The year is winding down and — I can’t help it — I’m feeling rather reflective.
Who woulda thunk it a year ago?
When I was a kid growing up in the frozen tundra of Green Bay, Wis., my dad used to preface whatever punishment he was about to administer with a line like, “This is for your own good” or “This is going to hurt me more than it does you.”
I never quite believed that, but it does relate to what we are going through right now.
The gods of business — our cosmic parents, so to speak — are opening a big old-fashioned can o’ whoopass on us right now. And it hurts — bigtime. OUCH!
And you know what? It IS for our own good. And it probably DOES hurt them more than it does us.
But if we play our cards right, we’ll come away a whole lot wiser for the painful lesson we’re going through now.
Forgive me for sounding like an old codger (I’m 45, in case you were wondering), but most of the people who launched dot-com companies over the past few years are younger than age 30. There’s nothing wrong with that until you realize that most of them never lived through a recession, a bear market, or an economic downturn.
You would have to be 35 years old or older to have lived through the market crash of ’87 as an adult. You would have to be around my age to remember the gloom-and-doom years of Jimmy Carter — the 18 percent prime rate, spiraling inflation, and widespread unemployment.
How many of the twentysomethings have lived through genuinely tough economies? Or lost their jobs? Or had to eke by on hope and a prayer because life just flat out sucked at that moment? I daresay, not too many. Life’s been pretty good under Reagan, Bush, and Clinton, all things considered.
Yeah, I know. You’re waiting for tales of my walking through blizzards 20 miles each way to get to school. I won’t give you the pleasure.
All I’m trying to say here is that tough times, failures, layoffs, firings, downturns, bear markets, and recessions actually have a positive effect: They sharpen your thinking.
They teach you to focus on that which is most essential — that which is going to contribute to the bottom line.
On the other side of the spectrum, when you have millions of other people’s dollars to blow through, it warps your perspective. You are so well cushioned from the effects of a bad decision that no learning takes place. There’s no pain to endure.
You can piss $2 million away on a Super Bowl ad, waste millions on parties, events, and groovy but vague print ads, and have no sense that there’s a problem.
What else could possibly explain Boo.com’s waste of $120 million in SIX MONTHS???
Right now we’re being held accountable.
The business gods are saying that we gotta think before we spend.
The business gods are saying that they’d rather have 100,000 PAYING CUSTOMERS than millions of people cruising by and picking up the goods for free.
The business gods are saying that we’ve gotta take in more money than we put out — yep, we have to make a PROFIT — and be able to do so on a sustained basis.
Many twentysomethings who haven’t experienced this before are panicking right now; this is all new to them.
They are under the impression that the business gods told them not to spend ANY money on marketing or advertising. Nope, the business gods are saying to invest your advertising and marketing dollars wisely. They would ask Computers4SURE.com (formerly Computer.com) where else besides a Super Bowl ad they could direct that $2 million to get a better bang for the buck.
Twentysomethings are under the impression that the business gods want them to STOP hiring, to lay off like crazy. Nope, they’re saying that you need to hire the sharpest minds you can. Hire people better than yourself, and pay them enough to keep them for the long run.
Many twentysomethings might even be under the impression that the business gods say that there is no money to be made on the Net — that perhaps it was all an illusion. I don’t think so.
Maybe the way we have done business over the past few years, calling it the “new economy” (I call it “fuzzy math”), isn’t sustainable for the long run.
But if you really look at it, you’ll see that the Net STILL provides incredible opportunities for smart businesspeople to launch and sustain a steadily growing, profitable business.
It’s all a matter of learning some hard lessons.
We may want to take some time over the holiday break to read the biographies of some of those gray-haired geniuses who created successful businesses before anybody ever heard of the Internet.
We can learn from them. The principles of finding an attractive market, serving a real need, doing so in a superior fashion than what’s currently being done — and doing so profitably — still remain.
So let’s learn from the whoopass the business gods just laid on us. Let’s dust ourselves off, admit our mistakes, and learn not only from our screwups but also from those who have preceded us in other industries, eras, and walks of life.
2001 might turn out to be the best year yet!
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