I want to pitch a business idea to our community. For it to work, I need the seven of you who read this to share it with your neighbors. And they need to share it with about 50,000 other people. We can do it.
To make sense of the idea, let me tell you of its genesis.
This business that we own – a free, community newspaper that covers a very specific area – has one basic form of revenue. We produce news and information about a community, and people like you read our newspaper and website. To pay for the people, printing and delivery of this product, local businesses that want to reach our readers buy advertisements.
It’s fairly basic: If we produce a good news product, and if people read us, advertisers will spend some of their marketing dollars with us because they want to reach potential customers like you.
As you might imagine, it’s my job as the publisher of this newspaper (and a few others) to figure out ways that we can grow our revenue to keep up with increasing costs. That’s the name of the business game.
At our company, we take the approach that if our customers are successful, then we’ll be successful, too. Our customers, it turns out, are largely small businesses that have local owners, which means a whole lot of my time is spent trying to figure out what we can offer local businesses that will help them sell more of whatever it is they sell.
But there’s a problem these days. Small businesses, especially small retail businesses like the ones you pass every day, have a Goliath of a competitor. Each year, Goliath lures more and more customers to its virtual store, and the businesses that support our community lose another slice of market share.
The Goliath, quite obviously, is Amazon, and the company is making an impact on our way of life that very few completely understand.
Consider this: Back in the era of the Industrial Revolution, the wealthiest people in the world all created something tangible. John Rockefeller produced oil. Henry Ford made cars. George Washington Vanderbilt built railroads. Andrew Carnegie produced steel.
If you look at the list of today’s wealthiest people in America, you’ll find something completely different. No. 1 on the list, obviously, is Jeff Bezos ($109 billion), the founder of Amazon. No. 4 is Mark Zuckerberg ($77.5 billion) of Facebook fame. No. 5 is Larry Page ($54.9 billion), a co-founder of Google. And No. 7 is Sergy Brin ($53.6 billion), the other co-founder of Google.
Besides having the net worth of the entire country of Ireland, what’s most fascinating to me is that none of these billionaires have created a single, durable good. Each of them has created code that moves goods and information around.
Maybe that’s not as big a deal as I make it out to be, but when the largest companies in our country are re-sellers of products they don’t create, aren’t they solely reliant on others for their value?
If no one listed products on Amazon, would Amazon still be in business?
If no one posted to Facebook, would Zuckerberg be sitting in front of a Congressional Committee?
If Google had to pay to have access to information from other companies, would they be any better off than some low-rent basement dweller trying to code a new research app?
The reality, of course, is these three companies were the best at what they did, and there’s no stopping them now. And you can’t blame Bezos, Zuckerberg, Page or Brin for being smarter than the rest of us.
I’m certainly not angry about their success; I am sad at the impact it has on the local producers and sellers of products. I’m sad every time I see another local store that closes because potential buyers went to their computers instead of their neighborhood business to buy a product.
My expectation is that Amazon continues to grow until government splits them into a few companies. Facebook will evolve into another business in the next decade because they’re going to start charging for the service and because young people don’t have Facebook pages.
And Google will always be Google, and they’ll start new companies that make them even wealthier.
Meanwhile, what will happen as local businesses start and fail? Eventually, they’ll fail to start. And when that happens, we’re going to lose something incredibly special. We’re going to lose the experience of customer service. We’ll never impulse buy again. We’ll be a neighborhood of warehouses, and we’ll all work in some sort of shipping or delivery service. It probably won’t happen in my lifetime, but how many more times will a local business shutter its doors because too many neighbors shopped on their phones instead of feeling products with their hands?
Which is a long way of getting back to this idea, of which only three of my seven readers are still around to read.
Here’s my question, my challenge. If you live in one of our local neighborhoods, would you support an online marketplace – a mini Amazon – that only carried goods from local stores? If there were a website open only to local businesses, and if you could get next-day or two-day delivery, would you shop there before you visited Goliath?
One of the things I love about our neighborhoods is that we try to support each other. But with two-income families almost necessary, and with ever-expanding demands on our time, there’s no going back to the days when all our shopping was done pulling into parking lots.
If we’re going to continue as a community that loves its local stores, we must find a way to support our local business owners. And if we really are headed toward the era when we only buy online, could we still support local businesses by creating a virtual marketplace where they have a fighter’s chance?
This isn’t rhetorical. This is a real question, and I’d love your feedback.