This article has been contributed by Aneesh Khanna, Early-Stage Entrepreneurship Consultant & Coach.
In 2010 – It was DIFFICULT to STARTUP
In 2024 – It is DIFFICULT to ‘NOT STARTUP’
This makes it even more important to be able to ‘Validate your Idea’ before you kickstart your journey. Idea Validation is both an INTERNAL and EXTERNAL journey.
I have an 8-step framework which I use for ‘Idea Validation’ with aspiring Entrepreneurs, but let’s take an example and make this learning more fun. Recently, I conducted a bootcamp on Entrepreneurship for children in their 10 th Grade at a Business School in Bandra Kurla Complex. At the end of the very enjoyable session, a 15-year-old, gentle, bespectacled girl came up to me with her IDEA. She said softly but very clearly “Sir, My father is a football coach, and I want to do something in the area of football coaching for girls. But I want this to make money and for it to be a career”. Unfortunately, the kids were ushered to the bus and our conversation was cut short. I have often thought of her and her IDEA over the last couple of weeks. So, I thought let’s use this opportunity and think about the 8 Step process for ‘Football Coaching for Girls’ as an Idea to Validate.
This is a critical step, since we can get lost into the solution. Take a step back and articulate the problem in one sentence. So, for our idea, let me define the problem statement, “Increasingly children are getting addicted to devices and have lost the ability to engage in outdoor sports, which are critical for child development, confidence building, team work and physical health. Coaching, training and play facilities are skewed towards coaching more boys than girls, particularly for physical sports like football, cricket, athletics, hockey etc”.
Are you a Painkiller?
Speak to at least 25-30 people who have this specific pain on account of this problem. You want to be a Painkiller and not a Vitamin C tablet. 15-year-olds are very smart, they can create a simple questionnaire in Microsoft word and get 30 copies printed.
They can go along with their parents to the mall, the beach, a playground, or a walking stretch, where there are parents in the age range of 32-50 years and request them to fill this questionnaire. A google form also works ��. Some question examples:
For how many hours in a week, do your children play in the outdoors?
Do you believe that the lack of outdoor activity hampers their overall growth?
Would you encourage your girl child to spend time out of her other activities, specifically for sports coaching?
How much would you be willing to pay for 1 hour of football coaching time?
TAM
The Total Addressable Market – How big is the market. How to calculate the TAM? So there are 2 ways to calculate the TAM or the overall size of the market:
Top Down Approach – We start with some available secondary data on the Industry and then filter it down to arrive at the appropriate market size.
Bottom up Approach – Number of potential girls who are in the age group of 6-20 years multiplied with the price of the coaching for a year. Sometimes, even if the TAM is small, don’t worry about it, build such a wonderful Coaching experience (online and offline), that it creates tremendous ‘Customer Love’. This Customer Love will replicate over time and increase the TAM. Tomorrow we could look at hockey, cricket, track and field. Move out of just pre-teens and teens and look at early office goers in 21-28 years age bracket, who have no time to play at all.
Competition Analysis
A 2X2 competition matrix is a reflection of the Industry, in which you want to build your Idea. It literally shows you the white spaces where no brand is present. The choice of the x and y axis variables are very critical, because they showcase the different types of companies in the industry. For the sake of our Idea, I chose the x axis to understand if the coaching is focussed on girls or Unisex(polite way of saying more boys). On the y axis I chose Apps/Academies Versus stand along coaches who list themselves on Just Dial.
Competitive Analysis
Clarity on the Solution
Focus on only those features that solve a problem. Great products are built after many layers of iterations, based on customer feedback. Think about, if you should focus on individual coaching? Is this going to be a more Summer focussed or weekend activity? How to combine offline coaching, with online or community experience? Can we think of existing models like ‘Sisters in Sweat’ and learn from them.
Can we screen the English Premier League for our users?
Product Channel Fit
Is as important as Product Market Fit.
B2B – Should we look at tying up with schools which have a playground and allocate a full-time football coach.
D2C – Build beautiful content on Instagram & facebook and create a frictionless landing page, to get people to sign up for existing groups, which meet on weekends
In the day and age that we are today, understanding your Unit Economics and Unit Level profitability is paramount.
Price – What will be the willingness to pay for 3 hours of coaching a week? For the summer program? For women in 21-28 years? Look at your questionnaire for some answers. Also look at the existing pricing as an indication
Fixed Costs – Looks like the cost of the Coach is going to be a larger cost centre. How can there be a continuous availability of this talent
Variable Costs – Cost of football gear
Frugal Bootstrapping
There is a lot of merit hustling in the early days of bootstrapping.
Grants – If you are a young woman entrepreneur, there are grants available to help you get off the ground. Look up the state chapters under Startup India portal, E.g Women Entrepreneur focussed incubator WISE by SNDT Women’s University.
Customer Money – Start small, chase small wins, get one school to back you up, get some customer money, show some Product Market Fit, and then you can get external money to scale your business.
When you go through these steps, you will find answers, which in turn will create an internal and external Idea Validation.
In the world of entrepreneurship, pivoting means fundamentally changing the direction of the business when the existing products or services are not meeting market needs. A pivot is usually employed to assist a company in improving its revenue or even continue its survival within the market. The way in which a company pivots makes a difference in its perception.
While pivoting means a change or shift to a new strategy, it doesn’t always entail a drastic overhaul. More often than not, it is only one problem that needs focus and may require a change. Some of the changes within a company that could be considered a pivot are:
Simplifying or streamlining a product by removing complex features.
A simple product turned into a feature or as a part of another product.
Shifting company market position and target customer.
Employing a new revenue model to increase monetization.
Major Challenges Faced by Startups in India (2021)
A pivot is a move of last resort and must be considered only when every other avenue has been exhausted. There are some signs within the operations of a company that can help an entrepreneur identify the right time for a pivot from the main idea.
Consistent Under-Performance Compared to Competition
The world of business is extremely competitive and the company is unable to corner a considerable market for itself due to other heavy-weights who have captured the market with similar products of better quality and lesser price.
Limited Response from Market
Low customer traction to the launch of the product or service is usually an indication that the market is unwilling to either accept the product or unwilling to pay the price. While it is possible to generate a buzz with marketing and PR it doesn’t necessarily translate into sales. This is a sign that it is time to either make significant changes to the offering or change the offering itself.
A Single Feature or Product Gets Traction
If there is only one aspect, feature, or product of the company that is working and gaining traction while the others are stagnant or slow-moving, it might be time to pivot and capitalize on what is working. It can also mean radically changing or completely ditching what is not working well.
Company Has Hit a Plateau
An unmotivated team or an inefficient strategy can easily lull a company to hit a plateau. At this stage, a pivot must be considered. It need not be a radical change, however, an objective analysis can identify areas where a shift is needed.
Financial Instability
Businesses need capital to run and startups are especially vulnerable where funds are concerned. If the company’s finances are under stress, it is time to step back and consider a pivot of product or service that may be financially more viable. The aspects of business that need serious consideration are:
What are the particular aspects that are putting stress on the finance?
Which areas require trimming?
What is the future path with the resources left to utilize?
Effective Pivoting
Distributions of Startups in India by Sector (2020)
There are numerous considerations that lead to a successful pivot:
Align Business Goals With Business Operations
Building and running a successful business is an endeavour that is long and challenging. Hence, it is necessary that the envisioned business goals align with the operations and functioning of the company. A pivot requires a mental reset of new goals that align with business operations.
“Less is More” Approach
Pivoting is all about simplifying the product or service in a way that resonates with the end customer. The more features that are introduced, the more it will confuse the target audience. Instead, focus on one feature that is causing the issue and resolve it through simplification.
Understanding Target Audience and Listening to End Customers
If the product functions well and is simple to understand and use, then the issue could simply be the wrong target audience. In such a scenario, the pivot might only be the target audience and the marketing strategy and not necessarily the product itself. However, if there is consistent feedback on the price of the product or the complexity of its use, the company might be ripe for a pivot on the product itself.
Redirecting Current Resources
It is important to recognise the work and resources that can be salvaged and reused in the new direction. This saves repetitive work since a lot of groundwork may already be done and information readily available.
Ensure Pivot represents Growth Opportunities
A pivot that is considered thoughtlessly and without due consideration might prove disastrous for the company’s future. As mentioned earlier, a pivot is a move of last resort and should not be undertaken lightly. If considered, future growth opportunities must be taken into account so as to ascertain a successful pivot.
Companies That Pivoted Successfully
These are some examples of companies that pivoted in their early days and found phenomenal success:
Myntra
Established in 2007 by Mukesh Bansal, Ashutosh Lawania, and Vineet Saxena and headquartered in Bangalore, Myntra began operations selling on-demand personalized gift items. It operated primarily as a B2B business model in its initial years. However, the growing popularity of eCommerce retail after 2011 forced the fashion brand to pivot. It moved away from gift personalization and began selling fashion and lifestyle products. By 2014, Flipkart acquired Myntra, but it continues to operate as a standalone brand. Myntra has found tremendous success and popularity with its loyal customer base.
Instagram
It was actually initially launched as Burbn, a mobile check-in app that was developed by Kevin Systrom and Mike Krieger. What the developers realised was that the photo-sharing feature of their app gained immense popularity among their users. This caused a pivot from their original product, Burbn, and the developers refocused their app on one prominent and popular feature, photo-sharing. They named it Instagram, and the rest is history.
redBus
This bus ticketing service app’s initial business model, when it launched in 2006, was to sell bus booking software to bus operators. However, they had an existing way of doing things and no real need to change it. The app makers quickly realized that the customer pain points were stronger and would eventually drive the change. They quickly pivoted their entire business model to become India’s largest bus ticketing platform, bringing convenience and ease of booking tickets to all those who travel via bus. redBus is part of India’s leading online travel company, MakeMyTrip Ltd.
Conclusion
There are numerous such case studies of companies that originally began with one idea and pivoted within a short time to find tremendous success. Having said that, a pivot is not a magical pill that suddenly takes away all troubles. It is a considered business move that requires critical and analytical skills as well as a sound pivot plan to ensure that the change brings success.
FAQs
How do you know if your startup needs to pivot?
You can tell if your startup needs to pivot from the following signs:
Consistent Under-Performance Compared to Competition
Limited Response from Market
Only a Single Feature or Product Gets Traction
Company Has Hit a Plateau
Financial Instability
How to effectively pivot from your main idea?
The following considerations will help you effectively pivot from your main idea:
Align Business Goals With Business Operations
Redirecting Current Resources
“Less is More” Approach
Understanding Target Audience and Listening to End Customers
Ensure Pivot represents Growth Opportunities
Which companies have successfully pivoted?
Myntra, redBus, and Instagram are some of the most popular companies that have successfully pivoted.
In this new Insight series we connect with industry professionals to gain idea on starting and scaling a D2C Brand. It features startup experience, growth hacks, D2C industry highlights and learnings directly from expert!
A little background, D2C brands are companies that built its offering around direct digital marketing channels as opposed to selling through an online marketplace, retailer, or auction site. D2C business model in India eliminates middlemen to reach the end consumers and thus saves costs spent on distribution.
StartupTalky exclusively interviewed Dr. Himanshu Gandhi, Co-Founder and CEO of Mother Sparshto know his perspectives on D2C Brand & how he scaled Mother Sparsh from INR 10 lakhs investment to achieving an annual turnover of approximately INR 22 crore in FY20. Mother Sparsh is an innovative eco-friendly baby & mother care brand focused on delivering a holistic experience to the mothers and babies with their natural, eco-friendly, biodegradable, paraben-free and chemical-free product offerings.
Let’s see what Dr. Himanshu Gandhi, Co-Founder and CEO of Mother Sparsh has got to say –
1.From where did it all begin? It’d be great to walk through the initial journey of the company from ideation, team building to launch, funding, revenue & growth.
The inception of Mother Sparsh happened after my marriage with Rishu Gandhi, who happens to be the co-founder of the company. Prior to our entrepreneurial journey, I was a government officer while Rishu was a Java Developer at Infosys. After our marriage, we discovered our shared zeal to identify and fill the gaps in the baby and mother care segment.
We got into rigorous Research & Development (R&D), which was inclined towards recognizing the specific personal care needs of babies as well as mothers, and evaluating it in lieu of the gaps in the market. Therefore, our relentless endeavor to fill the gaps in the segment by working on a need-based proposition led to the birth of Mother Sparsh in 2016. We started with a seed funding of nearly INR 10 lakh, which was used in R&D and development of our first few products. We were able to break even in FY ’20 and went on to close the previous financial year with revenue of nearly INR 22 crore.
2. How do you differentiate yourself from other D2C brands in the ecosystem? Highlight the USP, Features & the problems that your brand tends to solve.
There are several D2C brands in the personal care segment, but the same does not stand true in the case of baby and mom care brands in India. Even if there are a few, they are mostly the ones with product portfolios laden with harmful chemicals and toxins. We are probably the only Indian nature-based baby and mom care brand that caters directly to the end consumers with its wide range of innovative products. For instance, we were the first D2C brand in India to introduce 99% Pure Water unscented biodegradable baby wipes that are good not just for the sensitive skin of the little ones but for the environment as well.
As mentioned earlier, our USP is that we bring the power of nature-based ingredients and Ayurvedic herbs in the most unadulterated manner, in a form that suits the modern lifestyle of millennial moms as well as their babies. While working on a need-based proposition, we have introduced products like Dashmoola Hair Lep, which new moms can use to deal with all kinds of post-pregnancy hair and scalp related troubles. Over past few years, we have fulfilled our commitment to solve or personal care woes of moms and babies with solutions that originate from mother nature.
3. The pandemic has posed its own challenges and opportunities. We are intrigued to know how it impacted the D2C industry in general and your company in particular? What strategies, plans etc., did you adopt and where do you stand at present?
The pandemic has brought about a significant change in the buying pattern of the consumers, with the trend now being more inclined towards online buying. This stands true for the consumers based in metro cities and those based in tier-2 cities. Further, for D2C brands, the consumers are much more willing to adapt and evolve to purchase products directly from the official brand website. This has been enabled by the increased assurances that the consumers have gained with regard to buying products and merchandise from the brand website.
For D2C brand, the marketing strategies were focused to increase the website sales and the marketing orientation has changed towards website. Moreover, the brand has worked and developed a loyalty & good customer retention programs. For example, we have curated a specific set of offers for our website to help retain our customers.
We observed a significant increase in the traffic during the pandemic which also helped us to make a change in our marketing orientation and eventually we had invested a decent amount on our website to get the traffic along with the specific set of offers for customers.
4. Target-based marketing is the craze these days! What are the offline & online marketing strategies adopted by your brand? How do you ensure that your brand is known across the nook & corner of your target market?
Mother Sparsh has always tried to work towards baby-mom specific set of products and bring innovation through its merchandise. In terms of reaching to our target audience, Mother Sparsh worked for better penetration via hospital sampling amongst premium hospitals across PAN India, catering specifically to expecting mothers during the early phase of pregnancy. We have effectively worked in this manner to achieve success and the brand continues to working on the sampling mechanism this year as well.
Besides, the brand campaign designed is ensured to serve with the right set of communication for reaching out to the influencers. As per the feedback fromvarious mothers, we have witnessed a big concern over hair fall in the post-pregnancy stages. So while making the effort of understanding the consumer need and bringing innovation as a factor, we launched Ayurvedic Dashmool Hair Lep.
Also, we ensured a wider outreach via various campaigns on Instagram and Facebook groups & mom communities so as to reach every nook & corner of our target market.
5. Amongst thousands of companies in the D2C domain, how did you evolve your brand identity and create brand loyalty amongst your customers? How do you control the 4P’s (Price, Place, Promotion, Product) of your brand.
In India, the culture of buying products via D2C companies is evolving at a very nice pace and is currently in a dynamic phase in our country. For Mother Sparsh, the key for creating a brand identity has always been its offering. In terms of our efforts, we have managed to provide India’s first water based wipes which is eco-friendly. The brand has maintained its ethos and launched products on Need-based Proposition and throughout worked to evolve the market.
The journey of Mother Sparsh has evolved with bringing innovation from its products, whether it be India’s first water-based wipes or After-bite solution for babies, which is very unique and one of its own kind of curative action.
As mentioned earlier, the brand recently launched Ayurvedic Dashmool Hair Lep, specifically curated product for hair-fall for post-pregnancy. The concept of this product was introduced from home remedy which is positioned against chemically made gel/crème based products available in the market.
With regard to controlling the 4 Ps of Marketing Mix –
For products we strive towards innovation and need-based positioning
For pricing we work on a valued pricing mechanism.
For place, we cater to aspirational consumers hailing from middle to higher income group, and
As far as promotion is concerned, we have relied majorly on brand website offers, hospital sampling and top e-commerce platforms such as Amazon, Firstcry etc.
6. How does your supply chain model add value to the company’s process? From product development, making the prospective customer aware of the product to order placement, distribution & post sale services, what does the process look like?
The brand inherits a culture of R&D and quality driven products, therefore, the value of pursuing or products starts from deep dive market research. Also, we incorporate the feedback of consumers (mothers) about the need and requirement for their wellbeing.With this extensive study, comes the quality work of our R&D team to understand and recommend the most suitable offerings in sync with the ethos of innovation of the organization.
While different types of media vehicles are leveraged, we enable effective communication by inking associations with various influencers on social media as well as tools like Facebook ads, google ads and print ads.
With every effort of launch, we are always willing to provide the feedback to our team members so as to continuously work on our offerings which eventually helps us to evaluate and create future path for new development and process enhancement.
7. Product Differentiation is the key! How do you ensure a higher degree of personalization/uniqueness in your product range? Are prospective customers surveyed? Is feedback mechanism reliable? Or any other strategy? Is your R&D strong?How do you stay on top of new technologies and changing customer habits?
The uniqueness of our product range comes from the fact that we provide expertly crafted nature-oriented solutions in the form of ready baby products. The brand inherits a culture of R&D and quality driven products. The journey of Mother Sparsh has evolved with bringing innovation from its products and inheriting the values of innovation. We stay on the top of the things majorly by motivating our R&D team to attend webinars and encourage them to widen their area of study.
8. What metrics do you analyze to compare your performance from that of your competitors & previous periods? (E.g. conversion rate, unique customer, visitors rate etc., ) Real-life case studies/metrics information would be much appreciated.
Mother Sparsh’s offerings for the niche nature-based baby and mom care market have no competition as such with any other brand. This is primarily because most baby and mom care brands thrive on chemicals and toxins rather than nature-oriented ingredients. More or less, the way we serve our consumers is different where we indulge in consolidating our understandings about home remedies & natural remedies to develop new products.
9. It’s be great if you could share any Advice/expert’s opinion/findings on the D2C ecosystem in India. And what do you think is the future of this industry? What should the budding entrepreneurs have a look out for?
D2C undoubtedly is the future in the market. But as a founder, we are concerned about the quality parameters which we feel should be enhanced so as to give value to the end consumer. It is also imperative that any entrepreneur who introduces new products in the market must ensure that while they are conducive to the needs of the consumers, they should not leave any harmful after effect on the environment.
The idea behind the endeavors of any budding entrepreneur should be to thrive on eco-friendly and organic product range that leads to holistic wellbeing of both individuals and environment.
Parnas Ghosh
