Affiliate Marketing That Works While I Wait For my Back Surgery


If you know me, you will know that for the last year, I have been off work with a back injury and I am waiting for back surgery after having tried everything else. ACC isn’t keen to pay for it and I am now waiting for a Review with them and also for an appointment with an Orthopedic Specialist at North Shore Hospital.

I was referred there on 9 April as Urgent and when I rang last week, they said I would be seen within another month or two and confirmed that they do of course have cancellations. I pointed out that I am close by and ready to come at a moments notice, having been off work for over a year now. You can check out the Back Story on my Back here.

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I have to sit on a cushion with a wheat bag behind my back

So what have I been doing this last year? Stretching,

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Hanging upside down is great and then gravity comes back

exercising, doing aqua aerobics, hanging upside down, going to specialists, having scans, steroid injections, floats, walking, sitting, stretching, working 6 hours a week and waiting for someone to approve the surgery that was recommended by my specialist.

Now if you know me, you know I am not one to sit down. I look for opportunities to keep busy.

All this time off made me think about retirement. No I don’t want to retire for many years yet. I’m anxious to get back to work full time which I should be able to do, 6-8 weeks post surgery. But when I do retire, I sure don’t want to rely on the pension to give me lifestyle.

I decided that Affiliate Marketing was the way to go. I tried several options as I will outline below, and I have come to the conclusion after some expensive trials with other vehicles, that Wealthy Affiliate is the way to go. It is simple, the education is awesome, and I am well on the way to building something that will provide me with an income in the future when I need it. More on that below. But if you want a shortcut to check out why I chose this without reading on. Click here.

Amway stageI’ve often thought about being able to have a passive income that would provide for my future and I’ve tried various things. Long ago my wife and I were Amway members and we developed a large downline. We even got to the famed 21% but it was incredibly hard work and we could see it really wasn’t for us, especially in New Zealand where there were not that many products and whilst the training and atmosphere was awesome, the income wasn’t.

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I wrote another book which I published in December after a great many reviews, because I have been taking fairly large doses of painkillers every day. but I got there.

I planned to write and sell a course for first home buyers via an organization called Clickbank. I spent a fair amount of time and money after signing up to Clickbank University and learned quite a bit about Affiliate Marketing, but I felt their system, based around selling courses was a bit limited on its own.

Then I found that the target market for my book, young first home buyers, don’t really like to read. So I set off to create a YouTube video version of the book. You can find it here. It’s great free information.

Through the course I also set up an email list on aWeber. But this also required cost and a lot of work and I decide that people looking to buy their first home, are not looking for training even though in my opinion they really need it.

So after many months, I still wasn’t getting anywhere, until… I discovered Wealthy Affiliate. What was great about it was that it was a no nonsense, paint by numbers course that had you finding a niche, researching it, buying a URL, searching keywords, doing SEO, setting up a website in no time flat and before you know it, you are almost ready to start generating an income.

I just wish I had found this a long time ago. Now this is not a get rich quick scheme. I don’t think anything like that even exists, but without any knowledge of current web set up, I created Guitar Love. This is a website that is going to entertain and educate established and learner guitarists about everything from how to pick a guitar, accessories that make playing fun, writing and composing songs and music and much more. I will share affiliate links to products that I love, help them get good deals and get a clip of the revenue for my trouble.

I just can’t tell you how easy it was. I’m not saying it isn’t a lot of work, but any business is. I’m not looking to make money right now, but I could if I wanted to. I’m looking to build something that will give me a better lifestyle in future years.

I have always wanted to find a way to do what I love, writing, blogging, making music and just couldn’t figure out how to do it. Wealthy Affiliate has an awesome community and we all help each other out. It has gamification, it has paint by numbers, it has what I wish I had found years ago.

So, do you want a little or a lot more income now or in the future? All it takes is a little desire and a little work. I’m into it and I just wish I had found it sooner. If you are looking for a way to set up your future like I am. Just click on the banner below and check it out.

If you know anyone else that is struggling to make ends meet, a solo parent, perhaps someone semi retired, a student, or like me, wanting to do something for yourself while recovering from an injury or illness, please share this blog or a link with them. The link has a really low cost introductory offer which I and most people used to determine if the system is as good as it sounds.

Any questions, just leave a comment, or if you know me personally, give me a yell.

How Do You Keep Up With the Massive Changes Affecting Your Business?


How do you keep up with the changing environment you live and work in? Technology is a moving target as are many other elements that shape our environment. There are so many facets to our industries that constantly change while you are trying to keep your business going the best way you know how. 

There are a  number of options. You can join business groups, buy industry magazines, search the Internet, follow social media and talk to others in your industry. So now you are working a 16 hour day and not necessarily making much more progress. Why? Because you are so focussed on doing Business As Usual and your view is based on your insider knowledge, bias and training.

What else can you do? One option is bring someone like me in as a consultant. As a Futurist I scan data using tools I have learned, my own experience in business and a wide focus on STEEP, whilst also having no skin in your business and therefore an objectivity that is hard to find when you have been making decisions that you are financially and emotionally attached to.

What is STEEP? It is about looking at the world and elements within it from the perspective of a wide range of elements and wild cards which make up the world. These key 5 elements are Society, Technology, Environment, Economics and Politics.

Take those 5 elements and apply them to your Business Plan. What is going on in your world right now in relation to STEEP? How might each element impact on your new product launch or sales plan? I would welcome your comments. 

One of the elements of foresight is being able to find connections between seemingly irrelevant  factoids or situations and understand what they mean. Then on top of that sometimes there are wild cards to be considered. What would happen if……..

When you look at information in isolation there are many risks. People form opinions based on snippets of information without seeing the full picture. They assume other people’s opinions, perhaps also based on bias or limited information. People often form opinions or carry them forward based on old data, often not even knowing that it is old data. For example, you may see a RT on Twitter and think it is current information, when in fact it has been retweeted by people for a week. Think about the disinformation that went around in Boston recently. Once it flies around it is very hard to know which information is current and correct.

Unleashing the Road Warrior

Unleashing the Road Warrior

Currency of information is hard to find these days. When a book comes out, by the time it has been printed it is already out of date. When I published Unleashing The Road Warrior, which took me about 6 months to write, it had a currency of about 2 years. After that, all the technology I wrote about was out of date.

We are frequently bombarded with little pieces of information, parts of stories, brief nuggets of 10 ways to be better at something, or 5 ways to become a social media superstar and double your sales. If only it was that easy.

Is there a simple answer? No, there isn’t. However in today’s world, we are connected to many people who are experts in certain areas. There are also people who maintain they are, when they are not. Start by connecting to people who really do know what they are doing. Ask people you know and trust. Check out their credentials. LinkedIn is a good place to start from a business perspective. Are they well connected? Have they been endorsed or recommended? Do you know people that they are connected with that you can talk to?

There are 3 types of people in the world. Those that make things happen, those who watch things happen and those who wonder what happened. Don’t be in the last group if you want to go forward, but also be careful where you get your counsel from.

As a footnote, if you are in New Zealand, or somewhere else where similar things are happening. Fairfax is said to be closing down in both print and online Computerworld NZ, PC World and Reseller News. So where will you be looking for information on your next technology investment or foray? I welcome your comments.

Consumption 2.0 and Mobile Society


I’ve just read an article by Hugo Garcia of Futures Lab in Portugal in the latest issue of The Futurist. He was outlining how younger people today are more mobile, more focussed on consuming goods, services and experiences, rather than being attached to things and places. One area that he was strong on was the fact that people are now so mobile and keen to explore the world and their environments.

Location becomes far more important because you are continuing moving around as opposed to tied to a fixed location in the world. He said that one example is the trend towards not owning a home, perhaps ever. I always hear talk about how hard it is to get into property, I don’t think it has ever been easy. When we bought our first home (to give ourselves and our children some long term security) we bought in a cheap neighbourhood and at one stage were paying in excess on 20% interest. For a couple of years in the beginning, we went without pretty much anything, just to pay the interest. Today many don’t want to restrict their lifestyle, making it a choice, their choice is to live for today.

The ‘office’ is for many people today, especially knowledge workers, not somewhere we need to be a lot of the time and the cost of maintaining an office, commuting, car parking (you could almost rent a room for the cost of my Auckland City car park). We go to the office when we need to, for meetings, teamwork etc, but otherwise I can be much more productive from my home office.

White BikesHugo talks about shared mobility. This is not a new concept, but certainly one that is coming back with a vengeance. Back in the 1960’s the Provos introduced white bikes that anyone could use. The idea was that you grabbed a bike, rode it to where you wanted to go and left it there for the next person to use. Their concept, same as today was to reduce pollution and traffic congestion and promote community engagement. They were certainly engaged as very quickly the bikes were stolen and repainted, but the idea was very good.

Today carpooling continues to grow, Zipcars, recently purchased by Avis, which is currently being debated as to whether it was an anticompetitive manoeuvre, is an example of car sharing, which in principle makes a lot of sense. People share ownership in boats, holiday homes and other items and many people are travelling around the world using the services of portals like Airbnb. There are loads of companies sprouting up like Whipcar, which lets you rent out your own vehicle when you don’t need it.

Globalisation is also an area that is changing rapidly. I remember reading history books about the great depression and how people moved from town to town looking for work. Mobility today is something far more international and international borders are being crossed continually by people in search of work, whether it is because they can’t find it at home, want a better life, or simply enjoy the itinerant lifestyle. Over a million Kiwis are working and living overseas, while British and other nationalities are moving to New Zealand to work on projects such as the reconstruction of  Christchurch.

Hugo points out there are pro’s and cons. “Unfortunately, some areas may become abandoned because they lack competitive advantages. The war for talent between countries will increase, but regions that offer good living conditions may gain an advantage.

I note again that knowledge workers, one of the biggest industry segments today can often work from anywhere and travel when required. I know many journalists and developers that live in small towns for the lifestyle, but can still perform on a global stage.

This mobile society opens up huge scope for innovation and disruption, particularly with location based services, applications for mobile use, which can support the new mobile lifestyle. Kiwi developers can and are developing applications used globally, despite those that say you can’t be successful unless you are in Silicon Valley, things are changing. The money may be there, but they don’t have a monopoly of good ideas.

If anyone knows about a mobile lifestyle its Kiwis, anywhere is a long way from New Zealand. We know how to travel, we absorb and learn and we love new technology. Where we need help is harnessing our smarts, to help our innovators and entrepreneurs to learn how to scale and think big. That’s a tough ask and I don’t think our Government is doing anywhere near enough to ensure that smart people are able to grow from small concepts to large global enterprises.

I was just asking myself how I suddenly got on my soap box, but then I’m not sure I ever get off it:)

Will Bitcoin Become the new Cash?


I’ve written a number of times about mCommerce and digital wallets. Now we have loads of companies offering services for electronic payment. These include the Apple Passbook, and many apps using NFC or other means to exchange money. The key thing that joins the hundreds of apps available is that they are legitimately tied to credit cards and banks. As such they provide audit trails and of course tie the world economy together as much as that is possible.

In the future I have postulated that actual paper money will decline and potentially phase out. I could see that happening in New Zealand faster than many other countries. We only have a small number of banks and clearing houses and as such were able to be the first country to mass adopt EFTPOS in the retail environment. Many people no longer carry cash.

However there is of course the grey market and one of the challenges there, is that people who do not want their money transactions audited. There is a global economy like this. People who are paid under the table for their work, people who deal in illegal activities such as drug sales, stolen goods and others. There are also people who just want to opt out of the system or at least flip it the bird. Cash of course can work around the system easily, there is money laundering and people will accept cash for most things as I experienced a few years ago when I watched a guy buying a used Ferrari with folding money he pulled out of his denim jacket pocket.

Much of this money circulates around the system but not through it and this is a challenge if hard cash currency ceased to exist. Or is it.

Yesterday I was on my way to a Microsoft Cloud presentation (which I will blog about on one of my blogs) either SoLoMo Consulting, or Imersia). I was a little early, so I sat in my car and read the latest awesome TNW Magazine on my iPad. Its a great magazine which I recommend you read if this blog is of interest to you, because it is the Money issue. There I learned about Bitcoin.

Bitcoin is “Bitcoin is an experimental new digital currency that enables instant payments to anyone, anywhere in the world. Bitcoin uses peer-to-peer technology to operate with no central authority: managing transactions and issuing money are carried out collectively by the network. Bitcoin is also the name of the open source software which enables the use of this currency.”

Effectively here is no bank, no fees, no audit trail. There are all sorts of businesses, even retailers, who will accept payment in Bitcoins just as businesses accept payment in other forms of money, such as Bartercard Dollars. The difference again of course is that Bartercard still connects to the banks, has an audit trail and the Governments continue to collect their taxes.

Ultimately my question is, will Governments allow this sort of  “experimental currency” to continue? Can they stop it? It appears to already have a massive following. You can buy a coffee with it, you can play poker with it. There are sites where you can buy and sell Bitcoins such as Mt. Gox and there ar others too, although I noted that one of those has dissapeared and I noted a story there that Barclays had stopped allowing people to trade with them.

So what happens if the authorities stop Bitcoin? (assuming Google or someone else don’t buy them, but Bitcoin does seem to have an anti-establishment feel to it, but it could be all about the money).  Well there is also Dwolla,  LibertyReserve, and a host of other systems. I suspect that as cheap smartphones gain mass adoption in the blue collar world, there will be more interest and demand for ways to continue to do ‘cash deals’ without cash.

Futurists are talking about the Local-Global Duality with shifting borders and changing geopolitical landscapes. The one thing keeping us together as countries, or pulling us apart is money. Financial institutions and Governments  are struggling to maintain a status quo that will keep countries running. As countries grow deeper in debt after the GFC people rush to take their money out of the banks for fear of losing it altogether, which in turn intensifies the crisis.

Farmville Tractor

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I’m not saying I agree with currencies like Bitcoin. I still want my roads and infrastructure, order and safety in my community. I believe that one way or another money from illegal activity still works its way back in, like the guy I watched buying a car for over $30,000 in folding. I do suspect however that we will see a proliferation in ‘currencies’ like this in the future. I also suspect that the criminal elements in our societies could be the ones with the most to gain from them, but also that there will be many scams which will be developed to trick people in giving up real money for virtual currency which they will never be able to repatriate. Silly really, when they can legally create computer games and sell virtual stuff and pay tax on legally earned activity with much less risk.

Whitcoulls and Borders


I was thrilled to learn that the remaining Whitcoulls and Borders have been sold to Anne and David Norman. Now they have some hope. They will now live in the Pascoes Group and of course this group are known as having revived the ailing Farmers chain and given them new life.

Once the essential housekeeping details are sorted, such as property leases and staff contracts, there is every reason to hope that they will breathe new life into Borders and Whitcoulls.

That can not mean BAU or Business As Usual, because even though they did OK and the biggest problems were in Australia with REDGroup. Nevertheless these stores were not run optimally and they were not run with the times.

I heard people, partly lead by local publishers, saying that if the NZ stores were run from Australia, they would probably signal the demise of the NZ author. Certainly I agree that we would have seen less Kiwi authors in store, but I think ultimately either the publishers would have to become less greedy and insular or the local authors would start to embrace the new eBook media and of course in doing so they can either self publish or join Amazon or other local eBook publishers. Neither are ideal for people who love books.

As I’ve said in many previous blogs about Whitcoulls and Borders, a few of them can be found here, the first thing is to go back to basics. For these stores to be successful they need to operate smarter and provide what the modern shopper wants. There are many good examples overseas.

With the chain expanding, here a some ideas that I would look at.

  • Macy's

    Gift Registry. Chains like Macy’s in the USA have had phenomenal success with their national gift registry programs for decades. They have kiosks in store which are linked nationally. I was so excited the first time I went through one I almost bought a gift for a young man’s Bar Mitsva in Chicago. I was in New York at the time looking for a hat in one of the coldest winters I have ever experienced. It was so well laid out, there were thousands of special events from weddings to anniversaries and being national, you could see from New York, what a person in Madison Wisconsin had their hopes on. Given that the chain owns Farmers and a number of jewellery stores, this would be a great opportunity to combine the lot.

  • I keep harping on about Jeff Jarvis’ book What Would Google Do? It’s funny in a way that in one of his first blogs about the book, he suggests that you could buy it from Borders. The thing was though that I couldn’t buy it from Borders at the time because they didn’t have it, so I bought it from Amazon.
  • So I think that Borders and Whitcoulls need to start saying, what would Amazon do. So many companies are naive and believe their own hype that web retailers (only part of what they are) are no threat, or they consider them such a threat that when things go bad, they become a self fulfilling prophecy.

Hanging a few Kobo’s on the wall is not the answer, that has been a major botch up in my humble opinion. Even on the web, sell the sizzle on the home page! But some things they could do with their ‘loyalty’ programs is monitor what each customer buys and make recommendations based on the buyer habits. I have bought at least a dozen books on Amazon’s recommendations. Amazon is also much cheaper than buying locally, but that’s a different story because it costs a lot to get books to New Zealand, so unless you buy a stack of books, you pay back what you save on freight.

Amazon has many great features that can be just asdestination events

Mobile Marketing easily applied to a bricks and mortar chain, which has the benefit of being able to hold a book, tell you what store it is in and provide you with much quicker gratification.

I don’t want to write a book, but here a some things you may find in this blog in the coming days for Whitcoulls and Borders:

  • Becoming a destination for events such as readings and signings
  • Back to basics and way beyond in inventory management
  • A major web presence with lots of ideas perhaps sparked by What Would Google Do (which should be a mandatory read for all Whitcoulls and Borders management at all levels)
  • A new way for both stores to have lots of stock available, but not necessarily on the spot. A central warehouse with the option of home delivery could cut down inventory sizes without sacrificing range and depth.
  • Embrace proximity based marketing on mobile devices. I would strongly recommend that management from Borders, Whitcoulls, Farmers and in fact all retail chains attend the Mobile Marketing Forum in Auckland this June. This Forum could be called The Retailer Strikes Back. They will learn many new ideas at this event.
  • Understand their regional customer base. There is no point in carrying the same stock range in each store. It simply won’t work and you will have aged stock going on sale. Some of the category managers need to take a long hard look at the books they have been stocking and ask themselves what on earth possessed them to make some of the decisions they made? Or was it the publishers reps that conned them?
  • They should look at products like GeoSmart’s impending Business Intelligence on a MAP. This could produce many aha moments when used to geographically view their business results in combination with consumer demographics.
I could go on but that’s plenty for now. I think with the right motivation and attitude, these two stores can be not only revived, but will rise to new heights. But only if they stop living in the past of this is the way we always did it. They need to embrace and perhaps even lead the future. It’s not hard, its just thinking outside the square and remembering that it is the customers and the books that make your business. Its about the words and the stories and people.

What FIT’s could do for NZ


Having teased the concept of Feed in Tariffs over the last few blogs  I’d like to get a bit more detailed. So in NZ the government has provided subsidies for roofing insulation, especially for older houses that were not built as efficiently from an energy perspective.

That is good in that it may reduce the need for heating, which is the biggest consumer of energy. A large percentage of energy sources pollute the atmosphere, damage the ozone layer and produce carbon waste. I’ve explored the fact that solar power is a renewable source that produces very little waste, mainly in manufacturing, packaging and installation, marginal issues.

The ideal scenario for me is interest free loans from the Government to cover the cost of purchase and installation of solar panel systems for both domestic and business. There are some lessons overseas where businesses have exploited the opportunities for subsidies and rebates and in some cases they have benefited from the interest free finance and feed in tariffs more than the public. This needs to be considered, but even where that happens, they are still producing energy in forms preferable to oil and coal and other non renewable or potentially dangerous sources.

So the basic idea is that consumers can get an interest free loan to have solar panels and related equipment installed in their homes. The systems include meters and technology that allows people to understand how electricity is being used in their homes, where is it being wasted. They can use the power they generate for free (keeping in mind they do have a long term loan to repay) and when they have excess power, they can sell it to the power companies for a tariff that is mutually agreeable.

A key point that I have raised through out this discussion is redundancy in the case of emergencies. Every time we have had a major emergency people have been without power. As recently as the aftershocks in Christchurch yesterday 17 April 2011, parts of Christchurch were without power for a couple of hours, but previously it has been days and weeks.

UK has had local FIT’s for a couple of years and other countries have had them for several years. There have been many benefits from this. One of the big ones that people don’t automatically think about is job creation. This happens at all levels. Industries to benefit include finance, manufacturing, installation, inspection, education and more. One of the great things about not being first in the industry, we can get our clever Kiwi inventors coming up with new technologies and inventions which will find a ready export market. Many new industries will spawn from this as new developments are made. Mobile technologies will allow control of what appliances are active from your smart phone. You’ll be able to turn off non essential appliances when you are at work, on holiday etc, whilst still monitoring what is going on and being able to turn the hot water back on while you are on your way home.

For business there is the rent a roof program where people can generate income from their roof, while someone else looks after generating the power and selling it into the grid and to the building occupier. This is extremely scalable. In fact in the UK, many roofs rented by power companies are domestic!

Rented roof

Electricity, disasters and Feed In Tariffs


I’ve been itching to write more about FIT for ages as you will know if you have been reading my blogs. If you didn’t, my last blog was pretty much a summary of my thoughts which started with the Christchurch earthquake.

Prior to that for a few years I have been wondering why a ‘clean green’ country like New Zealand only went so far as to provide subsidies for roof insulation and clean heating. Where is the NZ Green Party on FIT, I asked 2 years ago. I’m not even sure where the party is on much at all at the moment and its election year, when National has launched its new policies on oil and gas and other efficient power sources like coal.

In fairness I do have to acknowledge that Environment Minister Nick Smith did through caution to the wind at the NZ Wind Energy Conference this month, but he also made the point that you need windy places and probably also noted the frequent opposition any time someone wants to set up a wind farm. Personally I like them and if they are silent, I wouldn’t have a problem looking up at them on a hill somewhere.

Dutch windfarm

I have 2 interests here, the first one is renewable energy in the form of solar panels, with the ability to feed power into the grid, but also the ability to make individual households and businesses more resilient in times of crisis.

The common thread anywhere in the world when there is a disaster is that the power goes off. In my recent posts this month I have discussed a whole range of issues where we are so reliant on electricity today that there are a variety of problems after the crisis is over.

I want to again acknowledge the heroism of electricity workers and supporters who risked life and limb to get things up and running as quickly as possible.

Anyway, back to my story. Imagine if we followed on from the subsidies to put insulation into our roofs, by offering subsidies and Feed In Tariffs for installing solar panels on the roofs. This is something we should be doing anyway, but imagine if a large number of people were still able to have at least some electricity when the grid is down. They would still potentially have phone communication, they would have lighting, heating, the ability to wash themselves and much more.

We could find ourselves with a renewable energy source that doesn’t pollute, makes people much more aware of power consumption, involves the community and provides greater resilience while allowing us to get closer to meeting our commitments to reducing carbon waste that we so obligingly adopted with the Kyoto Protocol.

It has been said that I am wont to be verbose. I don’t necessarily want to change that because I am intensely interested in what I write about, however I don’t want to lose you dear reader (borrowed that from Stephen King). So here’s what I’m going to do. I am going to write an new series of shortish blogs on the benefits of FIT for New Zealand in the hope that more people will understand the massive potential benefits to New Zealand and put some pressure on the politicians and energy authorities to do something about it.

I’ve done some reading on the topic and found the paper by Miguel Mendonca of the Birkbeck Institute of Environment, Birkbeck College, University of London particularly helpful. He also wrote the book Feed-in-Tariffs Accelerating the Deployment of Renewable Energy. You can find more information here. He discovered that FIT could work in the UK, that it had many positive benefits above and beyond the basics of a renewable energy source and I plan to discuss some of these from a New Zealand context. I also find it interesting that some people (who perhaps are the ones who wanted Henry Ford to breed faster horses instead of horseless carriages) say there is not enough sunlight in NZ to create an acceptable level of energy. Kiwis who go to UK for their OE’s don’t often come back recounting stories of endless sunny days.

So lets explore what FIT’s and solar power can do for NZ, for our resilience, for our GDP, for our commitment to the environment, for industry, for entrepreneurs and to generally show the world that we are in fact as green as we say we are. There are some amazing benefits to be had along the way.

Please come back and check out what I have learned.

Doesnt look that shabby

The end of Whitcoulls and Borders in New Zealand


If you have a Borders or Whitcoulls voucher, even if you hate the idea of spending double to be allowed to spend your voucher, I recommend you do it quickly, because within a couple of weeks it will be worthless. It was interesting to see that there is no mention of the current situation on the Borders website which talks about eBooks coming soon, although Whitcoulls have been a bit more responsible with a home page announcement.

The demise of these companies isn’t about eBooks, it is largely around debt as pointed out by Liam Dann in this morning’s Business Section of the NZ Herald.  and the business models. I’m not going to discuss the debt because that doesn’t reflect on the industry itself, it reflects on higher level financial decisions and the economy, not on the book trade.

Book stores and music stores are in industries that are steeped in history of “this is how we’ve done it for the last 50 years and why change it if it aint broke”.

As was mentioned in today’s NZ Herald story by Isaac Davison, “In 2010, 9.67 million books were sold, an increase of 1.2 per cent in volume but 0.1 per cent down in value against 2009. This was despite the mark-up on books in New Zealand, which saw paperbacks sold for as much as $20 more than online, even after shipping costs.”

So much for Amazon (of course there were a huge number of Kiwis including myself who purchased from Amazon as well) being the cause of the demise of our local stores.

I also appreciated the comment in the same story from Jo McColl of Unity Books that many people bought hard copy books as a consequence of having purchased eBooks. I’ve done that too. I read eBooks, listen to Audio Books and still have a personal library of around 2,000 print books. The same with music, I listen to lots of music online but have still purchased at least 10 CD’s so far this year.

I might have to go to a separate blog about how Whitcoulls and Borders business model needed to change in order to stay viable and vibrant (ignoring REDGroup‘s debt which doesn’t reflect on the book trade business model itself) because for these guys its too late unless they get a savvy new owner (who will not purchase the chains’ debt) who is ready to adopt a new business model.

REDGroup have called in Administrators. I don’t care who the administrators are. Their role is a short term one and it isn’t about changing the business model or trading back into profit. It is about the creditors.

They will try to negotiate with the book publishers and wholesalers and other suppliers who are desperate to get paid for their product and worried about their future viability in NZ. Inland Revenue want their taxes and will be first in the queue.

They will need to negotiate with the 1,000 staff who will have to have new short term contracts and will be justifiably worried about whether they will get paid at all, let alone have a future with the chain, but at the same time, will be essential should they find a new buyer for the chains.

Based on the outcome of their negotiations a decision will need to be made on whether to go into receivership which is next most likely step. If that happens, enjoy the book sale, because there will be many bargains up for grabs.

The shame of it is that (outside of the decisions that got REDGroup into this financial position) the problem in the trade is that the business model needed to change and like the music industry and other industries, the people running them don’t get it. They should have learned from the music industry, which still doesn’t get it. Other industries who don’t get it include banking, telecommunications and consumer electronics to name a few.

What should they have done and what can other retail businesses do in order to not follow Borders and Whitcoulls into the mire? Subscribe to my blog and I’ll give you a few pointers for free. It isn’t rocket science, but it is a fundamental shift in thinking, whilst also remembering the fundamental simple principles of retail and distributon.

We live in a new world, its exciting and there is a lot of money to be made, but the fatal flaw is thinking that if you do the same thing you have always done, that you will get a different result.

There is an RSS feed to this blog. Come back and read some of my ideas on how companies like Whitcoulls and Borders can thrive and prosper.

Here are a few things I would look at:

  • Understanding your business
  • Communication with customers
  • Communication with staff
  • Distribution methods
  • Stock turn and inventory management
  • Engagement
  • In Store Events
  • Proximity based marketing
  • Shelf Management
  • Relationships with community
  • Relationships with education
  • Location Based Business Analytics
  • The Internet
  • Gift Registry

I could and probably will go on. The answers are a mixture of the old and the new, neither of which these chains have effectively managed. Borders started in the right direction in the US, but didn’t continue the evolution. International chains like Borders and WH Smith focussed more on the  era of globalization than evolution of the business model. Something that would have made short term heroes who have probably made their money and moved on, but was only ever going to be short term.