It’s 2020, the entire world is in crisis. For now we’re safe in our homes and, if we can, we’re still working in an attempt to maintain momentum and keep things BAU as best we can. We know when the dust settles things will never be the same and we’ve been warned it’s going to be tough. But we’re also sure we’ll come through the other side, aren’t we?
We faced recession back in 2008 and, although, yes, some companies were very unlucky and there was no saving them, others only had themselves to blame and, in all likelihood, would have gone bust recession or not. So what does that tell us?
It means we can sit back and wait to see whether we manage to pull through okay and can rebuild without too much damage. Or we can think outside the box, adjust to our new circumstances and hopefully come out the other side relatively unscathed, or maybe even stronger.
We’ve collated 15 famous brands who failed to adapt, take chances or innovate which ultimately led to their demise… It just goes to show how crucial it is to evolve, even in the most difficult circumstances, when the odds feel stacked against us. Even then, not everyone will pull through. But if the below is anything to go by, it’s the best chance we’ve got.
Apart from featuring in a Pitbull song (twice, because Kodak definitely does rhyme with Kodak), it’s been a while since we heard from these guys. After dominating the photographic film market during most of the 20th century, Kodak filed for bankruptcy in 2012. With many, including former Vice President Don Strickland, citing failure to jump on the digital movement as the reason. He said: “We developed the world’s first consumer digital camera but we could not get approval to launch or sell it because of fear of the effects on the film market.”
The leaders of Kodak failed to see digital photography as a disruptive technology so didn’t act on it. While management was so focused on the film success that they missed the digital revolution after being the ones to start it.
Book and music retailer Borders was founded in 1971 and peaked in 2003, with over 1,200 shops, 36,000 employees worldwide and healthy profits of about £64 million. But its failure to foresee the rise of e-books and embrace the world of e-commerce are often cited as the main factors of its downfall. Borders went bankrupt and was bought by Barnes & Noble in 2011.
However, we still have other physical bookstores despite e-books and Amazon prime delivery? It could be argued that book shops like Waterstones survived when Borders didn’t because they adapted and changed their plans to suit the circumstance. Waterstone’s went down an “experience” route, making their physical stores into spaces for fun book events and parties as it was found people were spending more money on memorable experiences after a rubbish few years post-recession.
During the current lockdown we don’t really need the month-long battery life Nokia’s seemed to have, but I bet we could all use a game of Snake to pass the time. In the late 1990s and early 2000s, Nokia was the global leader in mobile phones. The company’s downfall came when it overestimated the strength of its brand and decided not to “alienate” it’s customers by changing too much. Meanwhile, its competitors understood that data was the future of communication over the traditional voice phone call.
Nokia believed they could arrive late in the smartphone game and succeed. In 2007, Steve Jobs launched the iPhone, the touch screen phone we all know today. The iPhone was the first mobile phone without a physical keyboard, it was revolutionary. In 2008 Nokia finally made the decision to compete and release a smartphone, but it was too late. Their products weren’t good enough and people had already started to choose their side in the great Apple vs Android battle. So it was so-long to Snake.
Yes everyone would be quick to blame Netflix. But Netflix didn’t actually start as a streaming service, they were an online company who would post DVDs to your door for you to watch then post back. They moved with the times and switched to streaming when the market did.
But did you know that Netflix actually tried to hand Blockbuster a lifeboat and it was refused?
In 2000, the founder of Netflix, Reed Hastings, proposed a partnership to the former CEO of Blockbuster, John Antioco. The plan was for Blockbuster to advertise Netflix in their stores while Netflix would run Blockbuster online. Antioco turned it down because he didn’t see any value in the deal and thought that Netflix’s business model was “niche.” In 2010 Blockbuster filed for bankruptcy and Netflix is now a $28 billion-dollar company.
Another case of kicking themselves now is when it comes to Yahoo. Yahoo undervalued the importance of search and in 2002 their CEO refused to go through with a deal to buy Google. Yes, actual Google! The search engine that receives 5.6 billion searches per day. How do I know that? I Googled it. And in 2006 Yahoo had a deal to buy Facebook but Mark Zuckerberg, founder of Facebook, backed out when Yahoo lowered their offer.
In 2005 Yahoo was one of the main players in the online advertising market and, instead of search, the company decided to focus more on becoming a media giant. The decision to focus more on media meant they ignored consumer trends and a need to improve the user experience. Yahoo managed to gain a massive number of viewers but failed to make enough of a profit in order to scale. So, if Yahoo had taken the jump or done their research we could all be “Yahoo’ing” to see if I made these facts up instead of “Googling” them.
A personal motorized scooter invented and brought to the market in 2001 was supposed to be the new, low-pollution, quick way to travel short distances. It’s now actually just used by “Mall Cops” in American movies and students in Glasgow’s hipster west end.
Issues around the hefty $5,000 price tag and rules for where you can and can’t ride led to it becoming more of a gimmick than the revolutionary mode of transportation they planned. If Segway had cleared the rules on where it could be used with authorities before setting the price and expectations or aimed for a different market, it could have been a different story.
- Tie Rack
This one’s a bit of a throwback – a British tie retailer, founded in 1981. It was often found in train stations and airports to attract the attention of their target market; business-men. Unfortunately, Tie Rack is another one that failed to do its research about men’s shopping behaviour. The stores only sold scarves, ties, and cufflinks, but it turned out men were mostly buying their ties when they bought shirts. It was announced late 2013 that Tie Rack would begin closure of its remaining 44 retail stores. A little bit of thinking outside the box and listening to the climate they were selling in could have changed the path for Tie Rack.
In a story very similar to Nokia’s, Blackberry were flying high until they weren’t. And the silver bullet, the same again, failure to adopt a touch screen keyboard. BlackBerry was more concerned about protecting what it already had, a smartphone that was highly praised from 1998 into the early 2000s. But they failed to adapt to consumers’ wants and needs. In 2017 the CEO John Chen announced that BlackBerry was out of the smartphone manufacturing business and that the company would be focusing their efforts elsewhere.
Another one who underestimated Mr Zuckerberg. In 2005, Myspace CEO Chris DeWolfe actually met up with Facebook founder Mark Zuckerberg. Mark offered to sell Facebook to Myspace for $75 million, which Chris refused. With Facebook growing hugely, Myspace suffered great losses in users. In 2011 the company changed its focus from social networking to entertainment and music only. Then later that year MySpace fired nearly 500 employees after a severe downward spiral.
You guessed it… didn’t make the move to smartphones. In fact, Motorola completely missed the movement to 3G entirely. They didn’t implement 21st-century communication, such as instant messaging, to its products making it impossible to compete with smartphones. Props to CEO Greg Brown who took responsibility for the firm’s demise. Instead of blaming the recession or the new digital age, like many others, he stated in an interview that “Failure was our fault, not economy.
- National Geographic
National Geographic started as the official magazine of the National Geographic Society and has been published continuously since 1888. It’s a magazine that masters the art of visual storytelling and inspires photographers and filmmakers all over the world. They are often referred to as the first pioneers of amazing content. So what’s the story?
During the 1980s National Geographic was presented with an idea to start their own cable channel. When they refused, the group of producers who pitched the idea decided to do their own thing and launched the Discovery Channel, the History Channel and others. Seeing their success, National Geographic decided to launch their own cable and satellite channel in 1997 when the Discovery Channel had already established a solid fan base.
If National Geographic had taken a leap, instead of resting on their laurels, we could have been singing “let’s do it like they do on the National Geographic channel” instead. Oh and, they’d have made a ton of money from advertisers. But mostly, the Bloodhound Gang thing would have been pretty cool.
- Abercrombie & Fitch
American fashion brand Abercrombie & Fitch was once one of the coolest casual wear and accessories brands. In the early 2000s, everything about it was a teenager’s dream experience. The attractive staff, topless greek God looking guys outside, the scent pumped round the shop so strong you could smell it across the street. If you had one of their hoodies or even carried your PE kit in one of their carrier bags, you were cool.
But something about the Abercrombie & Fitch brand just doesn’t sit right in 2020. First off, it was an experience that came with an expensive price tag, it was considered elite for a reason. These days teens can get fashionable clothes at more affordable prices from “Fast-fashion” brands such as Primark and H&M. And secondly, in a time when we preach inclusivity and body-positive, it feels just plain icky to only employ conventionally good-looking staff. A&F now seems completely out of touch and, what’s worse (depending on your viewpoint) is that they don’t even seem to be worried about it…
In 2006 CEO Mike Jeffries stated: “Sex sells. That’s why we hire good-looking people in our stores. Because good-looking people attract other good-looking people, and we want to market to cool, good-looking people. We don’t market to anyone other than that.” A district manager added: “We would rather burn clothes than give them to poor people.”
Oookaaaaay. Those quotes speak for themselves.
- Toys R Us
Now this one does seem a little unfair. The kids toy retailer, Toys R Us, was once one of the largest and most recognised toy store chains. The brand signed a 10-year contract to be an exclusive vendor of toys on Amazon. But, despite the deal, Amazon allowed other toy vendors to sell on its site anyway.
Toys R Us sued but, as a result, missed the opportunity to develop its own e-commerce presence. In 2017 the company filed for bankruptcy, because of its huge debt and retail competition. Then in February 2018 Toys R Us officially went into administration. In hindsight, they should have been more forward-thinking and set up their own e-commerce instead of partnering with Amazon.
The CD, VHS and video game retailer, popular in the 1990s, belongs to the long list of retail companies that failed due to the rise in online services and e-commerce. HMV refused to believe the boom of online retailers or that people would ever start downloading music. The leaders of the company felt confident about their brand and loyal customers who, in their opinion, loved coming to the shop for the floor experience. In 2013, Hilco Capital purchased HMV, taking the company out of administration and saving 141 of its stores.
The Concorde was a British-French turbojet-powered airline that closed its doors in 2003, and is also often an answer in pub quizzes. The airline was founded in 1976 and used to have one of the fastest and greatest designed aircrafts in the world. The Concorde could fly across the Atlantic in less than four hours, but its high energy consumption forced airline companies to look for better options. It didn’t help that the Concorde was also incredibly noisy.
Boom Technology is an American start-up who plan on following in Concorde’s footsteps, designing a 55-passenger supersonic transport to be introduced in 2023. Blake Scholl, the founder, says: “Where else in tech do you have a capability and then you go backward? It’s kind of crazy on the face of it”. Due to all the technical flaws and financial challenges The Concorde flew its last plane in 2003.
The end of them & the end of this
So there you have it, 15 brands who could have been but failed to read the market and adapt accordingly. The irony is there’d still be a place for each of these brands in 2020 had they not taken themselves out of the market by their failure to keep up. No well-known brand becomes irrelevant, it’s the service or product they provide that can become redundant if it doesn’t keep up. Product or service not in demand anymore? Change it. It’s all supply and demand, baby. And strong brands with forward-thinkers come out on top!
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