Electric Cars and Fallen Giants: Marketing Lessons from the Fates of Time Warner, AOL and GM
The tenth anniversary of the ill-fated Time Warner-AOL merger came and went this week. It was on January 10, 2000 that the old media stalwart and the new media darling came together in marriage. The union was a highly celebrated realization of the long-anticipated digital revolution.
We’ve since traveled 10 years down the road. The couple that once shouldered the hopes of the digital soothsayers has divorced. Though, by the time the final nail was driven into the coffin, the fortunes of the pair had spent the previous decade in a nose dive.
The New York Times this week published a retrospective on the Time Warner-AOL merger that’s a must-read for anyone in the digital space. AOL’s co-founder, Stephen Case, was interviewed for the piece. Describing the merger announcement, Case said:
“It was a moment of achievement after a decade or in some cases, in our case two decades, of trying to prove that this concept had real merit, suddenly the Internet had arrived and we’re beginning this new century with a combination of these two great companies.”
So what went wrong?
In 1999, the year before Time Warner and AOL announced their historic partnership, another giant, this one of the auto industry, effectively split with what was once considered a transformative technology: the electric car.
In the documentary Who Killed the Electric Car?, a theory is posed: not only did oil companies object to electric cars — a technology that could dampen demand for their product — but car companies were also resisting the change.
Earlier this week Detroit welcomed the annual North American International Auto Show once again. Guess what technology is playing heavily into the line-up of auto makers across the globe? Electric cars, of course. And this time around, they’re more efficient, more in vogue, and sexier than ever.
What’s so different this time around?
Learning from the Past
The stories of the incompatible couple and the mismanaged motor have a lot more in common than you might think. They both hold lessons for businesses doing business online today.
There’s a fork in the winding road.
In the case of the electric car’s temporary demise and subsequent reprise, we find that when it comes to the wave of the future, there’s no stopping it. Businesses following traditional business models have tried to avoid the Web, have tried to maintain the monologue beloved by the ghost of marketing past, and have suffered losses of consumers and reputation alike. Made stubborn by fear, these businesses have tried to squash the need for presence and communication online, but it’s an undeniable force.
When recounting the past around Time Warner and AOL, we see that a culture clash was partly to blame for the soured relationship. In the Times article, Time Warner’s president at the time of the merger, Richard Parsons, said, “I remember saying at a vital board meeting where we approved this, that life was going to be different going forward because they’re very different cultures, but I have to tell you, I underestimated how different.”
Similarly there’s a culture war happening in board rooms and marketing departments across America today. While I’ve read many success stories of the changing of the guard, I read about just as many gaffes and missteps of companies resisting or failing to understand the new media world. Rather than butting heads at the expense of success, business leaders must embrace the new landscape and carve out their company’s place in it.