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On the same day, Facebook, Instagram and WhatsApp experienced an outage lasting several hours. It cost billions in revenue and raised even more privacy concerns.
This is a learning opportunity for businesses on how to approach the development of their operating models and strategies. Dependency on a specific technology to run your business daily is risky, and now is the time to implement additional processes and strategies to mitigate this risk and financial impact. Here are three areas to focus on.
1. Expand your marketing strategies
Marketing campaigns are of the most significant drivers of activity on social media. Campaigns are generally pre-planned and scheduled, so what happens if one of your biggest launches and campaigns happens on a black-out day? Or if your account is compromised for any reason? Being able to re-do campaigns isn’t always as straightforward as changing a date and hitting publish. Depending on timing and other factors, sometimes missing the mark on an original launch date isn’t an option. The chance for a re-do simply doesn’t exist. This begs the question, how dependent is your current marketing strategy?
To answer this, start by exploring the general modes of marketing communication — advertising, digital marketing, direct marketing (email or text), personal selling, public relations and sales promotion. Can you say that your business has implemented and evaluated more than one of these modes? If not, each of these modes should be evaluated for good fit for your business. This evaluation should include:
- Identifying your target market
- Identifying your target customers
- Identifying your unique selling proposition
- Matching your audience problems to your product solutions
- Matching your messaging to appropriate channels
- Setting goals and identifying a way to measure them
Do this as resources allow — focusing on one or two at a time — to evaluate as many unique ways to connect with your target audience as possible.
Often, we find success using one method and stick with it. If it isn’t broke why fix it, right? Wrong! Diversify and reduce your dependency!
2. Optimize your revenue
Like marketing, your product/service mix could have a dependency that you aren’t evaluating closely. For example, suppose your primary revenue source is contingent on your customers and clients accessing social media. In that case, the alarm bells should be ringing very loudly and you should be making plans for diversification.
Start with reviewing the options available for your business to expand sales channels. What we want to identify is an opportunity for additional placement of your products or services. Again, more placement equals greater diversification and dependency.
Consider exploring the following when looking for more visibility for your products and services:
- Online marketplaces, like eBay, Amazon and others
- Foreign distributors
- Affiliate sales
- Outsourced sales
- Value-Added Resellers (VARs)
- Other strategic partnerships and collaborations
In addition to where to place your products or services, consider whether or not it’s time to expand your offerings. Adding revenue streams to your business creates additional diversification within your business by curating products or services that meet more than one need for your customers. You’ll likely see an uptick in customers as well, reducing risk and dependency by focusing on one profitable revenue stream alone.
Strategies to find new revenue streams for your business include:
- New business models, including future contracts and recurring revenue
- Leveraging your existing customers to create new offerings; their feedback holds information critical to innovation and development
- Leveraging technology in business
- Industry innovation (what is the industry doing that you aren’t?)
- Expand to new markets to target new customers
- Follow the money; research what customers are buying and spending and look for opportunities in your business to meet those needs
When evaluating these strategies ask yourself, where is money being spent and what do future trends look like? Can my business leverage content creators and collaborators to get my brand across to a greater target audience? What feedback have my customers/clients been providing that I haven’t given enough attention to? Often in this feedback, we find answers to what’s next for our business.
Valuation creation should be an inherent part of your decision-making process. Build customer relationships so that even when social media goes dark, they will read your emails and visit your website. Have them come to you!
Social media is prevalent in business today as we are operating in the digital age, but we shouldn’t confuse this to mean that it is the be-all and end-all for our businesses. We have heard the term “pivot” continuously throughout the pandemic, and I would suggest that we look at this as a continuous part of the business decision making process and not just when extraordinary events happen.
3. Risk modeling
Perform regular risk assessments of your business operations, looking for dependency. Focus not only on revenue and marketing but throughout the organization.
I see this time and again. Businesses have adapted to routines for people, processes and technology. I have been in countless conversations with clients who tell me that if so-and-so leaves an organization, no one else can do their job or if a certain software breaks, the business cannot operate.
We can’t look at our businesses reactively, meaning dealing with these risks only after the worst-case scenario has happened. Making risk assessment a priority in your business is a proactive approach to managing your operations. It’s no less important than curating customer relationships, paying suppliers on time and maintaining your equipment.
In investing, we often recommend diversifying your portfolio because putting all your eggs in one basket is risky. Looking at your business in a similar fashion will protect you while growing.