Michael Carney picks up that Trade and Exchange has finally given up on publishing in print. They ceased to be relevant a number of years ago, and will not be missed today.
However Trade and Exchange were the Trade Me of their day. They seized an opportunity to grab and extend the classifieds market away from newspapers, and in doing so created a large business and a headache for the papers.
Then Trade Me then seized the opportunity to grab and extend T&E’s business, and finally Fairfax completed the circle when they purchased Trade Me to get their old line of business back.
On the way through T&E and Trade Me the classified’s business grew tremendously in size and usefulness, to become the e-commerce engine of New Zealand.
There are a number of lessons to be learned:
- Don’t be afraid of destroying your own business by launching a new one. If you don’t then someone else will.
- If you accept that you are not capable of destroying your own business, then pull out your check book when it looks like someone else will. Once you have purchased them then leave them alone and let them grow independently of your own systems and processes.
- Know when to lose – exit a market when you stop making money, and not a moment before of after.\
(disclosure – I’ve consulted Trade Me, Fairfax and WAN’s Quokka)
So the question is. “What or who will destroy Trade Me and when?”
And will they be smart enough to see it coming and react?
There’s an understandable problem for any business which is currently making money and not looking out for category-destroying newcomers coming from left-field.
The smart thing for T&E would have been to acquire some or all of Trade Me at the earliest opportunity. Another smart approach would have been to use the strong revenue flows to clone TM’s business creating a credible rival. The money would have kept rolling in long enough for the new products to kill off the old.
So who should be looking at this and shuddering right now? Fairfax? TV3? Telecom?
All of the above?