A Lesson in Innovation: What We Can Learn from Blockbuster

Blockbuster video stores are closing. It was recently announced that the remaining 300 US stores will close by January. For those of us who can’t remember the last time we’ve walked into a Blockbuster, this is no surprise.

But you wonder. How can a company that once dominated the movie rental market, employed 60,000 people, and had 9,000 retail locations at its peak in 2004 be down to zero less than 10 years later?

While many factors contributed to Blockbuster’s demise, the lack of innovation perhaps takes front and center.

What is innovation?

Innovation is an old school practice that’s been weaved into every success story you’ve ever heard.  Apple used it to change the personal computer. Starbucks owned it to change the way we consume coffee. And Google is a walking talking billboard for it as it’s changing the way we do everything.

Innovation represents your ability to ‘try something new’ … to shake up the status quo.  To simply think ahead.

But is innovation simple?  No.

Innovation is risky and failure can cost.

But when it works…

Innovation fuels entrepreneurship.

Unlike larger companies bogged down with years old mindsets, traditional top down org charts, and demanding shareholders, small businesses have the benefit of being ‘small.’  With less red tape and more creative control, the soil of entrepreneurship proves fertile for those in small business, if they are willing to move away from the pack and hunt new ground.

Many entrepreneurs today once worked for a larger company. And if you ask them why they chose to leave, the answer is almost always the same…”I knew I could do it better.”  They wanted to innovate, to put a fresh spin on age-old problems, but bumped up against the confines of corporate structure.

And now that they’re in business, entrepreneurs use the innovations of others to find better ways to operate and grow.  Just think about it…

If your hard drive crashes, you don’t panic because everything backed up to Dropbox.  When its time to expand your business, you look to Crowdfunder to raise the money you need.  And now that the storefront is open, accepting payments is quick and easy using Square and your iPad or smart phone.

Never stop innovating.

Where many of us falter with innovation is that we stop. Once we get that BIG idea, we stop looking for the next one. Which leads me back to where I started, Blockbuster.

The first Blockbuster store opened in 1985 and the company dominated in the 1990s. But, it found itself grossly out of step in the digital age and couldn’t keep up.  Despite chances to dive in, even a rumored opportunity to buy a tiny startup called Netflix back in 2000, Blockbuster couldn’t compete with companies who saw a better way.

What can you do?

Be in constant pursuit of new ideas for both your business and the customers you service. Create an office culture that supports innovation, encouraging employees to share their ideas and rewarding them for those that are used. Look to social media and other online sources for cues to changes in your industry and customer preference.