It’s the end of the mall as we know it

The economy is collapsing and it’s partially my fault.

You see, for the past three years I wrote about how happy we were in the Airstream, traveling full-time and living cheap. We didn’t buy much, we didn’t throw much away, and we were happy with less stuff in our lives.   We were free of the trap of consumerism, having less and enjoying life more.   And this was bad.

Bad because apparently, other people listened.   They listened to me, and to Reverend Billy of the Church of Stop Shopping, and the people who advocate “Buy nothing day” the day after Thanksgiving.   They listened to newspapers and TV stations too, who told them that we were all going to consumer hell this year, and consequently people slowed down their shopping and now we’re all in economic quicksand.

I will admit that I was happy during our three years of minimalist living.   Heck, it took that long just to get rid of the surplus stuff we’d acquired during a dozen years of homeownership.   (We’re still using up the last of the hotel soap collection.) In those three years we had less each year than the year before, and we liked it.   Life was simpler, we didn’t have to worry about money nearly as much, and we didn’t waste energy coveting or caring for expensive things.

But now my frugal message has come back to haunt me.   Earlier this year people started to think twice before buying big-ticket items, and the toys went first.   That meant RV sales slowed down.   Manufacturers of RVs started dying (Nu-Wa, National RV, Western RV, Alfa Leisure, Weekend Warrior, Pilgrim International, Travel Supreme, Ameri-Camp).   All the rest have cut back production and laid off staff.

Then the OEMs who supply parts to the RV industry slowed down — things like vent fans and hitches.   And so all the OEMs called me up and said, “Sorry, but things are slow, so we’re canceling our advertising program.”

Ouch. We just lost another one this morning.   It’s very frustrating when you lose customers, even more so when they are long-term customers who love your product but are just hitting hard times.   It’s downright scary when you realize that if too many more of them bail out, you will be next.

So I take it back.   I didn’t mean it.   Buying stuff is really fun, it’s educational, it will make you sexier and improve your skin quality.   Especially if you buy things for your RV.   You need stuff.   Stuff makes the world go round.

Perhaps it’s not all my fault, however.  It’s very popular to blame “the housing market,” as if the houses themselves were somehow at fault.   Apparently those houses were building themselves into a frenzy, and they told people to buy them for ridiculous prices on speculation, and encouraged people to take out huge loans against theoretical value.   Then those darned houses decided not to perform anymore and tipped over the world economy.

At least, that’s what the Administration is claiming.   The banks, the mortgage companies, the developers, the speculators, and all the regulators from the local to federal levels were just victims of this terrible, house-instigated tragedy.  As were those of us who took out huge HELOCs to buy even bigger flat-screen TVs.   At least, that’s the theory.

I have a little trouble buying that, because in many ways the decline of consumerism has been forecastable for a while. “Is the mall dead?” asks Newsweek, citing the fact that 2007 was the first time in 50 years that a new indoor mall didn’t open somewhere in the country.   It’s one of many signs that our society has peaked in its interest in buying stuff.

The idea that we could just endlessly increase our consumption to drive the economy was fun for a while, but in the end it is just another Ponzi scheme doomed to collapse eventually.   In addition to selling stuff, you’ve got to build value, not just keep landfills busy.   Besides, economics aren’t just numbers, they are the result of human behavior, and in this case we have a huge wave of people called Baby Boomers who are changing the entire world with their economic clout.   Right now they are retiring, which means they don’t buy big houses as much.

But they are interested in RVs, thankfully, and Boomers drove an enormous wave of RV industry growth from 2001 through 2007.   In total self-interest, I hope that they will resume their profligate RV-buying ways very soon.   We don’t have to worry about RV speculation becoming a plague on the economy later.   Everyone who buys an RV accepts up-front that it will depreciate like a car, and they don’t harbor hopes of selling it at a killer profit next year or taking out a second loan on it to buy a house.   It actually makes a weird kind of sense for Boomers to crack that piggy bank 401-K and go shopping for the travel trailer of their dreams.

Incidentally, I suggest an Airstream. Not only are dealers hungry to sell, but each new Airstream comes with a free one-year subscription to Airstream Life magazine.   See, you’ve already saved $16.   Everyone knows that in America it’s not how much you spent, it’s how much you saved.   So go out there and do me a favor: save me.

Even though you’ll be buying something, in the end your Airstream will return more on your investment than any other thing I can imagine.   You’ll find quality of life that is independent of how much stuff you have.   You’ll discover the joy of simplicity and less obligations.   Like us, you’ll find that once you’re out there on the road, less is more.

But this time, let’s just keep that a secret.

Good news from the economic downturn

There were many reasons we decided to settle into a house without wheels for a while, but one was to get serious about my small business.   For the past three years I’ve juggled work and travel, and it has worked, but I often felt that if I spent more time concentrating on the business, I’d be able to come up with ways to make it run better.   Parking ourselves in a house would yield bonus time that was formerly spent driving and dealing with other overhead associated with travel.

The economic recession has only spurred the need for me to really concentrate on the business.   Niche magazine publishing is not a great way to get wealthy even in the best of times.   With a worldwide economic crisis coupled with a recession in the RV industry, my little magazine is in the crosshairs.

We’ve already been pummeled a bit in 2007.   While people keep subscribing to Airstream Life at the same rate as the previous year, several advertisers have abandoned most or all of their advertising program.   (Talk about a self-defeating strategy.   People are still traveling and using their Airstreams — check any state park or campground for proof.)   Panic is never pretty, and it’s never the right choice.

I’m writing very frankly about this because I think there need to be a few voices to counter the constant negative bombardment in the popular media.   People are getting too caught up in what happened on Wall Street this morning, and forgetting to see the bigger picture.   There are opportunities in a downturn.   In times of war, promotions happen fast.   You can sit on the sidelines and wait for it all to be over or you can get in the game.   However you say it, adopting a position of passive fear or active retrenchment is not going to advance your cause.

The RV industry slowdown has been apparent since the beginning of 2007, so we’ve been working to mitigate the damage all year.   To get the message out, Brett has posted some essays about the value of advertising in a downturn, and privately he’s been counseling our advertisers on ways to intelligently respond to market conditions.   A few have listened, and they seem to be surviving very well.   The companies that understand the value of marketing intelligently when others are running scared will have long-term advantage over their competitors.

Of course, when you sell ads to people, those ads had better work.   So we’ve offered free ad re-designs to our clients, to improve the results they get from their ads.   Those who have taken advantage of that service are reporting great results.   We’ve also been seeking out small businesses with relatively recession-proof business models, as new clients, and we opened up a new — inexpensive — advertising section just for them. We’ve also offered creative ways for our advertisers to be able to afford their ads, including accepting credit cards and product or service trades.

But in the last few weeks, it has become obvious to everyone (even the Commander-in-Chief, the Secretary of the Treasury, and Alan Greenspan, apparently the last three people to figure it out) that the financial crisis is deeper and will last longer than at first expected.   That means my efforts have to go far beyond just shoring up the current clients and seeking new ones.   It’s time to look for efficiencies and cuts that can help sustain us for a long time.

Now, all this might seem enormously depressing.   I admit that at first I was dismayed as well, but then I realized that finding efficiencies in my business could actually be fun.   Like selling, it’s a task that can be a rewarding game. The trick to stretching a recipe is to make the end result taste the same, and that requires creativity, which is the fun part.

So every few days I try to come up with another idea to either save money or increase revenue.   The ideas can range anywhere from sweeping changes to little tiny ones.   It doesn’t matter how big the savings are, just that I keep coming up with new ideas.   I figure that if I keep up the challenge long enough, eventually I’ll find ways to secure Airstream Life against the storm.

For example, a week ago I talked to the guys at the Verizon store and discovered that by combining our two cellular phones (one on Sprint, the other on Verizon) into a single “Family Share” plan, I could cut monthly expense by $50.   That’s a no-brainer, so we did it.   Two weeks ago, we finalized two new products that we can sell through our online web store for the holiday shopping season, so they are on order and should be available by Nov 1.     (We’ll have a cute little Airstream model and some improved aluminum tumblers.)

Other ideas:   We’re reducing complimentary copies sent to advertisers, to cut waste.   We’re using a slightly lighter paper on the magazine cover.   I switched my Amex card from a Gold card with $100 annual fee, to a no-fee card that gives 5% back on fuel purchases.   We’re offering discounts to advertisers who pay for their ads early.   I’m cutting back on travel mileage and rallies (but still planning at least five months of travel in 2009). We’re promoting back issue sales a little more aggressively.   It all helps.

Some ideas actually increase our expenses but will pay off in the long run.   For example, we switched web hosting providers.   The new web host costs $500 per year (compared to $99 per year for the old one).   But the magazine will save money and time overall, because the new host is much more reliable and I won’t have to pay a tech $1,000 per year to fix the problems caused by the cheap-o service we used to use.

I’ve also looked at the long term, and used the “what-if” scenarios to develop strategies to ensure that we’ll be a survivor no matter what happens.   That means having a plan for emergencies, building up savings, reviewing and sometimes renegotiating contracts, etc.   That’s good too.

In the past few months of thinking about this, I’ve come up with literally dozens of small changes that have made the business more profitable.   Some of them are big ideas that will take months or even years to implement.   A lot of them are penny-ante things.   But even if they don’t add up to a lot of financial difference, it has been worth the exercise simply for the improvement in efficiency.   Because I’ve been forced by economic conditions to re-evaluate everything, the business has been improved — tempered by fire, in a sense.

So I am glad for the challenge.   The slump, downturn, recession, or whatever you care to call it, has been a good thing. Once in a while a little bump is good to shake you out of your complacency. Our advertisers will get better service from us, the business will be stronger, and you’ll keep getting Airstream Life magazine.

So never mind what’s happening on Wall Street this week.   Don’t get paranoid and start stocking up on beans, Band-Aids, and bullets.   Plan to thrive on the downturn and you’ll be one of the first folks to smile when things turn around.