “calculated field” in the “Formulas” menu.
• Step 2: Add the necessary formula to the field (in this case, it will be profit/sales*100).
• Step 3: Click on OK, and now give an appropriate name.

Your calculated field is ready! You will find that you are using this feature often, since you don’t have to create any new columns for additional data and can easily generate one in a few seconds.q

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Create a report in excel for sales data analysis using Advanced Pivot Table technique

The pivot table can be used to perform several other tasks as well. Some of these include:

1. Categorize daily data on a monthly or yearly basis You can group data from the daily dataset based on a month or a year using a pivot table. Moreover, you can also categorize it into custom groups, e.g. if you want to group it at an interval of 10 days, you can easily achieve that.

2. Use Slicers Slicers can be used to create visual reports in excel (graphs, charts, etc.) from pivot tables.

3. Use Report filters Another feature in Excel, It is used for various types of reports from a dataset within a few seconds.

Hopefully, you can now understand why a pivot table is important. Data analysis is a tough job, but your workload will be significantly reduced if you can properly use this feature.

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We estimate fine particulate matter (PM2.5) concentrations daily using MODIS satellite observations of aerosol optical depth (AOD) for a major biomass burning event around Moscow during summer 2010. Evaluation of MODIS AOD with the Moscow AERONET site supports a MODIS-AOD error estimate of ±(0.05 + 0.2 x AOD) for this event. However, since the smoke was often thick (AOD > 4.0) and spatially variable, the standard MODIS algorithm incorrectly identifies some aerosol as cloud. We test relaxed cloud screening criteria that increase MODIS coverage by 21% and find excellent agreement with coincident operational retrievals (r2 = 0.994, slope = 1.01) with no evidence of false aerosol detection. We relate the resultant MODIS AOD to PM2.5 using aerosol vertical profiles from the GEOS-Chem chemical transport model. Our estimates are in good agreement with PM2.5 values estimated from in-situ PM10 (r2 = 0.85, slope = 1.06), and we find that the relationship between AOD and PM2.5 is insensitive to uncertainties in biomass burning emissions. The satellite-derived and in-situ values both indicate that peak daily mean concentrations of approximately 600 µg m-3 occurred on August 7, 2010 in the Moscow region of the Russian Federation. We estimate that exposure to air pollution from the Moscow wildfires may have caused hundreds of excess deaths. © 2011 Elsevier Ltd. All rights reserved.

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