November 28, 2015

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First Mediaworks

08/18/03 Are You Mining Fool’s Gold?

During the California Gold Rush, thousands of millionaire-hopeful miners panned for months, gathering a stash, only to learn they had spent all that time gathering fool’s gold, which looks like gold but is only worthless pyrite.

Futurist David B. Wolfe tells me that many businesses today are mining fool’s gold. His words keep ringing in my head. “Most people (and companies) don’t change until the pain of staying the same exceeds the pain of changing,” he says. “Because the demand pie has stopped growing, more and more companies will be folding because of their inability to change.”

Many business owners I know are experiencing pain because they are chasing the fool’s gold of a successful past. Today, many of the successful practices that businesses used in the past no longer work. Everyone wants to blame the economy while assuming things will return to business as usual when the economy regains its drive. A tectonic shift in consumer behavior is masked by the weak economy. According to Wolfe: “The inescapable reality facing nearly all companies is that unprecedented changes in demographic conditions are radically changing the calculus of supply and demand. Population growth — or the lack thereof — is changing the volume of demand, while the aging of the population is changing the nature of demand.”

The world has changed, and few business people understand these changes. They assume that, if they do more of the same things that made them successful in the past, things will return to their glory days. They assume that, once the economy is fixed, their businesses will once again be healthy. The reality is that the economy alone will not repair their woes. According to Shoshana Zuboff and James Maxmin in their extraordinary book The Support Economy, “When the going gets tough for most companies, they do what they have always done, only they do it more fervently in an effort to get through their difficulties.” It’s the classic definition of insanity: repeating the same behavior and expecting different results.

True reinvention will be forced on nearly every business, including Radio, affecting the core methods and business model we’ve followed for 50 years. Wolfe says, “Sales growth now generally has less to do with differentiation of product features, design and otherwise, than with terms of purchase.” Past practices will not work.

If you study demographic changes and the need for self-actualization with aging demographics, you’ll begin to recognize these changes and will be able to counsel your advertisers. As Radio professionals, we must lead blind, hurting businesses through the minefields of their future. I’ve never believed our job is to sell advertising; it’s to be a trusted confidant who can help clients’ businesses thrive. Advertising is only part of the equation. The first step is reinventing our own business model and our methods of helping others make money. That change comes when the pain of staying the same exceeds the pain of changing.

Are you in pain yet?

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