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(August 27, 2001) Although the aggressive play would have been to up the ante for Hot Jobs, you've gotta give the newspapers some credit for being willing to pony an additional $200M into the game. It was a bunt, to be sure, but, they did make contact with the ball. It reminds us of our early days as failed athletes...."good boy, at least you hit it this time". Friday, the Tribune, Knight-Ridder and CareerBuilder announced the acquisition of Headhunter.Net. While the gambit is destined to be swallowed by the newspapers' inability to produce a meaningful sales operation, it does demonstrate that the wake-up call is being heard. Unfortunately, this is just another whack at the snooze button.
(Does anyone else remember that Headhunter was a free service barely 2 years ago? $200M does seem like a good price.) A $200M response to a $450M play 90 days after the fact is the sort of "me-too" thinking that has plagued the newspapers' attempts to protect their cash cow in employment advertising. As we keep saying, a day late and a dollar short is not an adequate strategy. Dependent as this move is on central control, it's obvious that the old guard does not understand the meaning of decentralized organic operations.
Some genius on the acquisition team decided to spin the move as the "emergence of a Coke-Pepsi market". Finally, the thinking goes, consumer choice can be constrained to two brands just like the soft drink market. Obviously, the inspiration for that idea came from someone who hasn't been in a 7-11 recently.
Smart Drinks (like Sobe, Red Bull and others), juices, waters and clear beverages are destroying the old model of a two choice universe. It's been years since there was really a company devoted to the production of a single brand in the drink business. For the most part, they've moved their expertise from drink production into sophisticated, marketing driven complex brand management tailored to the desires of a fracturing economy. Leave it to the newspapers to imagine that a worn strategy from the 1980s constitutes innovation in the 21st Century.
Coke and Pepsi are an afterthought in today's drink market. But, one look at CareerBuilder's placement around the Knight-Ridder sites will tell you that this is no contemporary branding play. Everywhere you look, you see "Old Coke". No Diet, no Dr Pepper, No Sprite and certainly no high-margin, $2/bottle 5 ounce energy drinks. Anyone who wants to pretend that newspapers (or a Career company that grew out of TRW, for that matter) is even vaguely in the same marketing league as Monster or Hot Jobs simply has never managed a real marketing endeavor.Consolidation at the national end of the employment market leaves delicious and wide openings for regional and industry specific innovation. From our perspective, the newspapers have just made an ultimate act of philanthropy, clearing the way for little companies to get in the game. It wouldn't be surprising to see Monster (who are clearly developing Brand Management experience) begin a round of smaller acquisitions through the TMP Advertising agency.
In the grand scheme of things, it's probably no accident that Jason Moreau's move into the public markets happens today. CareerExchange should be trading as "CRX" on the Canadian Exchanges by the time that this column reaches your desk. (You look it up as "CRX.V"). Just the first in the next series of real innovators, Career Exchange exhibits the low profile, high adaptation required to perform in the markets the stodgier players wish to buy. Because they are infused with the bootstraper's disease, they are unlikely to be subject to the overthink, under manage behavior of the larger players. Their growth will most certainly be in the three digit range for the next several years. Think of CareerExchange as the energy drink in the publicly held companies...high margin, high growth, high innovation and high adaptation.
Then compare that performance with the CareerBunt.
We read the move is an open acknowledgement of the newspapers' inability to field sales and marketing teams that work. Creating an outsourcing company that has a regional appearance is the simple play being executed far more effectively by RegionalHelpWanted.com (in 190 markets). It takes a small team and no intent to actually develop a local rapport. The new call center monstrosity (that's it, the Monster and the Monstrosity) will continue to fail to convert the newspaper brand into a National megasite.
The real action is in the "under the radar" Regional and professional play. Take a quick look at SalesHeads and quietly ask yourself if Monster is going to be able to dive into the branding game this hard, anytime soon. The obvious answer is that, while there is a role for a "you can't get fired for using us" option, the real game will certainly evolve to profession (or region) specific sites. That's the essence of the web....Being a big fish in a small pond.Bunting in the major leagues (when you have the ability to make a real play) is a plea for help from a dying breed.
- John Sumser © TwoColorHat. All Rights Reserved.
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by John Sumser
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