Friday, September 24, 2010

Blockbuster Gone Bust: Who knew? Everybody.

Advertising, Marketing, Leo Burnett, Nintendo, Marshall McLuhan,  Torrents, Technology,  On-line, According to Market Playground, "It was only a matter of time. In a press release on Thursday, September 23rd, Blockbuster Inc. (PK: BLOKA, BLOCKB) filed for chapter 11 bankruptcy in an effort to recapitalize its balance sheet and put the Company in a stronger financial position as it continues to pursue its strategic plan and transform its business model.”

Duh. Ask any American kid what Blockbuster is and he'll tell you that's where mom hangs out to get bad movies. Ask an Asian kid and you'll get a blank stare. "So you go there and pay money and they give you a movie, but you have to bring it back?" Right. Germany has automats to handle this function. I laugh, as I torrent my next blockbuster.

I recall somewhere in the mid 90s, being asked to pitch the Blockbuster business at the Leo Burnett Company in Chicago. Having also been working on the Nintendo business, I was keenly aware of what the online gaming market was becoming and how video game consoles, even at that time, had a land-line phone jack already built in, ready for the kids to connect. "Isn't this all going online?", I naively asked at a prep meeting, having gone through reams of insignificant data stating that the brick and mortar concept had at least another 20 years in it.

Advertising, Marketing, Leo Burnett, Nintendo, Marshall McLuhan,  Torrents, Technology,  On-line, Hmm. Time flies. Seems as if we're already there. My old question was answered by a smarter-than-me account executive who told me that Blockbuster had determined that limited bandwidth would hamper online delivery for quite sometime and there was no need to worry about that. Until now, I guess. So hmm again. Sears created the catalogue, but lost the online business to Amazon. Sony created the Walkman but lost the personal music player market to Apple. And now Blockbuster has lost the home video market to Netflix and torrents. So what's the message here? The medium is the message here. The medium. Marshall McLuhan told us that. Too many years ago.


  1. Thanks for the link-back to our article. I agree - the medium is the key. Those who cannot innovate and stay current are going to die a slow painful death and take a lot of investor dollars with them. It is a lesson for all of us in life and in business. Those who do not innovate are destined for failure.

    Brian "Newman" Rayl

  2. In 1988, LBC was also working on another obsolete concept called "Teleaction"...also rims of useless data, the same scenario.
    It was a shopping experience test by combining your phone and images of merchandise on your TV screen. Don't ask me, its another DUH...
    The idiots who worked on it were a bunch of New Yorkers who didn't know crap about the suburbs of Chicago where this was test-marketed.
    It failed, what else...
    It seems to be a pattern at that company.

  3. I met Michael Conrad, ex-Global Creative Director for Leo in Munich this year at a conference called DLD (Digital/Life/Design) He told that this on-line thing was really the ticket and advertising companies had better take note. Now where was he 15 years ago when it was really taking off? He was sitting about three feet in front of me behind a desk and in the process of sending me off to Korea on my first International assignment. At that time the Seoul office had two old broken down Macs sent from Singapore and no computer for me. So I simply requisitioned a loner from the Chicago and stuck it in my carry-on bag for my two year stint in the ROK. I can't tell you how many faxes I had from the home office telling me to the bring the computer back. They hadn't even figured out email in 1995.

  4. "But, we've never done it that way." - Exactly Brian.


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