Steve Blank in seven steps for small business recovery


What doesn't kill me makes me stronger.
Friedrich Nietzsche

The world is a different place than it was 90 days ago. Countries have traded lives saved by shutting down most of their economies. Tens of millions of people who were employed are now unemployed and worried about their future. Business owners, large and small, are struggling to find their place, wondering what the new normal will be when the recovery occurs. For the majority of companies, the economic models of the past will not return.

Small business service providers have been hit the hardest. Every day, while they were sheltering on the spot watching their bank accounts dwindle, they wondered: if I can't provide my services, what will happen to my business? The reactions fluctuated between uncertainty, fear, panic, anger and distress. But in the past month, the reaction of an increasing percentage has been resolved. Decide to leave items or services in your business that no longer work in the current environment, and make up your mind to create new ones.

Honeybook is a company that has its finger on the pulse of tens of thousands of small businesses. They provide software for freelancers and small businesses to manage customers and their business – proposals, billing, contracts, payments, project monitoring, etc.

Honeybook CEO Oz Alon was the first to find out how their members have rotated, providing their services in new and creative ways, and sharing them in special ways Rising tide on their website. Here are some examples:

Rotate in person online

  • Jill Johnson, owner of The paint mixer, offered painting evenings and creative adventures in his studio in Salt Lake City. She started offering home painting kits and organizing private parties via Zoom for team building, social hours and birthday parties. "Our customers love the experience and are very grateful to them. I receive emails and text messages every day, as well as social media posts, and it's inspiring, ”says Jill.
  • Regina, owner of Silly Sparkles, is a children's artist offering magic / puppet shows, makeup and twisted balloons at events. Since she can no longer play in person, she switched to virtual party packages with personalized entertainment for each customer. "People still have birthdays, and they always want to make them special!" Said Regina. "Virtual parties are a great way to serve these customers, and they're willing to pay for it."
  • Jordan Edelson, co-founder of Chic sketch, has reinvented its event activity as a virtual event company. His goal was to create an experience similar to their in-person events where the guests are drawn live by their team of talented illustrators. Their team now performs live sketches during virtual events on a video conferencing platform.
  • Melissa Rasmussen from Catering by chef Melissa Usually offers personalized catering with a farm-to-table approach, but in this current business climate, it has turned to offering meal kits. The menu is posted on social networks and on their website; customers pay their bills online; and meal kits are available to be picked up in their commercial kitchen or delivered for a small fee.
  • Robin Smith Florist Rhapsody in bloom began offering virtual floral design courses. She ships class supplies (including flowers and a ship) directly to participants or arranges contactless pickups. All students have exactly the same products to work with and participate in a Zoom call to attend class.

The Seven-Step Small Business Pivot Process
Honeybook CEO Oz Alon observed that there was a trend for these pivots. No matter what type of service they offered or what type of business they had, they followed the same seven steps:

  1. Create an MVP, minimum viable product or MVS, minimum viable service—Evaluate your current business model. What current capacities and services do you have? Then think about what the market needs right now and how you can adjust your services to meet those needs. What will people take from you? Create an MVP or MVS to get started.

Alexander Osterwalder co-creator of business model canvas, suggests a business model movement manual that you can do:

A shelter in place as a market opportunity
What new value propositions (products / services) can you offer to those who are stuck at home or to those who need to function with new rules of social distancing?

Resource pivots
How can you use / reuse your existing resources for new offers?

Innovation in delivery / distribution channels
Can you go digital / online, expand your reach and your potential customers?

Opportunity to buy / acquire
Are there resources (people / physical assets) that others are giving up that you can now get?

Jill Johnson, owner of The Paint Mixer, suggests taking a look at the assets you already own. "Our pivot happened fairly quickly," she says. "I knew as soon as our surrounding counties started ordering closure that the business would be in trouble if I didn't try something. After a good cry (and a glass of whiskey), I met my team to discuss short-term ideas and solutions. I looked around the studio and decided to use what we had. We offer painting parties and creative adventures. With the stock in our studios, I took pictures of what could be a "home creation kit". "

Regina, owner of Silly Sparkles, works in seconds with what you have as a starting point for minimum viable service. She says that before investing money in new equipment, it is important to be resourceful. "When you use what you have, you quickly learn what works for you and what doesn't," she says. “For my first virtual show, I only had magic accessories, green fabric for a green screen and a laptop. I didn't need to invest a lot of money in a green screen because what I had worked well. However, I needed to invest in a better microphone. "

2. Customer discovery– Although you may have been able to offer excellent viable minimum service, this is just a series of assumptions and assumptions. The next step is to validate the problem / need with customer discovery, by asking your existing customers if they would be interested in your new service. You can do a survey on social media or send an email to get an idea, then use videoconferencing to deepen your interest and your intention to buy. Jill says, "We did a gradual rollout with our mailing list to see if there was interest, and there was!"

3. Quick test—Do not spin your wheels while trying to perfect your new service. Put it in the hands of your customers as soon as possible to test the product / market adequacy. "Don't waste energy building it. Create one, take a photo, and try it with your current list. Then, when the demand is apparent, build like crazy, ”says Jill.

If you want to start testing your idea quickly, consider giving it away for free at the start. "It's easy to get overwhelmed," says Regina. "Instead of complicating the process, you just have to get started and try something!" Start by offering a free live magic show to your family and friends. You will learn so much from this test and it will give you momentum. "

4. Refine your offerAnother key element of rapid pivoting is a rapid feedback loop. Constantly ask for feedback and act on it – improve what works and adjust what doesn't. Jill says: "The first 6 weeks, I delivered each package by hand to neighboring regions. I would like to send an SMS to leave [customers] I know it was outside and I would love to have feedback. This touch allowed direct contact with each consumer. "

While customer feedback is excellent, also consider getting feedback from your peers. "Once you've just started and tried a try, it's time to learn how to improve your process," says Regina. "Send a recording of your first raw performances to other artists who have already had virtual parties. You will most likely receive insightful comments. With a few minor tweaks, you can dramatically improve your show. "

5. Market on all your channels– Share your new offer wherever your audience is, be it your website, your mailing list or on social networks. Jordan Edelson of Chic Sketch shares his new commercial offer on Instagram, leading customers to a specific landing page to find out more. The landing page also includes a Youtube video of a real live event to help potential customers see how the service works.

Remember to keep both your offer and your email simple. "Make it fun, make it accessible and make it easier for your customers to buy," advises Jill.

6. Trust proven tools—Although some parts of your business need to be changed, others may still work fine, including tools, processes and frameworks that help you manage and grow your business. Continue to rely on these elements to facilitate the business turnaround.

7. Share with the community—If your new service works, be sure to share this knowledge with your community, whether on Facebook groups or in virtual meetings. If someone else has tried something similar, you can get feedback to refine your service. If it hasn't worked, sharing with your community is still helpful, as you can exchange stories that can inspire you to take a completely different direction.

What doesn't kill me makes me stronger
A shelter in place is a mass extinction event for many industries. Not all businesses will survive. But what will emerge are the companies that have diversified their offerings, which are better positioned to resist future volatility by providing complementary channels and offers. And they're opening up new ways for service providers to adapt to more customers.

"I think our paint mixer business has changed forever," says Jill Johnson. "For the first time, we now have a service that allows us to reach a national audience far beyond our region. It will also allow us to create more classes that people can join virtually. I don't think this is a short-term solution at all, but an entirely new direction that we need to take. "

Jordan Edelson of Chic Sketch observes: “There has been a paradigm shift in consumer behavior, particularly in their adoption and emotional acceptance of virtual videoconferencing. The world changed overnight and it opened the door to our new service. "

Lessons learned

  • The Seven-Step Small Business Pivot Process
    • Create an MVP or MVS, minimum viable service
    • Make a customer discovery
    • Quickly test your idea
    • Refine your offer
    • Market on all your channels
    • Trust proven tools
    • Share with the community
  • Carpe Diem – enter the day

We will be hosting a series of 5-day hacking courses for recovery companies at Stanford this summer. If you are affiliated with Stanford, find out more or register at https://h4r.stanford.edu

Filed under: Covid-19 / Recovery |