business news in context, analysis with attitude

by Michael Sansolo

Here’s a comment that I bet many of you have said or heard recently about the evolution of business and the challenge of how to evolve to the e-commerce era.

“I still don’t know (what the future holds.) We’ve been a consumer-driven business. Our consumers wanted it. We weren’t convinced it made a lot of economic sense. When we started it nobody really knew what (it) would be.”

Here’s the thing: the “it” in this quote has nothing to do with selling books, clothing, groceries or any other product on line. Rather, “it” refers to the evolution taking place in how sports are viewed and the struggle to adapt to an entirely new business model. The entire quote comes from Bob Bowman, Major League Baseball’s president of business and media, in a recent Washington Post article.

Nonetheless, it sounds familiar.

In many ways, that struggle mirrors the very conversation happening in so many businesses today, with the great unknown issue being how to migrate to this new world and somehow turn a profit when all the rules seem to be disappearing or evolving moment by moment. Not surprisingly, it leaves us all overwhelmed.

The issues facing sports broadcasting are both incredibly similar and wildly different from those facing the food industry. The biggest difference, of course, is that sports broadcasters aren’t selling a physical product, which means they have no worries about last mile logistics or product selection costs.

However, they are incredibly similar in the reality that consumer habits - especially among younger adults - are rapidly changing thanks to e-commerce and that in turn is threatening a highly profitable and well-organized business model.

John Skipper, president of ESPN, told the Post, “We simply have to adjust to where people are watching sports and serve it there. I think the distinction of television and non-television is kind of a falsehood at this point.” Skipper acknowledged that today you can watch a game on a television, a computer, a phone or even a watch. “But you’re watching a game on a screen and that’s all we care about.”

In many ways, that’s the textbook definition of omnichannel thinking: getting and keeping the consumer no matter how they choose to interact with you.

But then there’s that business issue. After all, ESPN is in the business of attracting eyeballs and lately that’s become a problem. As the Post reported, ESPN has been losing subscribers by the millions annually and more than 600,000 this past October alone, although the network disputes some of those numbers.

Whatever the exact number, Skipper acknowledges that ESPN has a challenge. “We just have to figure out how to thrive within (this new) market.” Bowman of MLB adds, “I don’t think any of us know what the Holy Grail looks like. I think you’ll se a lot of experimentation.”

Obviously, most MNB readers are not in the same business, but this is exactly what you face going forward.

At this point I’d love to tell you the Post reported on how ESPN or MLB completely solved the problem, giving you a simple and easy model to consider going forward. I’d love to, but I can’t and I’m not sure anyone can.

The reality is that all of this is new, different and changing constantly. The essential elements of success from the past might or might not work in the future. In truth, no one really knows.

All we can do is keep experimenting and learning.

Michael Sansolo can be reached via email at . His book, “THE BIG PICTURE: Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available on Amazon by clicking here. And, his book "Business Rules!" is available from Amazon by clicking here.
KC's View: