by Rebekah Dehghan, Near Me
In the early 2000’s, the founder of Netflix, Reed Hastings, proposed a partnership to Blockbuster CEO, John Antioco, to fully run Blockbuster’s brand online and have the video giant promote Netflix at their on-site locations.
Mocked and ridiculed by this proposition, Hastings took with him his disruptive model of video rentals. At the time, his model offered a monthly subscription to on-demand video streaming, eliminating late fees charged to customers, which Blockbuster heavily relied on as part of it’s major profit sector.
In 2010, Blockbuster declared bankruptcy, an avoidable outcome had they partnered with Netflix at the time. Netflix, now a $28 billion dollar company, dominates the video rental industry and is worth about ten times what Blockbuster was worth. The flaws in Blockbuster’s model could easily have been filled by Netflix’s proposition, which could have prevented their decline.
“Enterprising organizations either take steps toward innovation or risk getting left behind.”-Brian Solis.
Solis recommends businesses subject to high-profile digital Darwinism, to innovate as much as possible. Defined as the evolution of society and technology and its impact on behavior, expectations and customs, digital Darwinism can either make or break your business model.
‘To survive and thrive, businesses must create a culture of innovation or at the least, invest in innovation practices and communities.”
Forget about quarterly performance and focus on long term gains, says Solis. Focus on creating an innovation center for your business to further explore and understand the evolving digital consumer. Innovation centers serve as a means to further advance implementation of new ideas, talent, encourage employee engagement and form partnerships with startups.
An example of innovation is visible through non-traditional business models like those of Uber and Lyft, which have completely disrupted the traditional model that is the taxi industry.
“Innovation represents an intentional act of partnering with people and companies that offer new insights, expertise, and capabilities. It also represents the importance of looking outside traditional business models to establish a footprint in communities with the sole purpose of inventing and testing new products and markets.”
Be in the know of the latest technologies and understand your consumer’s behavior, expectations, wants and needs. The main idea here is to innovate. Remaining idle and complacent with your business model while other businesses are innovating to remain relevant is the reason Blockbuster was hit so hard. If your business is feeling disrupted, partnering with other businesses such as start ups or larger scale companies may be the answer for success. Bottom line: if you’re disrupting, you’re innovating.
Read the full article here.