Working For A Distressed Media Company
Last week a business news site published an article about how AOL has been the best-performing Internet media stock so far this year. The story was surprising for two reasons. First, AOL outperformed other hot stocks like Apple, LinkedIn and eBay. Second, the business news site saluted AOL for doubling its share price after years of criticizing the company and its leadership.
As someone who worked for AOL briefly during the period when it was on the receiving end of many tough articles about the company, it was great to see a business news site publish a positive story about the company. Frankly, being at a company that is getting pummeled by the press daily isn’t pleasant. It’s the professional equivalent of being in an intensive care unit. Colleagues will ask you about your company in hushed tones. “So... how’s it going over there?” they will ask you tentatively.
With AOL’s recent success, the company has been replaced as the whipping boy in the business trades by a number of other companies like Facebook, Zynga and GroupOn. In some cases the same news publications that built these companies up a couple of years ago are now kicking them while they’re down. And thanks to the power of blogging and social media, bad news spreads faster and further than ever before. It’s become something of a sport to see who can share bad news first.
But for anyone working to rebuild a company that has become distressed, there are some things to keep in mind:
Most customers don’t care. Yahoo may have had four CEOs in the last year, but the overwhelming majority of people who use the site each day don’t care who is running the company. And as long as the audience keeps showing up, the advertisers probably don’t care, either.
Turnarounds take time. It can take years of lousy decisions to put a company in a bad spot. Often, it will take just as long to turn things around.
Bad news is good business. Bad news sells more than good news, just as slideshows can create more page views than serious journalism. Virtually every company of any significance will endure bad press at one time or another.
Everyone loves a comeback. As recent turnarounds at older Internet companies like AOL, eBay and MySpace have shown, people love a comeback. Current and former customers can retain a fondness for certain brands, even if they have fallen out of favor.
Revenue matters. Newer startups are more exciting than older Internet companies, but they often lack a steady revenue stream and are more vulnerable than aging stalwarts. AOL is able to build a media business thanks to a declining yet still significant dialup Internet access unit.
With the proliferation of Internet brands over the past two decades, it shouldn’t be surprising to see some fallen stars resurrected into prosperous businesses. Hard work and determination can pay off, even at a distressed company when the press is telling you to give up.