The cyclical misery
Column As the economic crisis grows, so does the pressure to conform. But not everyone in the media industry is suffering. Many SMEs and freelancers are actually benefiting directly from the rapid rise in cost awareness.
Column As the economic crisis grows, so does the pressure to conform. But not everyone in the media industry is suffering. Many SMEs and freelancers are actually benefiting directly from the rapid rise in cost awareness." In our circles, the question of greeting and embarrassment has recently taken on a lurking quality. The unspoken resonates: "You're probably not doing so well either, just admit it!" The most elegant answer I heard in Interlaken was: "Personally very good". It came from one of the many people who complain in these times without really suffering, but who no longer dare to oppose the general pessimism, because the truth is: there are still good results. Newspaper publishers with 12 or 15 percent cash flow, magazines in profitable niches, publishers who have done their homework and cut costs in good time. But nobody wants to hear that at the moment.
The industry has decided that it is in a bad way; the pressure to conform is correspondingly high. For example, no one talks about the fact that many well-connected freelancers and SMEs are now able to secure mandates that in better times would have ended up with the large firms with their high fixed costs.
In short: as an extremely cyclical industry, publishing tends to generalize, sometimes to rush and almost always to exaggerate, in bad times and in good times anyway. When the economy coughs, we have pneumonia. That's logical - as long as we allow 70 percent or more of daily newspaper revenues to come from the advertising business. This is because many drivers of the advertising industry simply cannot be influenced. The job market, for example, reflects business decisions and thus the economic expectations of hundreds of companies in all sectors. And if there is famine on the stock market, even those who have always made a good living from financial advertisements have no bread.
But there is something else. Anyone who has ever had to comb through a budget knows the temptation to do what is urgent rather than what is important. As a result, you don't cut back where it will pay off the most in the long term, but where you can make the quickest impact. ("Show", not "achieve": after all, the main aim is to convince the Board of Directors of what a capable manager I am and how quickly I can turn things around). Consequently, the hunt is on for those cost items that are only tied up in the short term. Cutting jobs, closing sites or replacing suppliers worsen the figures because contracts and notice periods have to be observed and other extraordinary costs are incurred.
How much more convenient it is to cut ad hoc revocable orders. And then what hurts us so much happens: by the second budget round at the latest, everything that has always been presented to the outside world as an essential, long-term investment is under the knife: New projects, training and further education, communication and brand management.
Oh yes, the communication! The marketing director decides simply not to release the budget this month and next. The boost from the last campaign will probably still be enough, and besides, Christmas is coming soon... The CEO nods it off and is happy about the cost savings. Agencies and publishers are annoyed by the decision, but have no counter-arguments. Curse this wretched cyclical herd instinct! But what's the point: we also have to go over the budget again.
Okay, but only the second half of the afternoon! Before that, we go to the Efficiency Club. A presentation on an exciting, topical subject: "Gaining market share in the crisis through anti-cyclical behavior."
> Karl Lüönd is a journalist, author and head of the Media Institute of the Swiss Press Association.
The industry has decided that it is in a bad way; the pressure to conform is correspondingly high. For example, no one talks about the fact that many well-connected freelancers and SMEs are now able to secure mandates that in better times would have ended up with the large firms with their high fixed costs.
In short: as an extremely cyclical industry, publishing tends to generalize, sometimes to rush and almost always to exaggerate, in bad times and in good times anyway. When the economy coughs, we have pneumonia. That's logical - as long as we allow 70 percent or more of daily newspaper revenues to come from the advertising business. This is because many drivers of the advertising industry simply cannot be influenced. The job market, for example, reflects business decisions and thus the economic expectations of hundreds of companies in all sectors. And if there is famine on the stock market, even those who have always made a good living from financial advertisements have no bread.
But there is something else. Anyone who has ever had to comb through a budget knows the temptation to do what is urgent rather than what is important. As a result, you don't cut back where it will pay off the most in the long term, but where you can make the quickest impact. ("Show", not "achieve": after all, the main aim is to convince the Board of Directors of what a capable manager I am and how quickly I can turn things around). Consequently, the hunt is on for those cost items that are only tied up in the short term. Cutting jobs, closing sites or replacing suppliers worsen the figures because contracts and notice periods have to be observed and other extraordinary costs are incurred.
How much more convenient it is to cut ad hoc revocable orders. And then what hurts us so much happens: by the second budget round at the latest, everything that has always been presented to the outside world as an essential, long-term investment is under the knife: New projects, training and further education, communication and brand management.
Oh yes, the communication! The marketing director decides simply not to release the budget this month and next. The boost from the last campaign will probably still be enough, and besides, Christmas is coming soon... The CEO nods it off and is happy about the cost savings. Agencies and publishers are annoyed by the decision, but have no counter-arguments. Curse this wretched cyclical herd instinct! But what's the point: we also have to go over the budget again.
Okay, but only the second half of the afternoon! Before that, we go to the Efficiency Club. A presentation on an exciting, topical subject: "Gaining market share in the crisis through anti-cyclical behavior."
> Karl Lüönd is a journalist, author and head of the Media Institute of the Swiss Press Association.
