“When we are ready to flip the market to online, we will do so. We own consumer film distribution and with our brand, the customer will wait for us.”
That was the response I received from the senior blockbuster video executive seated at the table across from me. After a series of meetings with lower execs, I’d flown all the way from London to Dallas-Fort Worth, their corporate headquarters, to meet with the higher-ups and pitch the urgency of expanding an already successful brick and mortar business model to embrace Video On Demand. Back in ’99 I was an account manager at IBM and one of our biggest clients happened to be Blockbuster Video, who just might have been the perfect fit for IBM’s new pioneering VOD streaming service.
I walked away from that meeting feeling that I had failed to help them see the future. They also may have needed it the most.
In 2004 Blockbuster had over 60,000 employees and 9,000 stores worldwide. They were valued at $5 billion.
10 years later, in January 2014, the last remaining Blockbuster Video closed its doors for good.
As it turns out, I was not alone in my attempts to help Blockbuster save their business. In 1997, Reed Hastings, a customer of Blockbuster, rented ‘Apollo 13’. He returned the video very late and was charged an unprecedented $40 in late fees; apparently, he’d gotten lost somewhere along the way back and had to sling shot his way `round the moon in order to safely return the movie home. In his frustration, he created a DVD subscription service with no late fees.
Just 3 years later in 2000, Reed’s small business had grown exponentially and he offered to let Blockbuster purchase it for $50 million (just a tad higher than his late fees for Apollo 13). Much like with me, they declined the offer, and Reed continued to grow his little company.
That little company was called “Netflix.”
To add insult to injury, Blockbuster generated $800 million in late fees that same year. They literally could have bought Netflix and owned the VOD market for a 16th of the revenue from their late fees.
Blockbuster believed they were in control of the consumers buying process and didn’t see changing consumer trends. On the other hand, Netflix built a business delivering to customers’ expectations. In simple terms, Blockbuster expected the customer to wait for them to catch up, whereas Netflix anticipated and met the demands of a new kind of customer.
Evolve with the Expectations of Your Customer
The expectations of our customers are ever evolving. We mustn’t simply rest on our laurels; we must consistently seek to re-evaluate the needs of our clients within a fluid marketplace.
Just as I often say “no is only a no today,” the reverse is also true: a “yes” today may turn into a “no” later on down the line, if the needs of the customer are not consistently re-evaluated and updated with the most up-to-date marketplace trends.
When evaluating your brand, ask not “What have I done?” Ask, “What can I do better?” When creating a business, any entrepreneur seeks to solve a problem. Ask yourself: “is my solution still relevant?”
Close the Sale in Your Client’s Best Interest
As a young salesperson, I failed Blockbuster Video. Sure, they were overconfident and hubris played a part. But it was up to me to show them the value and the urgency in pioneering a video on demand service. To this day, I feel as though I could have done more.
Many young entrepreneurs fall into the trap of feeling like sales is pushing something on someone; in actuality, had I been able to provide a convincing argument for the urgency at hand, Blockbuster Video would still be a multi-billion dollar company. I could have had a hand in saving 60,000 jobs, including that of the executive I mentioned at the top of this post. When you’re afraid of asking for a sale or overcoming objections because you don’t want to seem too pushy, remember that in order to be a good salesperson you must always have your client’s best interests in mind.
As sales professionals, we’re here for one reason: to add value to another person’s life. Do that and you’ll never be ashamed of asking for a sale ever again.