Does Your Business Risk Being Netflixed?
Netflix Inc., the largest U.S. mail- order movie-rental service, reported they added 1 million subscribers last quarter.
Add that to the ~13 million subscribers they already have and you’re talking real numbers.
Only a few short years ago everyone went to the video store to get their movies. Blockbuster recently annouced their plans to close up to 960 stores nationwide by the end of 2010.
Yep, the game has changed. But what does that have to do with your business?
Does Your Business Risk Being Netflixed?
Back in Blockbuster’s heyday they were a video force to be reckoned with.
Not so long ago if you lived in or around a major city, chances were you went to a Blockbuster to get your rentals.
Then the Internet got a little quicker, and doing stuff online became easier, and then Netflix came along and said “order online – larger selection – we ship free both ways – you don’t pay late fees” and people said “hmm, for the price of two rentals at Blockbuster I can get a month subscription to Netflix and get more movies for less – I’m in”.
And so, becuase of this Blockbuster is left scrambling to catch up to the forward thinking Netflix, and is slowly going the way of the Dinosaur.
Today is Tomorrow’s Not So Long Ago
Not so long ago if you wanted shoes you went to a big box retailer, tried to find something you liked, hoped they had your size and purchased.
Then Zappos.com came along, and destroyed every barrier to buying shoes online.
“It takes to long to get something you order online” – Enter next day shipping
“Getting it quick cost to much” – Make that next day shipping free
“Well if it doesn’t fit what do I do?” – How bout you send it back to us for free too?
“Okay, but what if something goes wrong, those online places don’t give much customer support?” – Zappos is now the customer service standard by which all online retailers are held.
Not so long ago phone had cords and you kept them in your house.
Not so long ago you went inside the bank to make a withdrawal.
Not so long ago I didn’t see the need for a laptop computer.
Not so long ago…
What’s Our Point Here?
Every small business owner should be asking themselves if they are at risk of being Netflixed, or Zappo’ed.
Is the product or service you’re selling – or the way in which you’re selling it – going to be tomorrow’s “not so long ago”?
It doesn’t have to be. But you’ll need to start thinking about what the next curve is for your business. Don’t let somebody else see where your business is heading before you do.
That’s what Blockbuster did and now they’re playing catch up.
That’s what the shoe stores did and now they’re playing catch up.
That’s what the phone companies did and now they’re playing catch up.
Ketchup is a condiment, not a business model.
This is a topic of debate in many businesses today. Blockbuster’s attitude that Netflix was a passing fad is what caused Blockbuster to become outdated. Changes in the market place can happen seemingly overnight, but this could be misleading. The most dangerous are small changes that occur overtime. When you finally realizes that you are behind the curve, it can be all over for your business. This is where becoming a part of the community can make a difference. Understanding customers in an analytical way is key to seeing trends in your market place. Not listening to your customers is no longer an option, even if you have an online business. Zappos teaches us that lesson. Being engaged, listening, and never underestimating competition will help a business stay in front of the curve. Not to mention that you should try to be an innovator.
@Rob
You hit right on the main point “When you finally realize that you are behind the curve, it can be all over for your business”. Too often we’re looking back at what businesses are chasing us, and not looking forward at what type of business could “Zappo” us tomorrow.
Matt
Small business owners have an advantage over the likes of the Blockbusters of this world, in that they can (and should) be more dynamic and innovative. In short small businesses should be the Zappo’s not the Blockbusters and running rings around their big, slow, bureaucratic competitors.