When your world shrinks, go big

Tough business conditions abound in a post-COVID world - but CEO and founder of Penso, Constantine Frantzeskos, argues is exactly the right time to step forward.

No doubt 2020 was a tough year for many businesses. There’s a saying about what happens ‘when the going gets tough’, but I haven’t seen as much of the ‘get going’, the forging ahead that indicates that Australian businesses have what it takes in rough conditions.

The businesses that have done well have been responsive to change, they had a mindset that valued adaptability and versatility, and were therefore ready when conditions altered. The businesses that struggled took a long time to come to terms with the shift. Instead of looking inwards at what they could do, they looked outwards hoping for signs that things would return to normal. They waited for retail districts to re-open and hoped for government help without asking how they could be better prepared going forward.

The stories of these two Australians is what I would like to highlight as a lesson for 2021.

The lucky country?

Being lucky has been our greatest disadvantage for a long time. When Donald Horne wrote The Lucky Country, it was a callout of the way Australia often rode on its luck without investing in innovation because it was easier to take the attitude ‘if it ain’t broke…’, than to envision, prepare and transform.

Ironically, the idea of being ‘the lucky country’ was misinterpreted as a positive sentiment. More than 50 years on, many are only just starting to come to terms with what he meant. Horne specifically wrote that we were mainly run by “second rate people” and urged us to assert what he saw as adaptability stifled by poor leadership: “’[Australia] lives on other people’s ideas, and, although its ordinary people are adaptable, most of its leaders (in all fields) lack curiosity about the events that surround them, so are often taken by surprise.”

It was this surprise that did a lot of damage to businesses during the height of the pandemic. While larger Australian enterprises barely bothered to adapt their operations or products to suit the changing circumstances, we observed a tremendous amount of innovation from small – and medium-sized businesses. The hunger is there. The culture is not there yet.

Go big

Stepping forward takes preparedness, versatility and confidence. It needs leaders to expand the business’ mental and physical availability at a time when others shrink back. In classic marketing terms, physical availability is improving your distribution, sales, access or consumption points. Coca-Cola is one of the biggest brands in the world due to excellent mental availability – superior advertising that people recall – and its global distribution, the ability to position Coke within arms’ reach of almost every person on the planet.

One great example of this from 2020 was Netflix. The global leader in on-demand video streaming was once a subscription-based DVD service that operated through the mail, cutting edge at a time when most people still visited a physical rental store. Netflix was not loyal to the mail service, it simply understood how distribution could be a differentiator.

In 2007, Netflix’s dedication to a distribution-first model became central to its pivot to streaming. As DVD rentals declined and internet services improved, Netflix cannibalised itself to distribute its content online. By improving its physical availability through digital transformation, it predicted improved sales. The content hadn’t changed – the channel had.

Today, Netflix is synonymous with on-demand streaming, which shows the strength of its mental availability. Its superior physical availability, however, drives its success. Available for streaming are TV series, films and documentaries – including in-house productions – across multiple genres and languages via a range of digital touchpoints, from smartphones and game consoles to smart TVs and web browsers. It takes in about US$20 billion annually by charging a monthly subscription for access to these programs, with no contract. In one quarter, just as the COVID-19 pandemic broke in 2020, Netflix subscribers increased by close to 16 million because Netflix made it easier for users to access its service compared to its competitors.

As a business, ask: how easy is it for people to access your products/services? If they can access and buy from you in a matter of moments on any number of well-designed digital channels, you’ve put yourself in an excellent position to thrive. Effective business growth comes from mental and physical availability.

While the effects of the COVID pandemic are still ongoing, Australia now has a chance to seize the moment and be bold about aiming for a global market while others around the world are being defensive. While I acknowledge the need for a break after a harrowing year, let’s make sure it is not an excuse for complacency and mediocrity. Start 2021 as you mean to go on: push forward and help customers reach you wherever they are.

Con Frantzeskos is the CEO and founder of Penso.


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