Undoubtedly, Zoom today stand tall as one of the few corporate winners during the coronavirus pandemic. In the midst of mass layoffs and dwindling company profits, Zoom managed to declare a whopping unprecedented profit of $27 Million in the first quarter (February – April) of 2020 compared to the ridiculous sum of $198,000 declared at the same period a year ago.
And to the utter surprise of anyone who cares, the same company forecasts revenue of roughly $500 million for its current quarter ending in July; more than quadrupling the figure estimated in the same period last year. For its full fiscal year, Zoom now expects revenue of about $1.8 billion, nearly tripling in a year. What a big difference one year could make in the life of a business, one might say. But obviously that’s not what it is all about. There is much more. And that’s exactly what we want to unravel now. To dissect and synthesize the major drivers that led to the “overnight success”, or should we say, “perfect timing success”, so to speak, of Zoom. But that’s not all. We will also try to pick key lessons and takeaways and see how they fit into our unique situations and business areas.
While doing these, we shouldn’t get delusional of the fact that Zoom is a teleconferencing company robust enough to have survived up till this point and still delivering on the needs of its customers for 9 good years of not being at the limelight. That definitely takes some level of toughness and consistency. I should probably swallow back my words that Zoom is an “overnight success”. Or maybe “strategically positioned” is a better way of capturing it. Or maybe we should wait and find out.
How to profit from the pandemic: 4 Lessons learnt from ZOOM
#1. Timing is everything
Perhaps the hardest thing to do in life and business is to be able to know what to do and when to do it (the timing). The latter is harder. Zoom knew fully well what they wanted. Their mission is to provide teleconferencing services to their customers in the most convenient way possible. And they have been delivering on that for 9 good years. But the big question is do they know when exactly the vast majority of people across the world will need and depend on their teleconferencing services for survival? Absolutely not. It’s more or less like asking if Zoom was aware 9 years ago that in 2020 Coronavirus pandemic will happen and their teleconferencing business will suddenly boom thus the need to start Zoom then? The Coronavirus pandemic is a Blackswan event of which nobody could have accurately predicted.
In this light, therefore, it is clear that the question of timing in business is a difficult one and sometimes even impossible to answer. While knowing the perfect time to do something is great and can sometimes be the missing link you need, yet Zoom success has taught us that sitting on the sideline without getting anything done wouldn’t help in achieving the set goals either.
Granted, Zoom benefited enormously from the crisis of the Coronavirus pandemic by optimising its luck. But that wouldn’t have been possible if Eric Yuan – Founder of Zoom – had sat on the sideline and didn’t take any step to start the company 9 years ago and strategically position it for growth the way he did.
#2 Free access to selected services
This is a proven business model that is being used by a number of internet companies which allows users have free and unrestricted access to some selected services offered by the organisation in question.
The basic idea is allow potential users to register for free on your website, collect their contact details, give them restricted access to some selected services to have a taste of your services, and wait patiently for them to convert to high ticket customers betting on the believe that they will enjoy the free services and want more value for which they will be willing and able to pay for.
This idea has proven to deliver desired result. It had worked for Zoom, for Facebook and even for Google. Some have even dubbed it the “Google model” owing to its popularity.
Any business organisation can copy paste this model and see signs and wonders happen. The lesson here is self-explanatory: want to build an army of loyal high ticket customers online? Then be willing to offer some part of your services for free without compromising on the quality. After that, just wait for miracle to happen.
#3. Preparedness is key
One common denominator in the success of Zoom was its preparedness and readiness. Zoom was prepared in the sense that it is strategically ready and positioned to offer its services to as many people as possible. It was deliberately built to be scalable.
Someone once said that when luck meets preparedness, success becomes inevitable. That perfectly describes the case of Zoom. While it is true that Zoom is lucky enough to have been around at a time like this, yet it is equally true to say that Zoom wouldn’t have been a corporate success it is today if it wasn’t prepared and strategically positioned to scale the way it did. This explains the importance of being prepared and well positioned for success.
#4. The future is digital
Let’s imagine for a moment that Zoom is not an internet company; that it is not online. Without being online, do we really think Zoom will become a corporate success it is today? Is that even a right question to ask? One might say that Zoom is Zoom because it is online. That is, given that teleconferencing is the core service of Zoom coupled with the digital age we find ourselves, one might be tempted to say that Zoom wouldn’t have become a global success it is today without the Internet.
Having said that, the major takeaway for me here is that no business in the 21st Century can truly achieve its set goals or become a global success without being online. To this end, take that bold step today by taking your business online so as to make it 21st Century relevant.
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