Blockbuster, Inc. Most Americans like to spend their free time on entertainments. Movies, for example, qualify as the best way to spend an afternoon or holiday, hence, Blockbuster is a quite handy option. Blockbuster Inc. is a provider of home movies and video games rental services on the basis of subscription. In the year 2004, Blockbuster appeared to be at its peak and had around 60,000 employees and over 9,000 stores. Over the years, the movie rental chain has had tremendous success, as the customers download movies or games onto their mobile phones or order the movies by mail, or even visit one of the many blockbuster stores. By the year 2009, Blockbuster Company recorded revenue of at least $569 million. The company expanded from just being a movie rental store to delivering digitally and also by mail. It mainly happened due to the rivalry with its major competitor - Netflix. The reason for this expansion was also to capitalize on the existing customer trends. Blockbuster appeared to be a leading company in video rentals. However, on September 23rd 2010, Blockbuster lost significant revenue and fell bankrupt. There appeared to be a number of reasons why Blockbuster got out of business. One of the reasons was internet piracy. Blockbuster customers appeared to be downloading movies and video games online either into their computers at home, or to their mobile devices. However, when internet piracy started to flourish, the revenue Blockbuster Inc. was getting from online sales started to decline; thus, leaving them with debts. Another reason why Blockbuster fell bankrupt was because of the intense competition in online rentals. Companies like Netflix, and RedBox were severely competing with Blockbuster, and eventually, the latter lugged behind in the online rentals; hence, lost revenues to its competitors. It appeared to be the major factor why the company that was deemed to be the largest, ended up declaring bankruptcy. Any mistake that Blockbuster made appeared to be an advantage to the competitors. For instance, Blockbuster has high prices for its services, while the other rival companies, such as the abovementioned Netflix, offered movies at affordable and lower rates than Blockbuster. As another example, RedBox charged only $1 per movie, while Blockbuster charged $5. It means that customers ended up going for movies at a cheaper rate, thus, revenue for Blockbuster decreased. Nobody could ever imagine that Blockbuster Inc. - a leading company in movie and video game rentals, would ever declare bankruptcy. Another reason for such a consequence appeared to be the company's strategy of opening as many stores as possible. It was a strategy aimed at capturing a huge share in the market. At first, this approach seemed to be working, however, Blockbuster did not realize that operating more stores, only meant an increase in operation costs. The business generated revenue from the stores, but the same revenue also appeared to be used in running the costs of operation. It simply means that the company had nothing much to gain, as the profit they were incurring, was used to cater for running of the large chain of stores. Another issue that contributed to the failure of this company, is the customer preference. Blockbuster, as a company, thought that it would be wise to stock up new movies and less of the old ones. It proved to be a downfall for them, since quite a formidable number of customers still preferred to rent the classic old movies, which were not available or were given out. The method really inconvenienced the customers, who had to wait till a copy of the movie they required, was returned, or they ended up going to another store. It means that Blockbuster started to lose its customers, who appeared to be going to Netflix and RedBox that had enough copies of old and new movies, thus, keeping their customers satisfied.

In conclusion, everything comes to an end at certain point. It does not matter how big a company is; there are various perspectives of new ideas, and when a company does not take it into consideration, it would end up to be their downfall.

The article was created by Keri Johns. She writes for https://ratewritingservices.com/review/exclusivethesis-com-review.html