Pivoting For Prosperity and Profit

screen-shot-2014-06-02-at-11-20-04-amSilicon Valley is one of my favorite shows on TV, right behind Halt and Catch Fire. It’s good to see the tech sector getting some exposure in episodic TV outside of the abysmal farce that is the Big Bang Theory.  Given the impact that the tech world has on our daily lives, I’m glad to see some exposure thrown our way.

Today’s lesson is the Pivot. In the final episode of Silicon Valley, prior to possibly the best dick joke ever told, there is a discussion around the need for the fledgling startup to “Pivot” when they see that the evil empire Hooli  (aka Google) has cloned their core tech and brought it to market with multiple integration points that the struggling small startup team could never begin to achieve. The discussion of their need to pivot begins (the video is worth watching, yet youtube wouldn’t let me embed it), and hilarity ensues. Now I’m sure this is exactly how it went down at Facebook, Twitter, Youtube and others.

anatomotor-traction_mediumObtaining and keeping traction in the marketplace as a new company is difficult to say the least. There will be road bumps, false starts, and many periods where there can be a great step forward that results in three or even four steps backwards. Frustration then follows and there will be a natural desire to step back and re-evaluate the direction of the company/product, ie: the time to pivot.

In other cases, the pivot comes after a failed marketing effort or push. We see this often when a new slogan or campaign is tested and fails. In my view the success of the pivot will depend on if its genuine, and keeps in line with the core vision of the original product/platform. Example, when Youtube pivoted from a video dating site to a simple video delivery site, this was a simple change in target audience, but not an overall change in the core vision or capabilities.

new_shimmerRecently I’ve seen a few companies attempt to pivot where it has not been successful (at least in my view). Reinvention can have its drawbacks, especially if its over used. Starting out as an Apple, then becoming and Orange, and then a Banana may work, since its still all fruit. Moving from an Apple, to Desert Topping, to Floor Wax is probably a recipe for failure (but most certainly a win for hilarity).

Going further, the decision when to pivot plays a big part in its success as well as the number of times a pivot can take place. I tend to take the view that if the pivot is done very early in the companies existence that the success rate will be much higher.

To be clear, lets not equate product “strategery” with a full change of corporate direction. The need to redirect marketing efforts or re-brand strategerya product should not be viewed in the same light of a strategic pivot. The common perception is that if a young company is having difficulty generating and maintaining sales after a failed go to market launch, they may see a shift in message as a possible action that can change their fortunes. This insant necessarily pushing the panic button, but if done repeatedly it’s a sign of an organization that is struggling. Constant reinvention, re-branding, re-engagement will be noticed. I’ve seen a few companies that have tried unsuccessfully to co-opt hot trends in order to drive traffic and interest, yet when the desired result hasn’t been achieved, they have moved on to the next hot topic and it smells of desperation instead of a well thought out strategy and vision. Depending on their life cycle phase and burn rate, the frequency in which throwing anything against the wall to see if it sticks should be seen as a sign that a company is in free fall or, that full panic of the management class has taken effect.

Anyway, this is just today’s barrage of random musings that were floating around in the ol noggin. I’m pretty sure I have no idea what I’m talking about. That said, have a great weekend, and swing by next Saturday for SNLDD#7, Jumping Ship. I’ve had several guests who wanted to be part of that episode and vacation schedules have precluded us all from being on at the same time. I think this is going to be a pretty amazing episode. Stay tuned.

 

 

Leave a Reply