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Hi, I’m Kevin Coupe, and this is MorningNewsBeat Radio, available on iTunes and brought to you by Webstop, experts in the art of retail website design.
There was a wonderful line in HBO’s old “Rome” series, in which Julius Caesar says, “It is only hubris if I fail.”
Of course, failure isn’t always immediate. Sometimes it takes time to get to eventual failure, at which point it only becomes evident how you got there, how missteps along the way actually made failure inevitable. At some level, that’s what we’re seeing in the economy right now. The problems with the banks, the problems with housing, the problems with unemployment…these aren’t new problems. It’s just that it took time for the dominoes to fall to the point where we were able to see them…or, perhaps more accurately, they became impossible to ignore.
I was thinking about hubris when a MorningNewsBeat user sent me a copy of the January edition of The McKinsey Quarterly, which deals in pat with how companies grapple with the recession.
This sentence stood out:
“Executives in an industry that lags behind the economy, for example, may imagine that they can avoid a downturn because at first the industry doesn't slow down when the economy does.”
I’ve heard a lot of folks in the industry say things like “people have to eat,” a sentence that often is uttered by people in the food business during recessions. Now, to be fair, there does seem to be a realization that people’s buying and eating patterns are changing…but I think it is equally important for retailers and manufacturers to recognize that what we’re seeing is a “new normal,” that fundamental consumption patterns are being altered in ways that could persists for decades, no matter when the recession ends.
What does this mean? I think retailers have to do two things. First, they shouldn't have hubris about the food industry’s ability to survive the recession. And second, they need to be evaluating the recession in terms of permanent changes in consumer mindsets.
There was another passage from the McKinsey Quarterly that grabbed my attention, though:
“Other executives, failing to realize that their industries tend to revive before the overall economy, may plan too conservatively for the upturn. Decisions about acquisitions, divestitures, and even recruiting or retaining talent often hang in the balance.”
This is a critical realization for retailers to reach, I think. I was talking the other day to a friend of mine, one of the smartest retailing and marketing guys I know, and he made the point that now is the time for businesses to be working hard to steal market share.
In other words, battening down the hatches and going into survival mode is no way to deal with a recession. The long-term winners will be the ones that see this as a moment to deliver a knock-out punch to the competition, to establish and exploit their own differential advantages.
Now, this isn’t an easy combination. It is hard to simultaneously avoid hubris, adjust marketing plans for permanent consumer trend shifts, and get aggressive about market share. Hard, but not impossible.
And maybe even the bare minimum if people and companies want to achieve long-term success.
For MorningNewsBeat Radio, I’m Kevin Coupe.
To hear Kevin Coupe’s weekly radio commentary, click on the “MNB Radio” icon on the left hand side of the home page, or just go to:
http://mnb.grocerywebsite.com/Radio/Radio_Listen_S.las
Hi, I’m Kevin Coupe, and this is MorningNewsBeat Radio, available on iTunes and brought to you by Webstop, experts in the art of retail website design.
There was a wonderful line in HBO’s old “Rome” series, in which Julius Caesar says, “It is only hubris if I fail.”
Of course, failure isn’t always immediate. Sometimes it takes time to get to eventual failure, at which point it only becomes evident how you got there, how missteps along the way actually made failure inevitable. At some level, that’s what we’re seeing in the economy right now. The problems with the banks, the problems with housing, the problems with unemployment…these aren’t new problems. It’s just that it took time for the dominoes to fall to the point where we were able to see them…or, perhaps more accurately, they became impossible to ignore.
I was thinking about hubris when a MorningNewsBeat user sent me a copy of the January edition of The McKinsey Quarterly, which deals in pat with how companies grapple with the recession.
This sentence stood out:
“Executives in an industry that lags behind the economy, for example, may imagine that they can avoid a downturn because at first the industry doesn't slow down when the economy does.”
I’ve heard a lot of folks in the industry say things like “people have to eat,” a sentence that often is uttered by people in the food business during recessions. Now, to be fair, there does seem to be a realization that people’s buying and eating patterns are changing…but I think it is equally important for retailers and manufacturers to recognize that what we’re seeing is a “new normal,” that fundamental consumption patterns are being altered in ways that could persists for decades, no matter when the recession ends.
What does this mean? I think retailers have to do two things. First, they shouldn't have hubris about the food industry’s ability to survive the recession. And second, they need to be evaluating the recession in terms of permanent changes in consumer mindsets.
There was another passage from the McKinsey Quarterly that grabbed my attention, though:
“Other executives, failing to realize that their industries tend to revive before the overall economy, may plan too conservatively for the upturn. Decisions about acquisitions, divestitures, and even recruiting or retaining talent often hang in the balance.”
This is a critical realization for retailers to reach, I think. I was talking the other day to a friend of mine, one of the smartest retailing and marketing guys I know, and he made the point that now is the time for businesses to be working hard to steal market share.
In other words, battening down the hatches and going into survival mode is no way to deal with a recession. The long-term winners will be the ones that see this as a moment to deliver a knock-out punch to the competition, to establish and exploit their own differential advantages.
Now, this isn’t an easy combination. It is hard to simultaneously avoid hubris, adjust marketing plans for permanent consumer trend shifts, and get aggressive about market share. Hard, but not impossible.
And maybe even the bare minimum if people and companies want to achieve long-term success.
For MorningNewsBeat Radio, I’m Kevin Coupe.
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