Thursday, February 24, 2011

Dust Off that Business Casebook

Borders Files Bankruptcy, Closing Up to 275 Stores

I can't help but wonder what the failure of Borders implies for other mediums. The store specialized in making you feel at home, creating a place where you could spend a quiet afternoon reading and drinking coffee. Problem is, coffee aside (and sometimes not even that), no one ever bought anything...just as though they had stayed home. It practically invited folks to use the cow indefinitely without ever ponying up for the milk. The "give all your content away and eventually maybe someone will reimburse you somehow" model may end up being another case of unsustainable groupthink. If shoppers' consciences could always be relied on to generate revenue, we wouldn't have security devices in stores.

Remember, during the tech bubble, people thought Internet companies didn't need profits. Weren't price-to-earnings supposed to be replaced by something like price-to-clicks? I don't recall that craze ending well. Eventually, potential consumers must be transformed into actual consumers, as in willing to shell out actual money for content.

My personal business model can be found at!/greatMikePayne

No comments: