How do you measure the impact of a pivot?

1 What is a pivot?

A pivot is a strategic change in one or more aspects of your startup's business model, value proposition, product, or target market. It is not a random or desperate move, but rather a deliberate and validated experiment based on learning from your previous iterations, which can be minor or major depending on the degree of change and the risk involved. For instance, you could zoom in or out to focus on a specific feature or segment of your product, switch to a different customer segment with a better fit for your product or problem, solve a different or related problem for existing customers, change the way you deliver your product or service from web to mobile, switch your revenue model from subscription to advertising, change how you reach and communicate with customers from online to offline, or even alter the core technology used to create your product from artificial intelligence to blockchain.

2 Why measure the impact of a pivot?

Measuring the impact of a pivot is essential for several reasons. First, it helps you validate or invalidate your hypotheses and assumptions about your new direction. You want to know if your pivot is solving a real problem, creating value, and achieving product-market fit. Second, it helps you track and improve your key performance indicators (KPIs) and goals. You want to know if your pivot is increasing your traction, growth, and revenue. Third, it helps you communicate and justify your pivot to your stakeholders, such as investors, partners, and employees. You want to show them that your pivot is based on evidence, not guesses, and that it is leading to positive outcomes.

3 How to measure the impact of a pivot?

When attempting to measure the impact of a pivot, there is no one-size-fits-all approach. However, some general steps can be followed. First, you should articulate what aspect of your startup is changing and why, as well as what you expect to achieve. Write down your hypotheses and assumptions about your new direction and how you will test them. Next, select the most relevant metrics to help you measure the impact of your pivot. These could be quantitative or qualitative depending on your goals and data sources. Examples of metrics include customer acquisition, customer engagement, customer satisfaction, customer feedback, revenue, costs and growth. Then use various tools and methods to gather and process your data such as surveys, interviews, analytics, experiments or benchmarks. Compare your data before and after the pivot as well as with competitors or industry standards. Look for patterns in the data that can support or challenge your hypotheses and assumptions. Finally evaluate the impact of the pivot on metrics, goals and assumptions; ask yourself if it is solving a real problem and creating value for customers, increasing traction growth and revenue; whether it is feasible scalable and sustainable; what are the strengths weaknesses opportunities threats risks and uncertainties of the pivot? Depending on your evaluation decide whether to persevere pivot again or stop; if pivoting again repeat the steps above with new direction; if stopping learn from failures and move on to new opportunity.

4 Tips and tools for measuring the impact of a pivot

Measuring the impact of a pivot effectively requires clarity, agility, objectivity, customer-centricity, and collaboration. Be clear and specific when defining your pivot, metrics, and goals. Utilize SMART criteria to set your goals and metrics. Adopt a lean and agile mindset and methodology to measure the impact of your pivot. Experiment with different versions or features of your product or service and measure the results. Avoid confirmation bias or vanity metrics that can skew your perception or interpretation of your data. Focus on your customers' needs, wants, and preferences. Involve your team and stakeholders in your pivot and measurement process. Share your vision, hypotheses, assumptions, and goals with them. Utilize tools such as Lean Canvas, Business Model Canvas, Value Proposition Canvas, customer interviews, surveys, user testing, or personas to collect and analyze customer data. Also use dashboards, reports, or presentations to communicate and visualize data. Be honest and transparent about your results and challenges to ensure success in measuring the impact of a pivot.

5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?