In this crisis, the world is upside down, and adaptability is more important than ever before. SMEs and large corporations are questioning the sustainability of their business models in the face of this pandemic. The business model essentially dictate how a firm operates and makes a profit. Most business models before COVID-19 are considered flawed with consumer needs changing drastically. This development has left businesses scrambling to stay relevant in a rapidly changing market. For small businesses, in particular, apt business models are essential. The business plan for a small business follows four fundamental concepts:
- Differentiating the company from competitors through pricing or unique offerings.
- Marketing the offerings in a way that appeals to consumers and makes them want to purchase them.
- Producing and delivering products or services effectively and efficiently.
- Finally, understanding the needs of consumers by understanding their customer journey. Better the understanding of small businesses regarding customer needs, better the products, and customer experience will be.
Yet, COVID-19 has changed how each of these concepts manifests. These dire circumstances lead to businesses losing customers and profits because of rigid business models that fail to pivot to present times. If your business is also suffering during the pandemic, then it is time to pivot to more relevant strategies. After all, adaptability is the characteristic of any successful business.
So check out the best ways to pivot your business model during COVID-19.
Play to Your Core Competencies
Each business possesses skills that set them apart from the competition. These skills and resources that companies excel at are known as core competencies. If you are going to develop new pivot strategies for your business, they must be in line with your core competencies. Even though going out of your comfort zone is positive, if you are trying to survive, it’s best not to venture out too far. After all, pivoting your business model in a new direction requires playing to your strengths. Chances are the new area of interest already has real competition. So when entering this new environment, it’s best to ask yourself: “What does my business add to it?”. The answer lies in what your business does well, or your core competencies.
For example, if you run a coffee shop and need to find a new direction during COVID-19, try pursuing industries in which physical locations play a significant role. Since you already have the infrastructure, so might as well use that to your advantage. Or if you run an online book store, then COVID-19 is the perfect opportunity to leverage your digital store for essential consumer needs. That way, you won’t have to build a business plan from scratch. The lesson is, whichever direction you decide to pivot your business, make sure it plays to your strengths to drive growth.
Keep Consumer Needs at the Center
Business is all about fulfilling customer needs at a profit. This fact remains the same in all situations, even worldwide pandemics. So keep your destination insight as you make new pivot strategies for your business. The resulting business model is likely to be more sustainable as it centers on the needs of customers. The business plan developed based on sound customer needs seldom fails. So it’s a good idea to do a bit of preliminary research to understand the current customer needs.
However, in the time of COVID-19, the needs of consumers are easier to estimate. People want health, safety, and security. Trends have shown that the luxury industry is suffering, whereas essential sectors such as pharmaceuticals are flourishing. People are also less likely to come out of their homes, and online businesses are booming. All of these trends show what consumers want. Understanding consumer needs and using core competencies to fulfill them may be the way forward for small businesses.
Crucially, it could lead firms to new markets where they may flourish. The point of pivoting your business model in a time of crisis is to adapt and survive. However, once the pandemic is over, the decision to pivot could lead to long term growth. As long as customer needs remain at the center of your pivot strategies, your business will survive.
Reciprocate Loyalty to Consumers
Just because you move in a new direction, does not mean you abandon the customers that made your business what it is today. Loyalty needs to be rewarded by dependability, and pivoting your business model can help with that. However, rewarding loyalty is difficult in the middle of a pandemic. Many consumers have moved off of brand loyalty because of hard times. If businesses stop taking care of their customers and shift focus away, so will the customers. That is why it is essential to stay focused on what consumers demand. As long as you pivot your business in a way that allows you to contribute positively to society, customers will remain loyal. Helping out the community and caring for people’s needs in a time of crisis can be immensely rewarding in terms of loyalty.
Already loyal customers will be reassured that the brand they follow is worth following. New customers will be impressed by the effort to make a positive impact on society. It wouldn’t hurt either if your new strategy offered discounts and incentives to customers to purchase from you. As such, your new business plan should not only be to gain new customers but also retain old ones. The better your business services loyal customers, the easier it would be to remain relevant once you expand.
Strengthen Digital Capabilities
It is clear by now that having digital infrastructure is immensely vital for your business. As entire industries shift online, now is the time to strengthen your digital capabilities. We would suggest making digital infrastructure one of your business’s core competencies. This improvement will help to expand your business and implement pivot strategies effectively right now. When the pandemic is over, these capabilities will help you grow your business and gain new customers.
All customers want is convenience. Digital platforms are the way to provide them that. So to remain competitive and relevant in the new business model, digital capabilities are a must. Businesses have earned millions by implementing simple digital marketing techniques such as SEO for business and Facebook advertising.
Stay Compliant to Quality Standards
The last way to pivot is to remain compliant with quality standards, no matter how you pivot. This compliance means following CDC guidelines, mandating masks, practicing social distancing, and disinfecting regular contact surfaces. Another reason to comply with quality standards is to guarantee a foothold in the industry. There are countless examples of businesses that exploded into a new category without proper guidelines and failed. As such, following strict quality standards and guidelines will help you leverage your position to the max.
Besides, without proper quality standards, the customers will not be satisfied. As already mentioned, satisfying customer expectations and needs is the only reliable way to guarantee success. If the quality of your new products or service lacks because of a lack of quality standards, it represents poor business planning. That is why your pivot strategies and unique business model have to consider quality standards.