Most of us can remember the anticipation of entering a Blockbuster video, seeking a good flick and some snacks for a movie night. However, not even the power of nostalgia could protect the video rental company from going under. Once a staple of most towns in the U.S, there is currently only one more Blockbuster remaining.
Founded in 1982 and reaching its peak profitability in 2004, Blockbuster was the leading powerhouse in video rental for a long time. However, with the introduction of streaming services like Netflix and cheaper DVD rental like Redbox, Blockbuster went under.
They filed for bankruptcy in 2010 and announced all stores would inevitably start closing in 2013. Since then, it’s been a slow march towards the inevitable collapse of the once-thriving business.
Only one store endures in Bend, Oregon. It’s become a tourist hotspot, where people travel to take selfies and check out the film selections. With all the fanfare and outcry for stores closing, it’s surprising that it has come to this.
“We hear this every time we close a store: ‘We love it; we’re sad,’” says Alan Payne, a manager of the now-closed Alaskan stores. “All they remember is some fondness for coming to the store. Not why they haven’t been coming as much. Well, now they can’t go anymore.”
There are a few lessons businesses can learn here. Blockbuster ignored its strengths in favor of competition. By trying to modernize and compete with Redbox and Netflix, it ignored the real reason people loved Blockbuster. Here are some ways to avoid a similar business disaster.
Don’t try to compete with everyone
No matter how good your business is, there are hundreds of other services out there competing for your client base.
To stand out from the crowd, your business needs a unique POD or point of difference. “Having a unique POD will help set you apart from the hundreds of other businesses that do what you do and forge a stronger connection with your target customers,” we’ve reported.
Here’s the biggest area where Blockbuster went astray. Their POD was simple; renting a movie from Blockbuster meant you got to interact with people.
Blockbuster wasn’t the fastest service option. It wasn’t instant, it required travelling to a store, and it didn’t get the newest releases instantly, like Netflix or Hulu.
It did, however, have a friendly staff that could offer recommendations and start a conversation with you.
Person to person interaction and customer service is invaluable in business. A survey by Genesys reported that the majority of polled customers cited better human service as their top priority. This was more important to most customers than the quality of the product, fast reaction time, or having multiple options for support.
Your business doesn’t have to do it all. Just make sure you excel at your POD, and your clients will remain loyal.
Know Your Audience
Speaking of clients, it’s crucial that you know your audience. This is a crucial factor in figuring out that POD.
Inc.com has a great guide to defining your audience. They say, “Small businesses can effectively compete with large companies by targeting a niche market.” Make sure you know what your ideal clients want and need from your business!
Blockbuster customers wanted a place to interact, the option to browse in person, and supportive staff. The company began going under because of other markets and conveniences, sure, but they sped the process up by ignoring what customers wanted.
Avoid this by asking for feedback. If your company is struggling, reach out to your audience and ask them what THEY want. You might just stumble across your next great idea.
It will also make them feel included in the business, which builds loyalty. Working on community engagement is a good way to make sure you have a support net of loyal clients. You can do this through social media, with polls, interactive posts, and email campaigns asking for reviews.
People Need People
It’s simple: people need people. That’s one of the reasons Nexa Receptionists is an industry leader; by providing businesses with live voice support 24/7/365, customers will never have to deal with a phone tree or automated answer.
Even as automated support options are on the rise, never forget that people need people. Give your customers what they need, and watch your business thrive.
You can avoid a business disaster like Blockbuster. Define your POD, listen to your audience, and give your customers what they need: a real person and a genuine connection.