According to one estimate, as many as 20 per cent of businesses have undergone a significant transformation as they have grown. Whether your business is looking to pivot or not, there are important lessons to be learnt from this trend.
1. Listen to your customers
No matter what kind of product or service you’re running you need to know what your customers think of it. Photo sharing service Flickr started life as an online roleplaying game, but they realised that the most popular part of their offering was the small photo sharing element. When it came to looking at pivoting, it was clear to the team what direction the product should be going in as they knew what their users liked.
“It turned out the fun was in the photo sharing,” Caterina Fake, co-founder of Flickr, said in a 2006 interview with USA Today. “Had we sat down and said, ‘Let's start a photo application,’ we would have failed. We would have done all this research and done all the wrong things.”
2. Take inspiration from everything
Had Howard Schultz not travelled to Italy in 1983, your morning coffee could look very different. The Starbucks CEO was inspired by the European coffee shops that he visited to change the direction of the business.
"I saw something in Italy which was the genesis of it all,” Schultz said in a 2013 interview with ABC CBN. “What I saw was people coming together and human connection over coffee and it was the romance of the beverage that was the genesis of the idea.”
In the same way, entrepreneurs should always be aware of what they're seeing and experiencing and consider how it could affect their business.
3. Think outside the box
Nintendo might now be synonymous with video games but the company’s roots are actually in trading cards. Between the years of 1889 and 1956, the company exclusively created playing cards. It wasn’t until they found themselves struggling to survive in the Japanese toy market in 1966 that the company developed its first product, an extending arm released as the ‘Ultra Hand’ in time for the Christmas rush. It sold over a million units.
However, the story goes that this toy would never have been created had it not been for maintenance engineer Gunpei Yokoi who was responsible for fixing conveyor belts at the factory. He developed the product for his own entertainment. However, spotting it in the factory was potentially the best move Hiroshi Yamauchi, president of Nintendo at the time, made as Yokoi went on to create the Gameboy – one of Nintendo’s most popular products of all time.
4. Stay ahead of the game
Android started its life as a camera operating system that would allow users to connect their camera to their PC. However, the team quickly realised that the sharp decline in camera ownership meant that their product was heading for a niche market. As such, they decided to pivot into mobile operating systems – a market where there was and is a huge potential for growth.
“We decided digital cameras wasn't actually a big enough market,” said co-founder Andy Rubin. “I was worried about Microsoft and I was worried about Symbian, I wasn't worried about iPhone yet.”
Launching with a mobile operating system in 2005 put Android significantly ahead of their major competitor Apple, which didn’t enter the market until 2007 – which offers an explanation as to why Android enjoyed a 88 per cent market share in 2016.