August 24, 2022

Days of Our Lives

This isn't altogether different than the business situations you manage. The program is your product, it's the merchandise you sell. It's an old winner. Now it attracts "old" customers, and is utterly cut off from the rest of your merchandise/customer ecosystem. In response, NBC moves the program (for a year) to their digital platform, where few of the "old" customers will take the plunge, allowing the program to die an uneventful death.

In the Merchandise Forensics work I've performed over the past decade, this topic reappears in the catalog world ... not as much in e-commerce where items churn faster. Catalogers have long-time winning items, and they squeeze profit out of those items forever. Eventually, those specific items have a fan base of long-time customers (i.e. age 65), and those customers (and the product) become disconnected from the rest of the business. The cataloger has a choice ... discontinue the item and lose profit today in an effort to be more relevant in the future ... or run with the product today and have a customer base that is disconnected from the future.

I know, it's not an easy choice.

I'll go back to 2006 when we eliminated the catalog division at Nordstrom. The business hummed along like nothing happened (i.e. a high organic percentage meant that the catalog was essentially meaningless from a profit standpoint). However ... however ... at a customer level the business changed significantly.
  • Our investment in e-commerce and the products that sold well to e-commerce buyers meant that we attracted new customers age 30-45.
  • Our disinvestment in catalogs and the products that sold well to catalog buyers meant that we abandoned customers age 60+.

I got to review customer complaints. Our customer service team would forward me postcards received from 77 year old women in North Dakota ... "we can barely read the writing" I was told ... and these customers were upset. We took away their products, and we took away the channel they liked to shop in.

However, as a business, we were fine. We traded a 77 year old catalog shopper for a 37 year old e-commerce shopper. And we told the 77 year old she could still shop online (which she obviously didn't want to do).

We did the same thing that NBC is doing to the million soap opera viewers that are left. 

These are the Days of Our Lives.

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