What is your business models? … Because having one may quite simply no longer be enough

loldog_biz_models

so I took some time last night to walk a few yards up Kent St to hear not one but two Tim’s in conversation at one of The Domain’s regular ‘on the couch’ sessions. Tim Addington didn’t hold back in an interviewing with Tim Burrowes that covered the origins of Mumbrella to its existence without Burrowes, taking in trolling, #skyfail and Adnews swiping on the way.

I wanted to ask Tim (B) about one of Mediation’s more recurring themes of late – journalism, news and print media; and more specifically the dangers of continuing to think of them as one and the same thing, especially as shifts in ad media revenues put pressure on the existing business model.

I made the point to Tim that journalism was important (to society), and asked how he thought we could and should protect journalism as news organisation revenues continue to come under threat?

his answer, typically to the point, was that some journalism will go. fact. and that over time – decades not years – the industry will realign and settle as new models emerge. he identified three for starters … (1) the vertical interest model (2) the conversation model and (3) the philanthropy model.

his points, that (one) journalism will survive because new models will emerge and (2) that new models will emerge, got me thinking this morning whilst talking to a senior media executive, as we discussed innovation in businesses esp. with regard to digital. the observation was that business models have to evolve, but it occurred to me that this didn’t have to be at an industry level – what would a business look like with completely different, distinct and differentiated business models working under the same roof, or P&L, or holding company?

perhaps the key question in surviving the ride of change wrought by digitisation isn’t ‘what is your business model? … but what is your business models?

I’ve tried to think of examples close to home and further afield of businesses and companies that deliberately cultivate different businesses models under the same roof. there are examples of companies that take a business model into new categories (Virgin obviously), and examples of parallel business models in different categories (Jetstar and Aldi). you also get examples of very different revenue streams under one roof – media agencies are a great example. but there aren’t a whole load of decent examples (that I can think of) where fundamentally different and potentially opposing models co-exist under the same roof.

it may be that once the most successful business model emerges, a company is crazy not to divert all resources in that direction – but perhaps that’s the trap? perhaps success is in not being single minded? perhaps tolerating lower margins and revenues on one floor this year means being ready to maximizing the potential of new revenues when the world turns in your direction next year?

many media organisations are already doing this by necessity … but how difficult would it be to make it a choice. if you’re lucky enough to have margins that allow you to experiment, why on earth wouldn’t you go as far as you possibly could when doing so?

Tim is right – different models will emerge. winning tomorrow shouldn’t be like a gamble at the races, where you hope your business has done enough of the right research (and a tad of luck) to back the winning horse (model). instead don’t play the game of trying to pick the winning horse, have a stake in every one.

you couldn’t lose right?

featured image lol created here, where you can also vote for it. obvs.

2 responses to “What is your business models? … Because having one may quite simply no longer be enough

  1. Good read Chris.
    I’m increasingly seeing media businesses diversifying revenue streams both within and beyond advertising – there are several good examples in the Aust market. As you well know Focal Attractions (publishers of Mumbrella) are increasingly moving into events. The Pink Media group is another example where they’ve now moved into financial products for their audience. Fairfax through transactional revenue models through Stayz, RSVP etc. Once you have the brand – and the audience – your revenue options increase. I read an article recently which resonated with me – saying ‘you have to try everything’ – some initiatives will work – others won’t.
    The inherent nimbleness of a smaller independent media business may well be better set up to try – and fail – at new models.

  2. Good read Chris.
    I’m increasingly seeing media businesses diversifying revenue streams both within and beyond advertising – there are several good examples in the Aust market. As you well know Focal Attractions (publishers of Mumbrella) are increasingly moving into events. The Pink Media group is another example where they’ve now moved into financial products for their audience. Fairfax through transactional revenue models through Stayz, RSVP etc. Once you have the brand – and the audience – your revenue options increase. I read an article recently which resonated with me – saying ‘you have to try everything’ – some initiatives will work – others won’t.
    The inherent nimbleness of a smaller independent media business may well be better set up to try – and fail – at new models.

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