I’ve enjoyed watching the Blockbuster/ Netflix battle unfold. Both rent movies by mail. Blockbuster’s angle: When you’ve watched the movie, come by one of our store locations and rent another one- why wait to mail movie A back and get new movie B sent to you? A shift is occurring: People are buying the same service (movie rental), but more by mail, internet or from their cable company.
Another good example is music. I’m a HUGE classic rock music fan (I’m also slowing selling my 12 year old son on my taste in music). Has anybody driven by a music store lately? They’re nearly all gone. So where are people buying music? “Big, generalist’s chains like Wal-Mart, Target and Best Buy”. In fact, “The big boxes have become the new tastemakers…they are the industry’s biggest distribution channel….the music titles they choose not to carry face drastically reduced chances of reaching mass audiences”. Another distribution channel is Starbucks (I require a disturbing amount of caffeine to get through the day, so I’m a frequent customer). While I’m waiting for the Art History PhD candidate to make my drink, I flip through the CDs they have on display. Starbucks is signing artists to exclusive distribution deals.
The Lesson: Business owners need to be aware of how customers are buying the product or service they offer- and if the way they purchase is changing.
Your Homework: The biggest ongoing change in buying habits seems to be Internet-related. Think of one way you could use the web to enhance your business.
(Source: Wall Street Journal, 5/2/07)
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