Search
  • Pav Chahal

How to avoid being another "Blockbuster"


In these past few years or so I have started to notice a buzzword that is starting to be commonly used in a lot of businesses, the word "digital transformation". A lot of companies are looking to be transformed digitally so that they can continue to grow and thrive in their current world as well as in the digital arena. It is also important these days to be socially 'out there,' interact with customers, be aware of new technologies/trends and also be kept on the bandwagon of not losing the original ethos of the company. So how does a company keep their essence and also transition into the digital world? I am going to start by giving an example of a company that didn't transition into the digital world, when they were ideally positioned to be - most probably - in the best position to do that.

The example I am referring to is the video rental company Blockbusters - remember them?. Apparently at their peak (https://en.wikipedia.org/wiki/Blockbuster_LLC) in 2004 they had nearly 60,000 employees and over 9,000 Stores. So what went wrong? In simple terms it lay with not looking at what opportunities (technology, user behaviour and trends) were happening around them, and in a way taking a risk.

As a big movie fan I used to love going to Blockbusters on a weekly basis, and loved the convenience of having the video dropbox to return the movies (I had a car so it was easy for me to do that). I do remember walking through a blockbusters store during my university days and wondering how people go about picking the movies (the natural ethnographer in me was always doing this, and I still do observe people and their behaviour), and also watching people pretend to not walk in certain movie category aisles within the stores. I then remember wondering about a service that could be provided that helped people to explore movie titles (ones that they wanted to keep private) so the concept of a "search movies" and a "dvd-by-mail" came to mind. I also thought about the online world, and felt that this would happen when technology finally caught up (and so it did).

So going back to Blockbuster, do you know what happened to them? Well as Netflix and Redbox took off, Blockbuster obviously lost significant business and in September 2010 they filed for bankruptcy. If you take a look on wikipedia it tells you what happened to the brand post that. And honestly it's a sad story. It really is a shame as I'm also wondering why during the uprising of Netflix they didn't transition to the online world as well, or even at an earlier time, to the DVD-by-mail option. Yes they had their "drop-off" letterboxes, but here they were making the customer do all the work. It's these little awareness of human behaviour and needs - and how they interact with your business - that can really help create ideas of a potentially valuable solution.

Netflix is a prime example of a company that did transition. In 1998 they started as an American DVD-by-Mail service (note: this was one way people didn't need to be seen at video store aisles, and conveniently be sent videos in the post! Big tick that they are meeting an important user behaviour). But an even bigger tick is for the fact they moved to the online streaming world (in 2007). They obviously kept abreast of technology, business and user needs. And more importantly took that risk as they believed in what they uncovered.

The only danger I feel is that a company who is looking to transition looks at what is trending out there, and then attempts to recreate that into their own business, without truly understanding whether it is of (user) benefit. I've seen a lot of companies do this. They will look at what is trending and see how they can incorporate that trend into their business. The key is to look at your customers and where your business is today, and create - sort of - a digital map of the ideal future based on user needs, behaviours, trends and technology.

I do think that each business needs a percentage allocated to "digital transformation" to help transition the business into the future and yet also work with what needs to be done today - that is commonly know as BAU (Business as usual).

This is where hiring - someone like me - can be hugely beneficial (come on, I am allowed a mini plug here! <smiling>). It's about understanding the opportunities that are open to your business, based on understand your users, as well as business and technology. Yet it's also about being truthful about where in the past things have not worked, and equally where they have worked. Mapping all of this out can really help create new ideas, and visions, and then you can work out how you can move into that arena.

Why not spend that little bit of research, whats trending, what your users are doing, and whats happening with technology. That way you develop a Digital Business road map that looks at creating and putting through a more flexible, iterative transformation in a series of small changes. That way when things around the business change, the flexibility is also there to take that on board. Lastly don't forget that all of this will also have to take into consideration organisational change. Again it's about transitioning in the right ways, taking the risks and simply not standing still.

RIP Blockbuster.


31 views

Recent Posts

See All

End of year - Reflection

Professionally it's been a fascinating year for me and one where I have predominately spent on contract at Barclays PLC. I've enjoyed my time here working on software and intranet interfaces as well a

Sorry, to the lack of posts!

Post my first blog it has literally got busy, busy, busy. I am going to put a plan together so that I better schedule posts here. These past 6 months have suddenly got very, very busy for me, and I c