Blockbuster lost sight of who its customers were in its delayed attempt to keep up with the changing video rental landscape. Any business owner could learn a lesson or two from Blockbuster’s failure in order to avoid the same fate. Here’s what to take away from Netflix’s endeavours to avoid a Blockbuster flop.
A business’s focus is on increasing sales and market share to remain profitable, but to properly achieve both of those goals, it requires happy, loyal customers who continue purchasing products or services. Customer centricity is a business approach that emphasizes the factors necessary for creating a positive customer experience and making business decisions that leave the end user happy.
You can use this approach in every part of the customer’s journey and in your company’s line of thought. Optimize your processes and solutions to create the best customer experience. Netflix did this when it abandoned its rental service and switched purely to digital streaming, and as a result, it retained its customers. Customers stick with a business that keeps their priorities in mind.
It’s not enough to just provide a service: Customers need to love your product. They should be ecstatic about receiving whatever it is you’re offering them. In Blockbuster’s case, going into a store to pick a movie wasn’t what made consumers happy—watching the same movie without having to leave the couch was.
Even Netflix’s stock dropped in the U.S. recession, but the company salvaged itself. How? The executives listened to their customers. While Blockbuster forged ahead on the well-trodden path, Netflix reinvented itself using its customer feedback and user-friendly smart services. The company recognized the unique needs of all of its individual customers; even though all your customers have your brand in common, not all of them are the same.
Netflix’s streaming service made the user an active recipient of the product: They get to choose what they want to view. Blockbuster lacked this customer knowledge, which Netflix acknowledged, and this gave Netflix the competitive upper hand. Blockbuster continued using its brick-and-mortar stores while Netflix emphasized customer input in creating its new strategy. Customers appreciate a business that values what they have to say. Paying attention to your customers’ needs keeps you profitable in the long run.
Netflix collected data about customers to make changes, asking its subscribers for just the right amount of information and giving them just enough context so they didn’t feel overwhelmed. Blockbuster ignored its audience and didn’t grow with the evolving market.
In today’s digital era, shopping online is the norm, whether it’s through chatbots on websites or deals through social networks. Failing to adapt to these buying methods makes it hard for customers to know who you are, and if they can’t identify you, they’re unlikely to buy your product or subscribe to your service. As a result, you lose sales.
Social media can help improve your company’s reputation in multiple ways. These platforms combine a variety of connected factors to create a structure of invisible connections. Even though you can’t see them, those connections play a part in reaching business objectives.
When every business is competing against each other, you need to stay ahead of the pack. Blockbuster continued with its same selling strategy, not paying attention to the fact that customers weren’t shopping this way any longer.
We previously discussed that a key aspect of customer centricity means showing you care. Emphasize this in your current channels and marketing strategies. Engage with your customer. If they give you a shout out on social media, respond with a thank you.
Customer centricity shouldn’t feel foreign. Make it a core part of your business strategy for future success.