Friday, February 27, 2009

Recessions Can Spawn the Best Ideas

Too bad the wrong folks are getting bailed out (and axed). Reforecast this!

Thomas Friedman really nailed it in his recent New York Times Op-Ed piece “Start Up the Risk-Takers.”

Like Friedman, I bet you're disgusted that the nation’s largest “wealth destroying machines” (GM, Chrysler, AIG, Citigroup, etc.) are strong-arming taxpayers into bailouts while deserving early-stage companies (with huge job creation potential) can’t get funding. Why? Because the old guard claims their funerals will cost us more than keeping them on life support will.

They keep selling it. We’re not buying it. And hopefully Washington isn’t either.

“That is not how we got rich as a country, and it’s not how we’ll get out of the crisis,” notes Friedman. “Some of our best companies, such as Intel, were started in recessions, when necessity makes innovators even more inventive and risk-takers more daring.”

While you don’t normally associate “inventiveness” and “risk-taking” with old line manufacturing and financial services companies, we media types think of ourselves as a little more daring. We like to hang with the technology stars at big conferences. We "whiteboard it" out of the box. But unlike our technology brethren, who really have the stones to reinvent their business models as market conditions change, we can’t quite walk the walk after talking the talk.

B2B media leaders talk about innovation, but tend to skulk back to what they know best when the chips are down. That means protecting their longstanding investments in print media, direct mail and face to face events – and the people behind them – while slashing resources devoted to new media and cross-media platforms. That’s a cowardly approach that will come back to haunt many of you when the economy rebounds.

Tech companies know that now is the time to double down on R&D so you’re poised for growth when conditions improve. Unfortunately, too many B2B media leaders are bailing out version 1.0 these days, when they should be focusing on version 3.0. This simply gets you from one quarter to the next, where you'll spend half your time reforecasting instead of generating new business.

Print, direct mail and face-to-face events still deserve a seat at the table, but they no longer drive innovation, profit margins or enterprise value. And never will again.

As Friedman advises: “Let’s make sure all the losers clamoring for help don’t drown out the potential winners who could lift us out of this.” Words to live by whether you’re selling cars, banking services, insurance policies or advertising space. It’s all about measurable ROI.

Tuesday, February 17, 2009

The Upside of Down Trade Show Attendance

Intimacy and ROI could improve

A recent survey from industry trade group Meeting Professionals International (MPI) and American Express said seven percent of business meetings scheduled for 2009 have already been cancelled and attendance will be down about 12 percent for meetings and conferences that remain on the calendar. Obviously the weak economy has companies dramatically cutting back on travel, entertainment and professional education budgets. Many organizations “don’t want to look like they are spending money foolishly at a time when people are losing their jobs,” said Jack Riepe, a spokesman for the Association of Corporate Travel Executives (ACTE) in a recent NY Times interview. ACTE said 71 percent of its members expect to spend less on travel this year and increase their reliance on teleconferences and Webinars. So where’s the silver lining I alluded to?

First, 2009 may prove to be the year of the Web events, as event planners, out of necessity, are going to have to start finding time-efficient low-cost ways to bring their great content and networking opportunities to attendees can’t afford to be out of the office for days at a time. They also might learn that Web events are a great, low-risk way to test out a new conference idea or seminar track before you go to the expense of rolling it out in the real-world.

Even for in-person events, attendees and exhibitors may find better show experiences this year despite diminished attendance. First, you’re in better position to negotiate deals on airfare, lodging, restaurants, rental cars, etc. which should keep the bean counters back at the home office happy. Also, since attendance is down, you’ll have an easier time getting access to keynote speakers and presenters. At the exhibit hall, you won’t have to wait as long to see demos of products and services you really want to “tire-kick.” And since exhibitors can’t afford to send the usual phalanx of support staff and “demo dollies,” you’re more likely to interact with a highly knowledgeable member of the product development or client support team at the vendor’s booth. If you’re an exhibitor, lower attendance doesn’t necessarily mean lower ROI. With reduced travel budgets, companies can only afford to send their key decision-makers to events, so you’ll have a higher likelihood of more meaningful conversations and your percentage of qualified leads – not simply business cards collected -- should go way up.

Let’s face it. We’re all eating our share of humble pie these days. But the extra calories won’t show up on the innovators who stay lean and mean and learn to co-exist with the Web.

Wednesday, February 11, 2009

Think Before You Slash That Marketing Budget

A downturn opens the door to gain market share and out-innovate your competitors. Recommended reading

By now, you’ve probably been exposed to hundreds of articles and blog posts in the media trades justifying the need to keep the marketing faucet on at all times – no matter how painful. But in the current issue of Harvard Business Review, of all places, Boston Consulting Group partners David Rhodes and Daniel Stelter, argue convincingly that “companies that injudiciously slash marketing spending often find that they later must spend far more than they saved in order to recover.” (See Seize Advantage in a Downturn).

Rhodes and Stelter look at marketing as part of an overall “recession checklist.” They patiently demonstrate that many companies fail to see opportunities hidden in economic downturns. But, before jumping in with both feet, you first need to a thorough, but rapid assessment of your own vulnerabilities and then move decisively to minimize them. More