The Real Reason Blockbuster Failed Spectacularly

Before the founding of Netflix and Redbox, Blockbuster was the king of the video rental industry in the 90s and early 2000s. But this did not last forever; Blockbuster failed. How could a company that was so established only have one store left worldwide, in Bend, Orengo? How did it get here?

The History of Blockbuster: What to Know

Blockbuster opened its first video rental store in October 1985 in Dallas, Texas. It held a large inventory (8,000 VHS and 2,000 Beta) which gave it a competitive edge over other reputable small-scale stores operating at the time.

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The Founding of Blockbuster: How it happened

David Cook, the founder of Blockbuster, was a database developer and a solutionist who could easily spot a viable business opportunity and capitalize on it.

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Blockbuster Through The Decades: Megahit to Flop Timeline

– From 1988 to 1996 – From 1997 to 2005 – From 2006 to 2010

How Did Blockbuster Make Money?

It entered into agreements with most movie distribution companies on sharing costs and profits related to movie rentals. It would pay the movie distribution company 40% of the rental fees and retain 60%.

So Did Netflix Kill Blockbuster?

It didn’t take Netflix more than a year after its formation to gain a good share of the movie rental market. Employing promotional strategies that proved more effective weakened its main competitor, Blockbuster.

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The Reason Blockbuster Failed

– Failed To Pivot Quickly and Competently – Failed To Create Customer Value – Failed To Restructure – Had a Huge Debt

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