How vital are these very tough times

How vital are these
very tough times

Smart media players are positioning for recovery

By Gene Ely

    The future could not seem grimmer. As ad years go, 2001 by late summer was looking to be the third worst in 40 years, behind only 1991 and 1961.
   Then came Sept. 11. A hoped-for fall ad revival disappeared in the rubble of the World Trade Center.
    Now 2001 is looking to be the worst ad year since World War II, and 2002, when many thought a recovery would occur, is looking no less grim. If 2002 does follow 2001, it will be the first time since the Depression that ad spending fell two consecutive years, reports Forbes.
    But while this indeed is a brutal time for the media industry, with thousands now out of work, it is also an incredibly vital time. It's a vitality whose significance is worth pointing out as we enter the holiday season and look beyond to 2002.
   It is of significance to buyers of media no less than sellers.
    There will be a recovery, as there always is, and how media companies position for that recovery over the coming six months will determine the structure and look of the media marketplace for years to come.
    Down markets are very different from up markets, for sure, but they are not different markets. They are rather different games within the same game. They are played differently, but they are played. It's not like a baseball game where you walk away when the rain pours down.
    You play through the rain, and you play your rain game. You hope your rain game is better than anyone else's.
    What's happening now, reflecting a state of rising panic, is that a number of media companies are slashing budgets with unprecedented ferocity.
    In too many instances, the accountants now rule, and in their panic they are slashing away assets that were built up over years and whose loss can never be redeemed. They are running in from the rain.
   At smart media companies, in contrast, it is the strategic thinkers who are making the decisions, ceding nothing to the accountants. The pruning is far less brutal. Rightly, all their energies are being allocated to positioning for the recovery.
    At some level, that means simply building on tactical advantage, moving into markets or services one's competitors have fled.
    It can mean building market share, which is a classic endeavor on the part of aggressive companies in any downturn.
    But these media companies are also reenvisioning their markets.
    One value of downturns--and this is across all economies--is that they clear out the junk. They shake the trees free of their dead branches. You see the marketplace much more clearly because there is less impeding clutter.
Also, as you watch bad notions disappear you see new ones arise, and they are often the smart ideas of the market that's coming into being. They signal the future.
   But the most significant quality of a down market is the rigor with which it separates true value from lesser entities that have survived for years on glossy catchphrases.
   Down markets force a return to quality.
   In magazines in particular, they force both buyers and sellers to look beyond the thicket of numbers to the quality of the magazine itself, and to the quality of its readers and their attachment to the publication.
    It is no surprise that we hear so much these days of "wantedness," the new vogue term for readers who care.
    It works the same in TV and other forms of media.
    But quality, unlike numbers, is an elusive thing. You can't sell it like breadsticks, as a commodity. You have to understand it first, then be able to explain it.
   That is something only very smart media companies that truly believe in their products can do. That will be their challenge over these coming six months.
    For buyers of media, the challenge will be no less daunting. There will less safe buying. A bad choice, though seeming to be safe, could end up a disastrous one if that media property should disappear.
    Buyers will have to step beyond mere numbers to discern those media properties that will be shaping the coming media marketplace. That's going to call for a greater reliance on intuition and risk-taking. It's going to entail a search for quality.
   But the rewards will be huge. They will be forming relationships that we return many times over when recovery comes.

-Gene Ely is editor and publisher of Media Life.

Printer-Friendly Version | Send to a Friend
Cover Page | Contact Us