Lessons learned at AM&AA July Annual Conference
Attending this year’s AM&AA conference was an eye-opener. I wasn't a surprise that the M&A community is not conducting business as usual. But the creative thinking about how to jump-start and otherwise stimulate activity was inspiring. Some of the things I observed:
• Business and deals are substantially down in many industries.
• Of the existing activity, only a portion is traditional.
• Idle companies and service providers are looking for other things to do. All players are looking for a bigger piece of a smaller pie.
• Private Equity and investment bankers are looking for creative projects to invest idle capital.
• Different types of compensation agreements are being hammered out.
The changes in business are dramatic and many industries are experiencing pressure, which is spurring gutsy, creative new ideas. I’ve seen and also worked with companies to make changes in their mindset and business models, in order to continue to grow their businesses in changing markets. I say “mindset,” rather than “marketing,” because that is where the real insights come from, particularly when a firm has been very successful in the past, yet finds those very practices working against them today.
We’ve entered a time when the marketing strategy steers the business model. Not just because companies need new ways to get in front of customers, but also because the business models themselves need to change. That’s tough for financially-minded managers to swallow. But this market is changing in new, dramatic—and permanent ways.
The solutions are often counter-intuitive. People don't want to be sold. But they do want to buy. Businesses are re-packaging the way they provide their services. They are changing their offerings, their partners and deals being done. In their marketing, they are using digital channels to promote thought leadership, leveraging Internet search, video, and other content. They are structuring more performance-based deals and driving trial & sampling. In short, all aspects of the business are on the table for evaluation.
For the past eighteen months or so, I have been speaking and writing about the reinvention of marketing in the New Normal of this emerging economy. We’ve seen companies apply new practices to launch products and companies, and also to re-launch businesses that need new strategies to contend with the crush of competition and the roar of media noise. Companies that are ready for change stand to profit from new marketing as well as new business models. Those staying the course are at risk.
So what can owners, managers, private equity and service professionals do? Here are six suggestions and resources:
1. Get out and build new networks, outside of your customary professional channels.
2. Tap the ever-expanding universe of free information. Start by Checking out the recommended marketing blogs at the Marketing Executive Network Group
3. Sign your midmarket company up to become a member of Ram Iyer's Midmarket Institute, a community and resource portal focused on strategic planning and global markets.
4. Engage with AM&AA’s own Midmarket Place, designed to go beyond business transfer, to value creation.
5. Participate in Rob Slee’s dialog, where private equity converges with business conceptualization in the midmarket: Midas Nation.
6. Join the Chicagoland Chamber of Commerce Midmarket forum and/or register for the next event, where Keith McFarland speaks from the pages of his latest book Bounce, on ways to “Turn Tough Times into Triumph”