One of the things that separates entrepreneurs from everyone else is their indomitable sense of optimism about their products or services.
They have the confidence that consumers will embrace what they are selling.
But what happens when things don’t go as expected? What should entrepreneurs do when their products or services don’t resonate? For many companies, it’s a death sentence because no sales means no more company and there is often no way out.
But some entrepreneurs won’t go down without a fight. Rather than throw in the towel, they reload with new or different products or services.
A change in direction is described as “pivoting” the business model. It can be a radical and risky decision because there is no guarantee the new direction will work any better than the old one. But many companies have no choice because the alternative is not being in business for much longer.
A good example of a company that pivoted its business model to find more success is PlanetEye, an online travel start-up where I worked for 18 months until December, 2008.
PlanetEye’s original plan was the business-to-consumer market with a service that provided customers with a compelling place to discover photographs, articles and information about hotels, restaurants and attractions for destinations around the world.
The service was beautiful, feature-rich (including cool interactive mapping technology) and it had content and information that should have differentiated it. But the online travel market is extremely competitive, which makes it a challenge to attract users and establish a foothold.
With its business-to-consumer model failing to thrive, PlanetEye decided to reload strategically by focusing more of its efforts on the business-to-business market by providing technology, content and consulting to other companies in the travel and hospitality industry.
It is left to be seen if PlanetEye’s new strategy will be successful but the decision to pivot the business model was a strategic necessity. A pivot is not easy to pull off but if a company is flexible and willing to embrace change, a pivot has the potential to lead it in an exciting new direction.
Special to The Globe and Mail
Mark Evans is a principal with ME Consulting , a content and social media strategic and tactical consultancy that creates and delivers ‘stories’ for companies looking to capture the attention of customers, bloggers, the media, business partners, employees and investors. Mark has worked with three start-ups – Blanketware, b5Media and PlanetEye – so he understands how they operate and what they need to do to be successful. He was a technology reporter for more than a decade with The Globe and Mail, Bloomberg News and the Financial Post. Mark is also one of the co-organizers of the mesh, meshUniversity and meshmarketing conferences.