These Are the Core Elements Needed to Successfully Pivot Your Business

Pivoting successfully relies on seeing that the business has a problem and addressing it head-on.

The World Bank says that the global economy may be facing its most massive contraction since the Second World War. The massive amount of job cuts in line with the slowing of the US economy has made one fact obvious. Businesses facing this dire situation have had to adapt or face their demise.

Companies looking at changing their models to adapt to the crisis have been using the term “pivoting” extensively. We already know that a pivot is a hinge point that allows you to exert less force to move a heavy object. Inc. notes that, in business, it’s a point that a company can leverage to grow itself and explore a new market related to its core product. In essence, it allows a business to develop laterally in the market. Several well-known enterprises have successfully pivoted during the pandemic, demonstrating that it can be done quite successfully once a company has a plan. Extending a business’s capabilities with the aim of long-term profitability and sustainability is what has driven so many enterprises to consider pivoting into related markets.

Enterprises pivoting to adapt

Pivoting successfully relies on seeing that the business has a problem and addressing it head-on. Believe in Banking mentions that Spotify changed its business model from being a music provider to being a tastemaker and podcast distributor. Initially, Spotify’s business model depended heavily on free users listening to ads. However, as the pandemic worsened, businesses had less income to devote to an ad budget. As a result, companies like Spotify that relied on that revenue were left out in the cold.

Instead of fighting for an ever-decreasing portion of the ad revenue pie, they decided to shift their focus. The company already had an audio distribution platform. Now it was time to monetize those free users by building original content. In a move that mirrored Netflix a few years ago, Spotify started buying up the sole rights to popular podcasts and drawing in users because of this exclusive content. In effect, the company found it’s pivot and shifted gears, without even needing to rethink its business strategy extensively.

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