The Blockbuster Meeting That Never Was: A Hollywood Tale of Missed Opportunities

Scene: Blockbuster Headquarters, Year 2000

Characters:

• Sarah, Blockbuster’s VP of Strategic Initiatives
• Mark, Blockbuster’s Chief Financial Officer

Sarah: Mark, have you heard of this DVD-by-mail service called Netflix? They approached us with an interesting proposition.

Mark: Oh, that small DVD rental service? What are they up to?

Sarah: They want us to buy them for $50 million. They think their model could synergize well with ours.

Mark: $50 million? That’s a considerable amount. What framework can we use to assess this opportunity?

Sarah: We could use SWOT Analysis to evaluate our strengths, weaknesses, opportunities, and threats.

Mark: True, let’s see. Our strength is our physical presence and brand. Their strength is a disruptive model. Our weakness is not having an online presence. Their weakness is not having the brand recognition we do.

Sarah: Exactly, now for opportunities. Buying Netflix would give us an online footprint and a new business model. The threat would be the cost and uncertainty of adopting a new model.

Mark: Hmm, what about using the ‘Five Whys’ framework to dig deeper into why they’ve approached us?

Sarah: Good idea. Why one: They’re still a small player and probably need the financial muscle. Why two: Their logistics for DVD delivery might be a challenge at scale, which we can solve. Why three: They don’t have a brand presence. Why four: They anticipate the online shift. Why five: They might see the future in streaming rather than physical rentals.

Mark: That fifth why is intriguing but risky. Streaming is still in its infancy, and the technology isn’t mature yet.

Sarah: It’s a calculated risk. Imagine not having to deal with real estate for stores, late fees, and all the overheads that come with it.

Mark: It’s tempting, but it’s also stepping into the unknown. Should we apply the Decision Matrix to finalize?

Sarah: Let’s do it. If we plot Impact against Feasibility, buying Netflix would be high impact but medium feasibility.

Mark: Given that we’re still profitable and leading the market, it seems like a risk we don’t need to take.

Sarah: Well, I hope this won’t be a decision we regret.

Could Blockbuster have turned the tables with the right decision-making frameworks? What do you think? Try solving a real-world case study to hone your decision-making skills. Your future self might thank you for it.

Unleash Your Inner Strategist!
Join the Smarketer Lab Bulletin newsletter and embark on a weekly journey of intriguing case studies that challenge and inspire.