Demise of Blockbuster, Borders and Google?

The collapse and subsequent bankruptcy of Blockbuster and Borders recently got me thinking about how swiftly the online world has become a critical factor for survival. Both these companies were a long time coming so it hardly should be a surprise but still thinking back only 5 years or so when Borders opened a massive store in Lygon street in Melbourne Australia. Even back then we thought it was the height of arrogance but for different reasons*. Similarly Blockbuster was at least a weekly event, during my second year of Uni boredom meant five videos from the local Blockbuster. It is one thing to realize intellectually companies are being born and dying at an exponential rate, it is another to experience the death of  these giants that seemed bluechips only years ago.

The real reasons to worry about Blockbuster and Borders was the lack of transition from purely bricks and mortar businesses to enterprises that funnelled an online presence to offline profits. There is no doubt that the recent trend to consume more and more of this content online and piracy aided this demise but it was hardly the starting point. It is not like these once successful offline businesses were completely replaced by online upstarts. People still buy physical books and DVD's, its just that the way we search, discover, compare, share and purchase these have moved online.

Amazon and co provided a simple way to search the entire long tail of books, to discover books based on past choices and what others had recommended, to compare based on expert and user reviews, to share "likes" and wishlists with relatives shopping for Christmas presents and to purchase and have any book delivered with one click. Borders was still showing the top 20 lists in their expensive retail space. Blockbuster is a similar story. Netflix, iTunes and co provided  a simple way to search for any movie, access a curated list of recommendations, instantly see and participate in expert and user reviews and to rent content for viewing on DVD or instant steaming. Blockbuster had the top 10 list, 3 months after anyone cared, anything older meant browsing a rows of content organized in rough categories without even a dewy decimal system. Reviews? Hope you like what the publishers put on the DVD cover.

An interesting aspect looking forward is whether as Ben Keighran asks for mobile apps is it 1996 again? If companies do not transition to the new mobile world with apps, location based services, near field communications will they face the same fate as Blockbuster and Borders? It is really a different conversation when you view evolving to meet the challenges of this environment as something needed for survival.

Another point I also wanted to make was that while online search, discovery, recommendation, reviews and comparisons are critical for any non impulse buying decision today it is far from perfect.

I was shopping around for a shipping service to move some personal goods from London to Australia today. Of course I was doing it online, I would not dream of doing it offline. Finding shipping companies was no good though, I needed THE shipping company - the cheapest and most reliable. I started with Google and the results gave me some shipping companies but not even adding the key words comparison or reviews gave me any way of gauging quality. As Barry Shwartz discusses in this excellent TED talk, what I wanted was not thousands of results but just the best one quickly and easily.

Next was social media - my friends on Facebook have done this before it was a simple process to get 1 or 2 recommendations. This was an improvement but the wisdom of crowds was limited here. The responses were only from a population of about 130 people and not a logistics expert among them. The recommendation may not have been the best available shipping service, nor a large enough set of experiences to identify the companies I should stay away from. Finally Q&A sites - my two favourite are Aardvark and Quora. I am trying Aardvark at the moment but I am actually too scared of the question nazis to post it on Quora. It just doesn't seem like the question should post on there, but after finding a post of moving stuff to Canada I did stick it up there. Results pending of course as there is no instant feedback, I'll check back in a few days.

The key point from my experience is that Google is becoming increasingly irrelevant and there is plenty of room for innovation and growth in online recommendation and Q&A. I totally agree with Vivek that Google desperately needs to incorporate more context relevant social data, recommendations from experts and tap into the wisdom of crowds for reviews and comparisons.  Otherwise it will drown in spam and be increasingly useless in providing answers to anything other than the most factual questions - and even then a direct search on Wikipedia is probably faster.

*This two floor corporate monstrosity seemed so out of place in the heart of the Italian heart of Melbourne, full of small, individual boutiques where you could sip a real expresso made by a real Italian.

Photo credits jswafford  Flikr

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