How To Counter A Disappearing Business Model
Is your business model disappearing? How can you counter that and ensure that you adapt and change?
I saw a very good friend who also runs his own businesses last night. We had dinner and a few drinks and then a 15 mile mountain bike around tracks, fields and causeways in the Cotswolds this morning. It was a good catch up followed by a good work out (I had to life my bike over about 10 fences so did some weights too).
One of the things we discussed was the way that some things that appeared to be here forever suddenly disappear.
Take DVD players. He offered me one that he was getting rid of for my daughter to use when she goes to university. I said that I don’t think she would remember what they are for or how to work them.
Within just one or two years we stream everything. Want to watch a movie? Stream it. Box set? Stream it. No DVD required.
My favourite disappearing story model is the Yellow Pages. For years, they kept putting their prices up to ridiculous proportions. Then Google game along. Yellow Pages didn’t take the internet seriously or seriously enough and before you knew it the Yellow Pages book was only three pages long and their shares are practically worthless. They were down to 1pm at one point.
What is even more ironic is that it seems to me that the only way that they make money these days is by reselling Google Adwords. Really?
My friend also mentioned that the only reason Netflix came into existence was because a very loyal customer of Blockbuster became incredibly frustrated with them when they charged him a late return fee even though he rented 5 or more movies a week. So he set up Netflix. Ouch, that’ll learn them!
So, as business owners, we must always be alert to the impact that technology and change can have on our businesses.
If you see changes taking place in your market place, as Black Cabs are seeing with Uber now, I think you have two ways of dealing with it:
- Stay as you are but ensure your service is the best service possible and keep your price high (think Estate Agents here with online agents taking business away); or
- Compete only on price and disappear within a year to 18 months, like Blockbuster, DVD players and the Yellow Pages.
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