laura baldwin - pivots are overrated: how small changes can unlock markets

Pivots are Overrated

How Small Changes Can Unlock Markets

I Confess

if this doesn’t work…we can always “pivot”

And your time is taken looking toward failure

If William Gibbons is right…

“The future is here it’s just not evenly distributed yet”

then this is your time to

Pay Attention

It’s 1994…

and I am the CFO/EVP at Chronicle Books

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Amazon was just coming on the scene – July ‘94

Print was starting to decline a bit in stores

Authors were demanding more options

Legal/copyright issues were requiring more legal work within publishing companies

Publishing was starting to feel the effects of the upcoming digital revolution

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One of the first publishers to focus on communities Food communities within SF

We were developing a children’s line

And expanding our Art/Coffee Table books by hiring talent

Caroline Herter of S&S came on board

For Chronicle Books we still were growing…

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Investing significantly in legal talent to mange all of our copyright and permission issues

Cost of publishing higher end Art and Photography books was escalating as technologies advanced

Profits were eroding slightly and digital was in its infancy but our titles were not digital friendly at the time…and there was no iPad

But things were changing…

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10

The publishing model was in transition

Market conditions made us question our future

Digital (the future) was not a competency

In today’s language….

TIME TO PIVOT

So what to do….

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Or Not

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What was our core competency?

What are our greatest owned assets?

How were our human and material assets deployed?

How could we capitalize on them?

Time to Pay Attention

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Some of our bestselling titles were from highly talented and well respected folks in the Art and Design communities

Richard Deibenkorn Debra Schenck

Let’s Capitalize on Assets

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And went back to our talent pool with the idea of using their pre-secured permissions to develop new products

We used our core competency of editorial creativity to develop a series of notecards, giftcards and other products that capitalized on the permissions we already owned

So we got creative….

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And Launched a New Division

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..all based on derivative works

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Independent bookstores felt we were “bastardizing” publishing

Large chain stores had no shelving mechanisms for products without BISAC * codes * Book Industry Standards and Communications

But we didn’t give up….

But the markets were not so accepting

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We hired a specialty rep group that soldproducts into gift stores like Hallmark

Which led to the first Chronicle Books books carried in gourmet stores like Williams Sonoma…who then went on to produce their own book line

Once we had some sales we went back to our own markets (namely Borders) who finally agreed to take a chance

If we couldn’t get traction in our markets we’d go to other markets

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And the new division started working

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So we paid attention…and now a large portion (debated between 30-50%) of what’s sold in traditional bookstores is non-book ancillary product…

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So that was then…this is now

Don’t be a futurist: be a now-ist.

Joi Ito – MIT Media Lab

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Mission, Vision and Values Mission: Changing the World by Spreading the Knowledge of InnovatorsVision:We…Work on Stuff that MattersWe…Create more value than we captureWe…Create a context in which other people can thinkWe achieve our mission by espousing and acting upon our core values OpennessHonestyIntegrityNeutralityAnd ultimately…Doing The Right Thing – for our customers, the market and our employees

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Long Term Objective

To build a thriving, next generation media company that survives its founders through a diversified international business strategy that goes beyond books and conferences and accelerates the rate of positive global change.

Old Growth Model – Structured as a Product Organization

Books

Con

fere

nce

s

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But How…by Paying Attention

The same lessons from Chronicle would apply here as well…

What were our core competencies?Editorial insights, event production,

research

What were our greatest owned assets?Brand, employee talent, community based on-line platform (oreilly.com)

How could we capitalize on them?Restructure to focus on audience not

products

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Practice Area Framework

MAKE:DIY

MAKE:DIY

Bra

nd /

Identi

tyCODE:

DevelopersCODE:

Developers

Practice Area

Audience

Segments

Product Line

Audience

Developm

ent

Velocity:Web OpsVelocity:Web Ops

TOC:Publishing

TOC:Publishing

Health 2.0:Health IT

Health 2.0:Health IT

Missing Manuals:Consumer

Missing Manuals:Consumer

Strata:Data

Strata:Data

Respond more effectively to key trends shaping the global landscape

Deliver integrated year round content and services to audience

Ability to offer higher value sponsorship packages that are year round, rather than single point in time

Increase transaction sizes through bundling: customer purchases book, training, conference, membership package, etc.

Exponentially grow the business by adopting new areas as opportunities arise

Practice Areas

So We Flipped the Structure

Editorial / Content Production

as a Capability

Event Production as a Capability

And we created a platform for growth we call …The Extensibility Model

Programming

Data

Web Ops& Performance

So what was marketing became product

And engagement became year-long

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Stay true to your core values

Pay attention to your human and material assets today

Remember small changes can grow new markets and new opportunities

Stop thinking about the Pivot…think about capitalizing now

Be a Now-ist…Lessons Learned

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And next time you’re in a bookstore…

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