So What’s Up with the Big Boys?

Fire Sales on advertising; GetMarried’s seeming fall from grace; the Knot’s numbers being questioned, Vera moving to David’s, eHarmony buying up Wedding Bee and jumping on the Wedding Wire train, What the heck is going on here?

As you know, we run the syndicated feed for eWednews.com on this site. More than that, its publisher/editor Paul Panonne is a friend and associate. As you might imagine, we have some fairly deep conversations about the industry.  I follow both his feed and our conversations and try to spot the trends and make sense of it all. Here is my take on the above news.

There was some tremendous growth among the big players starting about 5 years ago. A good bit of that was fueled by angel investors and venture capitalists spotting the wedding industry as a market with the potential for unimpeded growth.  The numbers were there five years ago to back up that assumption.  That was, of course, before the bottom fell out of the housing market, nearly crippling the US economy.

When you or I run our business we have to answer to only ourselves. When you grow to the point where you go public (theKnot), or take on VCs or Angel investor you now have the person holding the purse strings breathing down your neck. These are purely investors and have no more understanding or compassion for your brides (or your business) than they do for a coal mine they invest in. If it stops becoming as profitable as they think it should be, your neck is on the chopping block. Rewatch that classic movie Wall Street if you don’t know what I mean.

I warned you back in 2006 that we were in for some rocky times(Here & Here); little did I know that it would take the form it did.

Here is what I see happening next.

You can expect some of the major players to crumble now that their investors are feeling the heat. I don’t know which ones but having a Fire Sale on advertising is never a good sign. You can look for others to regroup and try to figure out who their money really comes from; (Here is a clue to the Knot, your advertisers help pay the bills, not your brides. Without the brides you don’t have any advertisers. Don’t forget the shareholders breathing down your neck. Can you say “Rock and a hard place”?)

Others like David’s are looking for the cachet that come with a high end label and some are willing to dilute their brand just to move merchandise.

Actually, from the perspective of the small business owner, it’s kind of fun to watch. We are all scrambling with a couple of zeros after our name; they are doing it with a whole bunch more. Ouch.

I’ll keep watching and analyzing.

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