owen at owengreaves dot com

Traditional Business Is Still In Denial

Here it is, September 1st, 2010 and two things jumped out at me this morning after reading some business news. Newspapers still think they have something solid going, and Mall’s are still being touted as a good investment. With all the evidence that traditional business is failing in most sectors, those incredibly smart people are making critical errors in judgement.

Yesterday, a company called POSTMEDIA/Network announced that they have a new logo. Now it’s not the logo that has me scratching my head this morning. Former President of Roger’s Paul Godfrey is the President & CEO of Postmedia Network, this group’s list of brands should make you wonder why they continue down the futile path of print. Considering that Newspapers are dropping like flies these days, the predicting doom of book stores and other outbound media, why would you or anyone else invest in this venture? Not one but 11 brands under the Postmedia Network umbrella, all newspapers! They handle the National Post, Times Colonists, The Vancouver Sun, The Province, Calgary Herald, Edmonton Journal, Leader-Post, The StarPheonix, Ottawa Citizen, The Windsor Star and The Gazzette. These are probably the most read newspapers in Canada, and are also failing.

You can find Canadian Newspapers listed in iPad, you can’t read them, the list is of their websites you have to go visit, this will have to change if they want to survive. Newspapers should scrambling to make as many mobile apps as possible, build other ways of generating revenue. The online ad market is staggeringly huge, but for some reason print & TV are merely poking a stick at it. They will all but be forgotten when the other 3 billion people come online in the next 2 -3 years.

Another confusing move this morning, I was actually surprised how I responded when I read that a Mall in Surrey, B.C., Canada was sold for $91 Million, that’s cheap by today’s standards but it still sold. But a mall? Granted this mall is anchored by some heavy weights, SAVE-ON FOODS, Canadian Tire, Staples, Winners, HomeSense, Cactus Club and HSBC, plus 26 other businesses. Back in the 70’s & 80’s, he who owned the channel of distribution, had a secure future, would never be in danger of being out of business. Now, we still need some box stores, we will need warehouses, forklift drivers and so on. But you can also see where most of these mall businesses will either be 100% online or gone.

So the questions begs to be asked, why would you buy a mall? The investment of the land? Maybe. The longevity of these businesses remaining long time anchors in a mall? Maybe, but I doubt it.

These moves in of themselves are not life threatening or even bad for that matter by today’s standards, but in the next 3 – 5 years, I suspect they will be asking themselves what they were thinking.

Consider these two small movements today, and I quote, profits in Canada’s non-residential construction sector will fall to a five-year low this year, that’s according to a report by the Conference Board of Canada. Pre-tax profits for this year in this sector will be 1.2 billion, down from $1.4 billion in 2009, and will not recover to pre-recession levels until 2014, at it’s earliest, it’s survey forecast. If at all I wonder.

In Washington there is more bank demise, the number of problem-ridden US banks rose to the hihest levels in 17 years, just in the second quarter! The number of institutions on its “problem list” rose more than 7 percent in the second quarter.

Traditional business is still in denial, they keep doing business as usual thinking everything will turn out alright. Really? Do you really think things aren’t changing, do you really believe that a global population who screams to be heard, to be served the way they want to be served, they want it to be almost free or extremely low cost, they want it in an Open & Free Business Model. Today’s public will look until they find it the way they want it, no longer can you force people to do it your way big business, you best pay attention, because if you won’t, someone will pay attention and take your business. Wake Up!

On a positive note, today the Bank of Canada interest rate hike has been delayed : )

About Owen Greaves

I'm a Futurist, I write, speak, and teach the open & free business model, the future of business. Create. Differentiate. Deliver.  

6 Comments

  1. […] This post was mentioned on Twitter by Owen Greaves, Owen Greaves and Rob Cairns, Rick Rake. Rick Rake said: @OwenGreaves of #Abbotsford shares more on open, free business model. Are you in denial? http://tinyurl.com/2fpqtnu […]



  2. Anonymous on September 2, 2010 at 8:32 PM

    Owen,
    Very well-written post. If you’re talking newspapers & malls (somewhat) here, I’ll agree with you. But when you throw a net over “traditional businesses”, I’m gonna have to beg to differ. There are alot of successful companies out there and many small businesses that do listen to the client and serve the client in very favorable ways without having a strong social media presence (if any at all).

    These “big business has been screwing the customer for years and now with social media it’s payback time” posts are getting a bit tired. Moreover, corporate involvement in social media is still relatively low. Lastly, this is not the first (nor will it probably be the last) economic downturn this country has faced and it has rebounded every time the old-fashioned way: offering a great product/service at a competitive price and delivering said product/service with excellent customer service. It’s still happening today.

    Nuff said.



  3. Anonymous on September 2, 2010 at 8:32 PM

    Owen,
    Very well-written post. If you’re talking newspapers & malls (somewhat) here, I’ll agree with you. But when you throw a net over “traditional businesses”, I’m gonna have to beg to differ. There are alot of successful companies out there and many small businesses that do listen to the client and serve the client in very favorable ways without having a strong social media presence (if any at all).

    These “big business has been screwing the customer for years and now with social media it’s payback time” posts are getting a bit tired. Moreover, corporate involvement in social media is still relatively low. Lastly, this is not the first (nor will it probably be the last) economic downturn this country has faced and it has rebounded every time the old-fashioned way: offering a great product/service at a competitive price and delivering said product/service with excellent customer service. It’s still happening today.

    Nuff said.



    • owengreaves on September 2, 2010 at 9:59 PM

      Specifically yes, Malls & Newspapers. I whole heartily agree withyou that BIG Business has been screwing customers and small business since I can remember. There is and always will be some businesses that do it right, but in general, I think not. In Canada, Social Media is still a water cooler mentality, most businesses do not see value in the conversation, they’re feeling it’s not good use of time. That’s been my experience in my area.Traditional business is in denial, the world of business is changing at a pace they can’t keep up with, nor do they know what to do for the most part. Personally, if you or I happen to know of businesses doing it right, we should be talking it up on they’re behalf, we should be patting them on the back. So if you know of any, please let me know and I’ll write about them. The real truth is, if your product or service is crap, it won’t sell in the new model of business, even if it’s free it won’t do much. I agree with you that offering or providing a great product/service at a competitive price, along with top draw customer support, those businesses will win everytime.Having said that, I think we are saying the same thing from a different point of view. But in general, I still see traditional business in denial, hopefully, they will get started before it’s too late. The next 2 – 3 years are critical, after that, it most likely will be too late.Thanks for your comment and perspective, glad you are here to share your view point.Owen



  4. owengreaves on September 2, 2010 at 9:59 PM

    Specifically yes, Malls & Newspapers. I whole heartily agree withyou that BIG Business has been screwing customers and small business since I can remember.

    There is and always will be some businesses that do it right, but in general, I think not. In Canada, Social Media is still a water cooler mentality, most businesses do not see value in the conversation, they’re feeling it’s not good use of time. That’s been my experience in my area.

    Traditional business is in denial, the world of business is changing at a pace they can’t keep up with, nor do they know what to do for the most part. Personally, if you or I happen to know of businesses doing it right, we should be talking it up on there behalf, we should be patting them on the back. So if you know of any, please let me know and I’ll write about them.

    The real truth is, if your product or service is crap, it won’t sell in the new model of business, even if it’s free it won’t do much.

    I agree with you that offering or providing a great product/service at a competitive price, along with top draw customer support, those businesses will win everytime.

    Having said that, I think we are saying the same thing from a different point of view. But in general, I still see traditional business in denial, hopefully, they will get started before it’s too late. The next 2 – 3 years are critical, after that, it most likely will be too late.

    Thanks for your comment and perspective, glad you are here to share your view point.

    Owen



  5. Emmi134 on April 7, 2011 at 2:29 AM

    Tradiational business is getting the support of new social media….which will make many businesses let it be small or big global……It will ensure to target the audience by more filtration.

    http://www.financegenie.net/personal-financial-planning-process.html