How to Pivot Your App or Business

How to Pivot Your App or Business

Tamar Barlev

August 11, 2021 · 6 minutes

“How to Pivot”—what a (slightly, possibly) intimidating thing to Google. Because you’ve built a thing, and it’s your baby—but for some reason, it’s not gaining the traction you expected.

Well, as SVB puts it, “In Silicon Valley, a pivot almost seems like a rite of passage.”  

So you’re not alone in rethinking things, and the fact that you already are is a step in the right direction. But how do you do it? Well, that’s why Goji Labs is here. Read on. 


What is a Pivot?

In a previous Goji Blog, we summarized an academic study on the theory behind pivoting and its practical applications. However, as a recap, a pivot is basically a fundamental change in the direction of your business upon the realization that your app or product doesn’t necessarily have the right market fit. 

You’ve learned something so significant about your customer, product, or need that a substantial change is due. 

The Goal of A Pivot

Can be summed up in a few words: you’re looking to increase revenue and survive in the competitive landscape. Boom. 


Types of Pivot

There are many ways to pivot, but they can be divided into three main categories. 

The Product Pivot 

– i.e., through meticulously tracking user data, you’ve realized one of your features is stickier than the rest, or vice versa. Or perhaps you realize the product has too many features (yes, it’s possible,) and it’s overwhelming your users. Or several other situations. So it’s time for a:

  1. Zoom-in Pivot, where you make one of your features the main product. 
  2. Zoom-out Pivot, in which you actually make your whole product a part of a suite of products
  3. Business Architecture Pivot, in which you change your business model. You can either be low-volume, high-margin, or high-margin, low-volume. Don’t get smart and try to do both. This isn’t a “both” situation. 
  4. Engine of Growth Pivot, which basically tackles how you gain traction. It’s widely accepted there are a few kinds of “engines” in this context. One of them is “viral”—i.e., “I’d Cap That,” circa 2012, which you showed it to your friends, and they sent it to theirs. Another is “sticky,” in which your user retention is through the roof and churn is low. And lastly, there’s “paid growth,” which means you invest in marketing strategy for customer acquisition. Of course, all three are perfectly legit–but sometimes, it’s a good idea to switch them up. 
  5. Technological Pivot, or basically, you realize there’s a more cost-effective way to build and maintain your product.


The Customer Pivot

A customer pivot is when you realize there’s a customer segment with higher-value, more motivated customers. If you build with a broad and unspecific customer base in mind, you run the risk of not appealing to anyone. Or, if your Ideal Customer Profile is off, you may be targeting the wrong or lower-paying crowd. 

  1. Customer Segment Pivot, which is exactly as it sounds—shifting your target audience from one to another due to volume, lifetime value, or accessibility. 
  2. Value-Capture Pivot is when the solution is inherently valuable. However, it’s too pricey, or its business model isn’t tailored to your target audience correctly. A shift in the revenue model might just open that door up to new opportunities.
  3. Channel Pivot, or changing the way to get your product to your customers. If the reseller market isn’t working for you, try a direct sales model.

 

The Problem Pivot

This pivot shows exactly why customer interaction and feedback are so important. You had a hypothesis, made assumptions, and tested those market need assumptions thoroughly through market research. However, perhaps your testing was too local or too broad? Either way, you realized that your target market has more burning needs than those your solution addresses. Well, now’s your chance. 

  1. Platform Pivot, or how you deliver your solution. It could be an app, sure. But also web-app? Software? Think about it. 
  2. Customer Need Pivot, i.e., that situation mentioned above. Your target audience has bigger fish to fry and spend on. What do you do? Ya pivot!


How to Pivot

Alrighty, enough with the background information. Let’s get to the meat of it. 


Questions to Ask

First off, let’s establish some basic questions you should ask yourself before starting this whole hoopla.

Product Pivot

  1. Is my product being delivered in the most efficient, customer-tailored way?
  2. Are some or is one of my features gaining the most traction?
  3. Is my product built in the most efficient and cost-effective way?

Customer Pivot

  1. Who are my highest lifetime value customers, and why do they use my product?
  2. Is there a segment that might also benefit from my product that isn’t using it right now? If so, who are they, and what’s their lifetime value?

Problem Pivot

  1. Is the problem I’m solving actually a thing? Are people really out there thinking (and willing to pay) for an app that’ll teach their goldish how to synchronize swim?
  2. What other problems are my customers dealing with?


Coming to Terms with Change

In the study we summarized in “What is Pivoting and When to Pivot,” we mentioned there seemed to be somewhat of a confirmation bias thing going on with founders. So often, we reject evidence that contradicts our current beliefs.

Why? Because we often naturally resist change, don’t like uncertainty, and don’t like feeling doubt in our long-held beliefs. That’s *okay*. However, this tendency will probably not do you any favors in the long run in business (and likely, personally—but we won’t go there.)

 

Strategize and Align Goals with Business

Now that you’ve accepted that there’s a need for change, it’s time to ask why. Where is the original idea or product failing? We’ve gone through the different types of pivoting you can do, so evaluate your weak points through those lenses and see what fits you best. 

Once you’ve done that, it’s time to develop a strategic plan that aligns with your business goals. Maybe the goldfish synchronized swimming app wasn’t it. Why wasn’t it catching on fire like you thought it would? Business model? Ineffective marketing channels? Lack of need?

Understand Your Target Audience

Start at the source: your target audience. For example, are people really so obsessed with training their goldfish? Maybe more in-depth fish enthusiasts have different kinds of fish? Or perhaps this app would be more relevant for, you know, owners of mammals that have more than a 3-second memory?

So, audit your previous market research. Therefore, you can better understand customer need, willingness to spend, and which segment might resonate with your product better. Or whether you want to address a different need entirely.

The important thing is to know your target audience better than you know yourself. Which sounds dramatic. But it’s not wrong. 

Resources like Google Analytics, keyword and related search terms, PewInternet, and SurveyMonkey could help.

Pivot Towards Opportunities of Growth

Pivoting for the general sake of change could be a waste of resources. So you should go towards concrete evidence of growth opportunities. Will there be a boom in the market for parrot speech apps soon? How do those keyword search numbers looking?

Competitive Analysis

What are your competitors or alternative incumbent solutions doing things, and how well are they doing them? What are their metrics? And how can you improve upon how and what they’re offering?


User Testing and Feedback

We will always come back to this one. This piece is so important because you have to know to whom you’re selling. Test your product on a limited and then larger pool of users. Are they using a specific feature substantially more than any other? At what point of the workflow are you experiencing the most churn? Do they think the product is too expensive, or do they not like its subscription model?

You can find those answers by embedding surveys in the product with qualifying questions to learn more about their demographics and relate them to your user analytics. Even better—offer gift cards to those who grant you a five-minute interview. 

As always, it’s essential to base all of your decisions on data—not assumptions. 


Develop a Prototype and MVP

In the case you’ve decided on a product pivot, it’s time to build and test a minimum viable product. Of course, this is once you’ve created a comprehensive product roadmap and strategic plan based on data. 

However, not all may be lost. You’ve already sunk resources into your previous product, and you can likely use some, if not most, of it. So, try not to waste the work you’ve already done. Instead, think of how you can use what you already built because you did work very hard on it, and so did your team. So if it’s possible to salvage some of it, do so. It’ll be a great way to make the pivot more cost-effective.

After you build your MVP, run comprehensive user and usability testing—just as you did the first time. Observe how they use the app independently, and give them pre-determined tasks to complete to see roadblocks or uncover desire paths. Questionnaires, surveys, interviews are all critical here. 


Get Everyone On Board

Team morale is a big one. Explain to your team the need for the change, the strategy for the change, and the evidence behind it. And most of all, emphasize the growth opportunities. Get them excited! Because likely, they’ll have to work hard and invest in the pivot, and they might also have to redo work they’ve already done. But if you approach it with excitement and enthusiasm, they’ll be stoked to work towards your collective goals. 

You’ll also want to do this with investors and relevant stakeholders—this isn’t the time to hijack the operation without prior notice and approval. You want to keep those relationships healthy and transparent. So give them plenty of heads-up, give them the space to give feedback, and take it heavily into consideration.

 

Lastly, it could be beneficial to consult product strategy experts who’ll help you put the theory to the rubber.

Coincidentally, hi, we’re Goji Labs—a product and software development consultancy with experience in designing, “rescuing,” and deploying hundreds of products

Looking to develop a new app or revamp an existing one? 

Have any general questions about who we are and our authority on the subject? 

Reach us at GojiLabs.com.

 

                 – Goji Labs

About Tamar Barlev

Content Writer based in San Francisco. Passionate about the written word, indie-electronica, and baking.

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