Blockbuster vs Netflix: Innovate to survive
Before Netflix, Blockbuster used to lead the entertainment market by renting movies and games.
In the beginning, Blockbuster rented the films with late fees. And Netflix was a rental company with home delivery, without charging fines and customers could return the movies whenever they wanted.
It seemed impossible to overcome Blockbuster’s success at that time. So in 2000, Netflix’s CEO Reed Hastings proposed to John Antioco, CEO of Blockbuster, to sell Netflix for $50 million, but the condition was that Netflix team would work for the online version of Blockbuster.
Blackbuster’s CEO didn’t accept the deal. But the future was on the internet, making the company go bankrupt a while later.
Innovation made Netflix take over the world
Netflix bet on the streaming service with the arrival of DVDs in 2008. People would no longer need to go in person to rent a movie. They created a platform with subscription plans that allows them to watch movies and series instantly on the computer.
Ten years after Reed’s proposal, Netflix was already making deals with giants like Sony, Paramount, Lionsgate and Disney, while Blockbuster declared bankruptcy with a debt close to one billion dollars. That year, Netflix already registered 16 million subscribers.
Netflix followed technological changes, and implemented strategies of the Digital Age — the company grew worldwide using investments in technologies and practices focused on the client, ensuring good experiences.
Netflix has reinvented itself through digital transformation.
Digital transformation is important
Innovate the business model always paying attention to market changes. You must take advantage of new technologies to always remain strong in the market and standing out from the competition.
Netflix vs Blockbuster’s story shows it’s possible to compete in the market with the biggest competitor and achieve victory and success.
With the new needs of the internet, companies must create the ideal strategy to achieve their goals. What about your company, is it already in the digital age?
