Richard Seesel

Blockbuster Facing Possible Bankruptcy

March 18, 2010

FROM RETAILWIRE:
Back in 2008, we wrote that Blockbuster's CEO Jim Keyes was looking to unlock the chain's potential by creating a deeper connection with customers. Now reports suggest that tightened credit on Blockbuster by movie studios may force the chain into bankruptcy. What do you think the future holds for Blockbuster?      [more...]

Changes to the operating model of Blockbuster (longer hours, coffee bars, etc.) can't change the fact that technology and other business models have left them behind. Blockbuster's mistake over the past five years was to react too late to the different types of competition offered by Netflix and Redbox. You can't beat Netflix for convenience and breadth of assortment, and they have been very forward-looking by adapting to live streaming technology. At the same time, Redbox has become a strong competitor in terms of new releases at low prices in convenient locations.

I made far too many trips to my neighborhood Blockbuster in the past, only to be disappointed in the search for a new release or otherwise walk out empty-handed. No retailer can survive forever at this level of execution, and my local Blockbuster now has a "Store Closing" sign by the front door.