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| Name | Bankrupted company: Why did Blockbuster fail? |
| Video Uploader | Video From Easy Marketing |
| Upload Date | This Video Uploaded At 24-10-2022 19:19:15 |
| Video Discription | BlockBuster, one of the biggest companies at one time, fell victim to a series of bad decisions made over time.Before the reasons that led to the bankruptcy of BlockBuster, let's get to know the company more closely. BlockBuster was founded by David Cook in 1985 and was one of the largest and most successful companies of its time, engaged in the rental of movies, video games, tapes and DVDs. In particular, the company, which had its heyday in the late 1990s and early 2000s, began to experience a severe decline after 2004. With more than 9,000 stores in 25 different countries in 2004, more than 84,000 employees, and a valuation of nearly $6 billion, this giant company has only 1 store and 3 employees as of the latest 2019 data. But what were the reasons that led to the bankruptcy of BlockBuster? Many people think of the Netflix platform as the reason for the company's bankruptcy, but let's get a more accurate result by examining the history of the company and the decisions it made. Exactly 24 years ago, in 1998, Warner Bros., the maker of hundreds of popular movies like Batman, Superman, Harry Potter, and more, offered to sell DVDs of its movies at BlockBuster before other stores. But John Antioco, the CEO of BlockBuster at the time, rejected this huge offer, considering that only a small percentage of people still play DVDs, and as a result, one of the main competitors, Walmart, took advantage of the opportunity to buy and sell DVDs at a cheaper price. Yes, at a cheaper price. But when they sold DVDs cheaply, they made huge profits from the DVD-players and TVs they sold alongside. BlockBuster's mistake cost both themselves and Netflix a lot. On top of that, Netflix, not as popular as it is now, offered to join forces by selling themselves to BlockBuster for $50 million, but John Antioco just laughed at the offer and agreed with a company called Enron to create their own Netflix-like online DVD rental platform. But shortly after this deal, Enron went bankrupt, and as a result, BlockBuster's millions went to waste. 2 years later in 2002, seeing Netflix booming, BlockBuster tried again to create the same type of platform and this time it was successful, thus gaining millions of users in a short period of time. However, this rapid growth stopped at one point, as Netflix provided better service in online DVD rentals. BlockBuster, despite having a number of chances, could not turn them into an advantage. For example, even though the company has stores close to 90 percent of the American population, online rentals and in-store sales were not linked. Specifically, buyers had to return mailed DVDs by mail. However, it might be more convenient for people to go to the nearest store and return it. In addition, to keep up with the competition, those who rented DVDs online from BlockBuster could get a second one for free when they returned the DVD. In addition, he canceled the fines applied for the timely return of the rented products and won the favor of the buyers by using a different method. But this time, franchise problems plagued BlockBuster. Because of the freedom given to franchisees, they could impose whatever decision they wanted on prices and fines. Then things got worse when people couldn't see those proposals that won them sympathy. After all this, the last killing blow was delivered by the next CEO of the company, James Keyes. He also turned down another lucrative offer from Netflix during his tenure at BlockBuster. Netflix was offering that DVD rentals from them could be returned at BlockBuster stores. This offer would increase both Netflix's availability and traffic to BlockBuster stores, which would positively impact BlockBuster's sales. In addition, James Keyes has raised the price of subscriptions for online rentals and even canceled the second-free campaign for those who rent the first. After all these events, in 2010, the once rival BlockBuster officially declared bankruptcy, and the remaining 1,700 stores were acquired by a company called Dish Network. Not long after that, in 2013, stores operating under the Dish Network name also went bankrupt, and the last company-affiliated store closed in 2014. Currently, there is only 1 store operated by a franchisee in Bend, America under the name BlockBuster. The reason for this failure was a series of wrong decisions made by the BlockBuster board, not Netflix or other companies. #marketing #blockbuster Contact for partnership: support@easybusinessschool.org The program we used to make the animated video: https://tidd.ly/3Y5siMb [-360tud6X9M] |
| Category | Education |
| Tags | marketing | set own business | easy marketing | blockbuster | blockbuster meaning | blockbuster stock | blockbuster netflix | blockbuster definition | blockbuster video | blockbuster company | blockbuster failure |
