How to Build a Successful Business in the Midst of a Crisis
At this point, it’s no more news that we’re in for hard times. Just on Friday, the chief of the IMF, Kristalina Georgieva told CNBC that the world was in a global recession and that only concerted efforts will save it. Coming a bit closer home, the economy is already feeling the effects of the Coronavirus.
As experts predict that it will get worse before it gets better, the question on the lips of every small business owner is, how will my business survive these trying times?
The Why
For those who have followed me and my content for a while, you’ll know that I’m a huge advocate of businesses starting with why. Quoting N.Y #1 best-selling author, Simon Sinek, People Don’t buy What you do, they buy Why you do it.
Naturally, we as customers are attracted to companies and businesses that represent particular ideals and values. Whether consciously or unconsciously, we patronize businesses that represent values that we identify with. Thus, the key to your success is the ability to articulate why you do what you do.
With money being tight and people having to prioritize what they spend on, businesses that deal with non-essential goods are going to be hardest hit. Chances are, your business does not provide an essential service (food, drugs, emergency services), so what can you do?
The Pivot
I first came across the concept of the Pivot in Eric Ries’s book, The Lean Startup. Basically, it depicts the ability to make strategic decisions to change what your company does in response to the behaviour of the market.
Listen, your business does not exist in a vacuum, and your ability to interpret the market and make strategic changes to your products, services, and goals will prove invaluable in these trying times.
Let me give an example. Apple, who is perhaps the greatest example of starting with why are able to enter and dominate multiple markets because they can interpret and respond to the market. It was said the Steve Jobs started Apple as a way to enable ordinary people to be just as powerful as corporations. There’s a famous story where Steve was faced with a decision to pivot unto a new line of products, even though they had invested billions of dollars in another direction. One of his executives reportedly said, ‘This’ll blow up our company’ to which Jobs said ‘Better we blow it up, than for someone else it blows it up for us.’
In this season of uncertainty, you’ll have to switch and make changes to the way you do business and the kind of products you produce. Don’t be like Sméagol with the ring and drag your business into the abyss by being inflexible.
But how exactly can you do this?
The How
I know you’re here looking for actionable insights, and that’s what I’ll give to you. First, you need to take a look at the market and learn from it. How are your customers feeling? What are their concerns and problems right now? Obviously, people’s priorities have changed in the past few weeks and you need to be able to anticipate it and make new strategic decisions.
If you sell fashion items, for example, running an ad for people order shoes or bags is unlikely to be productive in this period. Rather, you need to sit down and run a market analysis. What are your customers saying, and feeling? And what needs can you meet remotely?
Once you have an idea of what your market is feeling, then it’s time to go into intense testing mode. Build minimum viable versions of products that you think your users would be interested in. A minimum viable product is simply the cheapest and easiest version of your product that you can produce. A pre-order offer, for instance, is a good example of a minimum viable product.
Remember that the goal of your MVP is not to make as many sales as you can right now, but to learn what your market wants. The goal is to learn what your market wants, build it, then learn from the feedback that you receive. This is called the Build-Learn-Measure Feedback loop.
The What
Now, let’s get practical. How can you apply all that I’ve outlined here?
First off, start with why. Try articulating why you are into the line of business you are in.
For example, my personal why is to help build the businesses of the future. By having a strong why I can pivot and provide different types of products and services in a period like this.
Next, start creating content. Content is the secret to figuring out the pulse of your market. Once you know your target market, start creating content around topics that you think they’ll love and then watch the feedback you get. What posts get the most likes or comments? Which ones get the most responses? By doing that, you can identify potential problems that your business can provide solutions to.
A note of caution though, you must have and exhibit empathy in your content. People are vulnerable right now, and the associations that they make with your business will determine if they will want to patronize you in the future. Offer hope, and watch how your audience will repay you with attention.
Build alternative sources of income.
In the case that your business is struggling really bad or is your only source of income, then it might be time to enter a new business model. I wrote a post here about various business models that you can diversify into.
Case Study
Let me end this by running a quick case study of how an imaginary entrepreneur who sells fashion items can weather this storm.
First, know your customer.
The ideal customer for our study would be a Nigerian Lady, preferably with tertiary education, between the ages 20 to 26, unmarried, earns between N80,000 to N250,000 monthly and has between N5,000 to N50,000 of disposable income.
Know your Why
For our entrepreneur, her why is that she’s passionate about empowering women by giving them the confidence they need to be all that they can be.
Start your Research
According to research, her ideal customers are home alone or with their significant others. They’ve turned online to social media apps, such as TikTok, triller, as well as the popular Instagram, and Twitter.
How does She Reach Them?
She could start by creating content so as to draw their attention. The goal is to accelerate user-generated content. That is, content that customers themselves put out there. For example, we could run challenges like #HomeOfficeWednesdays, where her audience gets to dress up as they would for work, and then showcase how they work from home.
Anyhow she does it, the goal is to create content that her customers can consume, and occupy them. By doing this, she’s building positive associations to her brand such that they are more likely to patronize us.
Create Value-Added Services
The entrepreneur can also pivot and create value-added solutions that she didn’t offer before. For instance, she could organize a paid gele-tying or make-up class for her customers. Existing customers can access the class at a cheaper rate or even free while new members pay the full price.
Whatever she chooses to do, the fact that it is consistent with her why makes it a valid option that her customers can relate with. Her customers will see it not as a scheme to make money, but rather to help women, which is the entire reason she started the business anyway.
I hope that this gives you some ideas on how you can pivot in your own business. Hit me up on WhatsApp, I’ll love to hear what you can up with.
The only way we’ll get through these uncertain times is by working together, but the fact that you’re staying home does not mean that your business must die. Innovation is key in this season, and I want to help along with that process. If you need help on deciding how your business can navigate this period, you can book a free consultation with me, and let’s discuss it.
