It has been a few years since the impact of digital media became soberingly evident.
I was director of marketing when the effects of this disruptive force started to bite. Looking back now, I see the reaction to these powerful market forces was in line with a pattern established in industries far beyond news media.
Of course, the clear view of hindsight is superior to the blurred vision while in the fog of changing technologies, consumer patterns, and business models. But using that clear vision can be beneficial as we face inevitable disruptive forces of the future.
The pattern of behaviour by many successful businesses when faced with major disruptive forces is simple and yet insidiously destructive. It can be stated with mnemonic alliteration: deny, defend, and die.
The first reaction to the crisis, and often it isn’t even recognised as a crisis at this point, is denial:
- “What we are seeing is a passing fad.”
- “We’ve been through these things before, and we’ve come through them.”
In support of my own denial, I reviewed historical examples of newspapers surviving challenges from radio in the 1920s and television in the 1950s. I took solace from the fact that many newspapers weathered those storms.
What I didn’t want to see was that many didn’t. And those that did still saw their circulations drop dramatically.
Once the evidence becomes insurmountable, businesses move quickly to defend their current model and preserve the benefits that they and their stakeholders have long enjoyed. Defensive strategies are put into place, with an attitude of “circle the wagons” and fortify our offerings.
In our case, we added services that paid homage to the changing times but were ancillary to our very profitable core business: print media. Then we found ourselves running two types of businesses, which quite often were competing with each other.
The smaller, and enormously less profitable digital ventures were, to our chagrin, taking customers and dollars from the core. Our goal was to use the start-ups (often being run by those familiar only with the established business) to defend the core, rather than launch a new and innovative and profitable alternative.
Kodak is a great example of this pattern. An exceedingly successful business in the 20th century, it owned nearly 90% of both the film and camera market in the mid 1970s! When digital photography began to grow, it was based on technology developed (no pun intended) by Kodak. But the company denied the future potential of this trend and defended film as far superior to digital.
In 2012, Kodak died, filing for bankruptcy in the United States. Today, it again operates as Kodak, but as a completely different and much smaller company. To help fund its bankruptcy plan, the company sold many patents for more than US$500 million. To whom were they sold? Facebook, Apple, Amazon, Google, Samsung, and others.
The “Kodak moment” truly has been replaced by the “Facebook selfie.”
We have not yet seen the death of print media. But it seems clear the print businesses that do survive will look drastically different than they did at the end of the last century.
So what is the alternative?
Agility, creativity, and bravery.
Companies must resist the comfort of the status quo and remain nimble enough to experiment — and honest enough to acknowledge real threats. They need to be creative in developing strategies that shift their focus to a wholly new business in order to sustain enduring, profitable growth.
And they must be brave enough on two fronts: to take big risks and to give their newly formed strategies enough time to take hold.
Brave patience is especially difficult when you are under the enormous pressure to survive.
And so what is the future for print media? I don’t know. I suspect it will survive as a new, smaller, and less profitable component of a larger news media offering.
I also suspect INMA will continue to serve them with valuable information, provocative truths about the marketplace, and as a conduit to others who face the same significant challenges.