In 2017, the McKinsey Global Institute had estimated that as many as 375 million workers (14% of the global workforce) would have to switch occupations or acquire new skills by 2030 due to automation and artificial intelligence. In 2020, we are already seeing the increasing reliance on learning new skills to stay ahead of the curve as governments and country rally to flatten the curve of rising Covid-19 cases. Software companies made up for nearly 30% of all remote jobs according to Remoter.net before the pandemic, however, the industry still battles significant challenges. Tech spending fell in the second half of March for hard-hit industries like dining, hospitality, and travel.
Like all other businesses, the closer a software company is to full staffing, the better it is at seizing new opportunities for helping various industries adapt to restrictions and helping them recover.
In order to boost your software business, we have put together key areas you should be focussing on right now to emerge stronger and more resilient.
- Rejig Your Business Model To Realign: While it is difficult to bounce back with the same agility as pre-pandemic days, look for emerging opportunities in the wake of challenges. Software companies that were reliant on hard-hit industries like travel should consider shifting focus to addressing those in need. ‘Clear’ for instance, adjusted by helping businesses screen employees for Covid-19 before going back to work. Moreover, explore ways that you may be of help in relief efforts, even if there is no immediate commercial gain, as it helps boost your reputation and net promoter score (NPS).
- Re-evaluate Your Financial Health: Preserve cash to outweigh the effects of the crisis. Software companies that have relied heavily on private equity (PE) or venture capital (VC) will need to be prepared to answer tough questions about current and forecasted financial outlook. They will need to have a plan if most of their annual recurring revenue (ARR) comes from areas affected by the virus.
- Plan For Multiple Scenarios: While B2B software companies would not be able to forecast a best-case scenario at the moment, ecommerce has seen a significant growth in certain product categories. Data acquired via NetSuite customers shows online orders have grown by 45%-75% year-over-year in April pre Covid-19. On the other hand, online sales for retailers selling food and household goods brands more than doubled during some weeks in April. Consider data your guide to helping plan better for multiple scenarios.
- Focus On Loyal Customer Base As You Prepare To Acquire New Ones: The cost of acquisition is always higher than the cost of retention, therefore, consider offering a strategic, low-overhead incentive to a long-standing clientele. Focus on well-defined guerrilla marketing strategies to acquire new customer base by prioritising leadership webinars and dynamic advertising on LinkedIn.
- Revise Your Pricing, Payments, And Packaging: Without cutting corners on the cost of services you offer, first focus on emphasizing how valuable you are to your loyal customer base. Offer packages with flexible payment terms or a subscription model. You could look at adopting Product Led Growth (PLG) which doesn’t burn cash on marketing campaigns.
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