Blockbuster was founded in 1985 by David Cook. Existing video stores had limited selections, while Blockbusters had over 8,000 tapes to choose from. Blockbuster expanded in no time, becoming one of the world’s largest providers of in-home entertainment.
In 1987, Cook sold part of the business to a group of investors that included Wayne Huizenga, who was the founder of Waste Management Inc. Later that year, Cook left Blockbuster and Huizenga took full control of the company.
Blockbuster underwent major expansions and became America’s leading video chain by 1988 with nearly 400 stores. By the 1990’s, Blockbuster had 1,000 stores, and started expanding operations overseas.
Media giant Viacom, whose brands include MTV and Nickelodeon, acquired Blockbuster in 1994. The Digital Video Disk (DVD) was introduced by 1995, and Netflix was founded in 1997 as an online DVD rental service. Not long after, Amazon launched a video and DVD store. However, that was only the tip of the iceberg. Blockbuster also faced competition from pay-per-view and on-demand movie streaming services, which allowed customers to watch movies instantly from home.
In 2004, Blockbuster split from Viacom. That same year, Blockbuster launched an online DVD rental service to complete with Netflix, but it made no difference. In 2010, Blockbuster filed for Chapter 11 bankruptcy protection. Most Blockbusters stores closed by 2014.
Blockbuster went from being an entertainment giant, to non-existent. Today, there is only one Blockbuster store left, and it is located in Bend, Oregon. You may wonder, what makes this one store so special? The mayor of Bend says that being a small community contributes to it, since they do not have easy access to high-speed internet necessary for content streaming.
So, where did Blockbuster go wrong? Their failure to innovate their business and inability to predict the public’s wants. DVD stores like Blockbusters have almost become a legend. This way of enjoying movies has become almost extinct because of streaming services like Netflix.
Personally, I am unable to remember the last time I watched a movie through a DVD. Streaming movies is much easier and convenient. You do not even have to leave your house! Blockbuster should have seen the uprising of DVDs, Netflix, and Amazon as a call to innovate and catch up with competitors.
Today, everything revolves around the internet and technology. You can even online shop for groceries and have them delivered to your house! Undoubtedly, this must also be applied to marketing.
The average person sees up to 10,000 advertisements per day. Google and Facebook hold the largest share of total U.S. digital ad spending, with 38.6% and 19.9% With so many online users, the failure to promote your business online would be a huge mistake.