Give It To Me Straight: Historically successful companies don’t normally die at the hands of overhead, marketing, or even operations. While each can damage a well-insulated company the true cyanide in the coffee normally rests in revenue stream addiction. Any company, but particularly older ones, become attached to historically successful revenue models and as a result, tend to overlook how these models are the very anchor slowly sinking the ship.
Rather than addressing the core problem, company leadership often double down on old revenue models, like when Kmart and Sears merged in 2005. Other examples could be selling more of the same ad space, attending more of the same trade shows, or running previously successful marketing campaigns but with a bigger ad spend. Many magazines, for example, provide media buyers with online advertising assets as a “value add” (free) when they buy enough print advertising – talk about confusing activity with results. If you want to throw a glitch in the matrix tell your print salesmen you want to buy all digital advertising and expect to get print ads as “value add”.
Give It To Me Straight: Often the most painful experience a business will face is when they neglect to spot an opportunity to pivot for success or to prevent failure. Critics always wonder how such smart well-paid people could make such mistakes, like when Blockbuster turned down a cheap opportunity to purchase Netflix and instead built more stores.
As a business strategist, I’ve come to realize two simple truths. First, when executives look upward from their company silo they only see the weather that’s directly above. Second, it’s only during the rough periods that companies ask the question “why”. Why is our business model working, or why would our model fail? In this Lab we will take a deep look at the business model of outdoor (hunting & fishing) TV and how maybe the networks should have asked “why” sooner.
Heads up, the following scenario of a producer buying time from a TV network is going to sting for some of you…