Retail religion

IN THE 1980s and 1990s no visit to Southern California was complete without a trip to Robert Schuller’s Crystal Cathedral in Garden Grove, a short drive from Disneyland. It was the most striking of a new crop of megachurches that were springing up across America. Twelve storeys high and made from 10,000 panes of glass, it made worshippers feel they were praying in the Orange county sun. Mr Schuller was the most successful of a new breed of televangelists who realised that technology was their friend. He may have lacked Jimmy Swaggart’s swagger and Jerry Falwell’s political clout. But he possessed what passed in that world for gravitas. Dressed in flowing, purple robes Dr Schuller, as he always called himself, preached the Word not just to the 3,000-strong congregation (with another 3,000 waiting for the second shift) but also to millions watching on television.

Mr Schuller, who died on April 2nd, was the leading example of a very American breed of businessperson: the pastorpreneur. He succeeded by applying the principles of business to religion. However, in his later years, a religious empire that had grown huge by embracing economies of scale and customer focus fell victim to two familiar causes of business failure: poor succession planning, and a failure to react to dynamic new competitors.

He had started preaching at the age of five, to his father’s cows; he opened his first ministry in 1955, in a drive-in cinema in Los Angeles. His wife played an organ that was hitched to the back of their car. Mr Schuller preached from the roof of a hot-dog stand. The audience sat in their cars and listened via tiny speakers. The church’s motto was perfectly tailored to the emerging American Autopia: “Come as you are, pray in the family car.”

As his audience grew and the tithes rolled in, Mr Schuller abandoned his hot-dog stand. In 1961 he built a bricks-and-mortar “walk-in, drive-in” church. In 1970 he began broadcasting his “Hour of Power”. In 1980, his flock still swelling, he built his $20m Crystal Cathedral. He hosted the “Hour of Power” until 2010, its audience peaking at 20m viewers in about 180 countries.

The key to his success was his relentless customer focus. In a 1983 interview with the Los Angeles Times he described his Crystal Cathedral as a “22-acre shopping centre for Jesus Christ” and called himself a “religious retailer”. Just as a good shopping centre should provide everything from groceries to shoes, so a good megachurch should provide everything from Bible studies to dance classes, he argued; and just as a retailer should know his customer, so a pastorpreneur should know his flock. He conducted regular surveys of his audience and, more important, the people he wasn’t reaching. (“There are still a heck of a lot of people out there overdosing, blowing their brains out and getting herpes.”) He recognised that the precondition for success in retailing of any kind, spiritual or secular, was good parking.

His sermons also conformed to his belief in giving the audience what they wanted. He recognised that the fire-and-brimstone preaching of the old Evangelicals had limited appeal in a world of McDonald’s and Disneyland. He preached a different Protestantism, that owed as much to Norman Vincent Peale, the author of “The Power of Positive Thinking”, as it did to Martin Luther. “The classical error of historical Christianity is that we have never started with the value of the person,” he wrote in his book, “Self-Esteem: The New Reformation”.

He added three other elements into this customer-friendly formula. Economies of scale helped him reduce the costs of reaching a bigger audience; the “Hour of Power” made him the world’s most widely watched preacher. He knew that the first rule of marketing is to hold people’s attention; so he built his cathedral from glass, installed one of the best organs in the world and invited a constant stream of celebrities, including presidents and film stars. And he understood cross-promotion: his bestselling books promoted his church services, and vice versa.

Mr Schuller’s seminars on church leadership attracted crowds of would-be pastorpreneurs who paid handsomely for his insights. But in his obsession with positive thinking he ignored the problem of failure. This proved an expensive oversight: in the last decade of his life, his virtuous circle of expansion and hype turned vicious. The problems had accumulated for years. His audience had turned grey with him. The field had become crowded with ever more vigorous vicars, particularly from emerging economies like Brazil. His family were extracting too much rent from the business: about 20 relatives were employed by his ministry at some point or other. But the entire edifice was brought down by the oldest problem of family enterprises: a botched succession. He installed his son as chosen successor in 2006 but removed him two years later, citing a “lack of shared vision”, eventually replacing him with his oldest daughters.

Selling out to the competition

In 2010 Crystal Cathedral Ministries filed for bankruptcy, with debts of more than $43m. In 2012 Mr Schuller sold his Crystal Cathedral to the Roman Catholic diocese of Orange for $57.5m. Mr Schuller even sued his former ministry for $5m for copyright infringement and breach of contract—he was awarded a lesser sum. The Schuller brand had become thoroughly toxic.

Mr Schuller’s downfall offers a true-life parable for the denizens of Silicon Valley. Tech titans and televangelists may breathe the same Californian air, but they see themselves as belonging to different mental universes. Yet there are more similarities between the two tribes than either would care to admit. Both are marinated in positive thinking. Both are led by strong-willed founders who seek world domination. And both must constantly be on guard against newer, nimbler rivals. Mr Schuller’s business empire collapsed, in part, because he failed to think about how to adapt it to a changing and more crowded market. The same may one day be true of some of the Valley’s booming tech empires.