The "Pivot." It's a word that's been bandied about a lot during the pandemic, as people and businesses rethink priorities and the way things have operated up to this point. In its essence, a pivot is not only the act of making fundamental changes, it's also a noun, the mechanism by which you can turn towards or away from something.
So what's in a pivot? In a business context, there are a multitude of stakeholders and considerations to weigh. And in retail, there's the particular complexity of your brand and its perception amongst consumers. That's why, today, we're discussing the fundamentals of making a pivot.
Let's be honest...
When you're considering a pivot, in many cases, it was clear what you were doing before, wasn't really working. The path you were heading down took you towards irrelevance to consumers, lost sales, and profit erosion, but you didn't make a major change because you didn't have to. With the pandemic accelerating all these trends, we find ourselves, yes, at this "pivotal" moment.
For some in retail, this has meant that you increase resources for your digital platform, decide to permanently close underperforming stores, or rationalize products and categories where previous incremental and cosmetic changes made little difference. Either way, if you want to make a pivot, you need to identify what wasn't working before all the bad things happened. Consider these your low hanging fruit and step one of making meaningful change.
What is the consumer telling you?
We've said it before, and we'll say it again. If you want to know which direction to pivot, you ought to be talking to people, both your customer and non-customer. Some questions to consider:
Which platform, apps, and social networks are they most engaged with and why?
What causes are near and dear to their hearts?
How do they prefer to connect with your brand?
In what ways do digital and physical channels each work (and not work) for them?
Sure, all of these things add up to things to improve, but they can also shed light on wholly new directions and approaches to doing business.
Take TikTok, for instance. It is now a household name, in no small part because of its sky-rocketing usage during quarantine, but there was a time, not long ago at all, when brands weren't sure how to use it and if it'd get the traction they wanted amongst youthful shoppers. It's now arguably one of the most important, growing channels for "organic marketing.". Without talking to young consumers, retail marketers might have missed the opportunity this social platform creates, especially now in a time of digital connectivity.
Moral of the story: now is the time to be capturing feedback and applying the learnings.
So what can be salvaged?
A pivot doesn't necessarily mean you get rid of everything and start over. It's about saving what is working, knowing why it's working, and figuring out how to translate that success to your future business. Let's be more specific. Things central to your brand identity are probably worth holding onto. (We're a jeans company.) But areas where costs and/or risk are increasing and future returns are diminishing, is something to be wary of. (We only sell jeans in this particular channel.)
This type of assessment is why you see brands like Walmart selling off and closing down business units. For example, when it acquired Jet.com for more than $3 billion four years ago, and then shut it down this year, it might look like a big, expensive failure. But not so fast, said the company, "The acquisition of Jet.com nearly four years ago was critical to accelerating our omni strategy." In Walmart's case, they might not have salvaged the name of Jet.com, but they did take what it needed from Jet's business and apply them to its growing omnichannel business.
Let's be clear about one thing, and that is the fact that there are plenty of excuses as to why brands don't make the necessary pivots, including, "We've always done it this way." Or, "We don't have that internal capability." Bringing in fresh talent, partnering with other companies, and looking to other industries as to how they've navigated change are all instrumental in making a successful pivot.
Do lots of testing
So you have a hunch about where things might be heading and how you as a brand would like to intersect with that. Great. Now's the time, after gathering consumer feedback, to bring this idea to life. We've talked about MVPs before, and they're particularly relevant here. (MVPs are minimally viable products, an imperfect but usable product or service that is going to be refined and developed as we gain customer feedback around what does and doesn’t work for them.)
What makes for an effective testing strategy? Clear ownership and team structure for the new product, documentation of the process, repeated testing and feedback loops, management stakeholdership and visibility into the process, and a focus on efficiency of time and resources, are all elements of this.
You'll learn a lot along the way, your core idea might even shift during the process, and you'll get stuff wrong. All of that's ok. This is why we test.
What's your data?
Speaking of testing, how will you design your pivot for utmost success? You can do this by selecting some key metrics that will guide your process. For many brands it will be financial metrics like revenues, margins, or cost savings. For others it will be NPS (Net Promoter Scores), or a changing ratio of new-to-repeat customers. There's also a good chance you'll need to identify new data sources that aren't internal in order to measure and set these goals, for example, what's happening in the competitive market. Take the time to set out the goals and the respective data sources at the beginning of the pivot process, so that the entire team is on the same page.
And then go further
Winning organizations not only set goals, they set audacious ones. Many companies from Amazon to Nike have built cultures where people are pushed to reach goals, goals that seem impossible to achieve at times, but that ultimately show what teams are capable of achieving when pushed outside their comfort zones.
Pivots are hard. It's true. But as one wise man said, “Change is inevitable. Growth is optional.”