Entrepreneur By Duncan Robins
Covid-19 created a global health and economic earthquake, the aftershocks from which will be felt for years to come. The world (including your market, customers and vendors) is different now than it was before, and it will never be the same again. So, how can you rebuild and grow in this new era?
Where there is turmoil, there is opportunity
Entrepreneurs will see opportunities all around them:
1) Gaining market share is cheaper and faster in turbulent markets. Old barriers to new customers like habits and loyalties are disrupted. Acquisition costs also plummet.
2) Pivoting is easier (or required) in challenging markets. Difficult times require difficult decisions, but they also remove the inertia that can block much-needed change.
3) Examining expenses is more focused. Shedding underperforming assets, renegotiating restrictive agreements, breaking painful contracts and leases are also more possible in down markets.
With increased turmoil comes increased risks
To mitigate the risks and maximize the potential returns from investments, entrepreneurs should follow three simple steps:
1) Research inquisitively: Ask a lot of questions and be open to new insights. Try to look at everything with a fresh perspective. Values and valuations have changed significantly.
2) Plan deliberately: It is not in our nature to plan. Entrepreneurs like to follow their gut. But this would be a good time to outline your next steps, budgets and timelines.
3) Execute ruthlessly: When opportunities match your plan, pounce, but stay within your budget. The economics of supply and demand are on your side.
Build a new business for a new world
Don’t rebuild the same house on the same flood plain. We all need to realize that the pandemic caused a tectonic shift that will transform economies, markets, communities and values forever. We were already experiencing significant changes brought on by major and unstoppable forces including:
1) The accelerating pace of technological advancement and adoption.
2) The huge demographic shift as Boomers give way to Millennials.
3) The exponential growth in accumulated and accessible data and knowledge.
These forces were pushing changes on a global scale. Covid-19 just added an additional, massive jolt.
Find a way to meet the needs of a changed market
Many people will be craving products and services that address:
1) Core needs and services: We can expect that the demand for healthy food and lifestyles, and the desire for more comfort and security to increase. We will also see heightened interest in belonging to supportive groups and in supporting worthy causes.
2) Convenience: Personal time will increase in value. Online shopping with be a time saver. But also expect that working from home and telecommuting will become normal pushed by both employers and workers.
3) Community: Shared experiences and the memories they create will be coveted far more than material goods. Consumers will tie their loyalty to products and brands that are part of important events the related memories.
Make sure to invest in efforts that add and retain valuable customers
There are many ways to grow during this era. Here are a few strategies:
1) Launch or upgrade your ecommerce capabilities: Yes your website, but also in the promotion of your site and products or services with ‘paid media’. And consider Amazon, if you haven’t already.
2) Consider how to use freelancers for as many functions as possible: Technology is changing too quickly for your staff to possess all of the expertise required to compete.
3) If you sell products, tie them to experiences as much as possible: Organize or promote events and meet-ups that highlight your products. Help your customers develop cherished memories.
4) Help your customers find ‘their people’ with your product or service: Help them build a community that they can belong to, with a cause that they care about.
5) Embrace digital and virtual technologies. Use social media, blogs, webinars and scheduling software to support your offerings, but cut the fluff. That won’t fly anymore.
Business models will need to change. Getting back to the basics of building genuine trust, loyalty, and community will be rewarded. Technology should be deployed to help make your business remains relevant, responsive and resilient.
This article first appeared in Entrepreneur.