According to this week’s blog post from member company Social SafeGuard, in today’s highly competitive marketplace, innovation is what ultimately sets a company apart from the rest of the market. Innovation is an essential part of any business that does not want to be left behind, and it can come in many forms when it comes to how a company communicates with its customer base.
Social media is currently the most powerful and effective communications tool available. Twenty five years ago the concept of a globally available, user-generated content platform didn’t exist. Today, the utilization of this platform is a key to success for any business. In today’s highly competitive marketplace, innovation is what ultimately sets a company apart from the rest of the market; it is an essential part of any business that does not want to be left behind. Innovation can come in many forms when it comes to how a company communicates with its customer base.
In order for a company to effectively satisfy their customer’s wants and needs, they must constantly communicate and listen to them; furthermore, companies must use the findings of this communication to adapt their product or service accordingly. 72 percent of adult internet users in the U.S. are now active on at least one social network, up from 67 percent in 2012 and just 8 percent in 2005. It is obvious that social media is the most effective way to reach and engage with today’s consumer. History is littered with companies that were once dominant players within their industry, but failed to effectively engage and listen to their customers, which eventually led to their demise. Two prime examples of this are Kodak and Blockbuster.
1. The Last Kodak Moment: Kodak was the primary player in the camera industry for almost a century. Kodak was the American technology company known for inventing color film, the handheld movie camera, and the first digital camera. In the late 1990s, Kodak began to struggle financially due to its sluggish transition to digital photography, regardless of the fact that they invented the core technology used in current digital cameras. After 132 years of business, Kodak officially filed for bankruptcy in 2012 due to their inability to adapt to the changing camera industry. All Kodak had to do was communicate with their customers to discover that preferences were changing, but instead they chose to stick with what they had always done, which resulted in a loss of competitive advantage and economic failure.
2. Blockbuster: For many years, Blockbuster was the dominant player in the movie rental industry. Once Netflix, Redbox, and On Demand Cable Services entered the market, trends quickly changed to customers wanting videos instantly and conveniently. Blockbuster chose not to adapt to the changing marketplace until it was too late. In 2010, the company filed for bankruptcy after 25 years of business and the majority of their stores closed shortly thereafter. While Blockbuster still attempts to mimic their competitors in an effort to regain any possible market share, they are now chasing the industry instead of leading it.
Every company must adapt and embrace social media if they do not want to become the Kodak or Blockbuster of their industry. Social media allows people to create, share, or exchange information and ideas in virtual communities and networks. Unlike traditional communication tools, social media has unmatched reach, frequency, and usability. Social media is the medium in which today’s consumer chooses to communicate. It would be foolish for any company to not adopt a platform that provides a free flow of information with a global reach, where all of their current and potential customers are present, and openly telling the companies exactly what they want.
If Blockbuster would have been proactive and engaged their customers, it is possible they would now have 57 million subscribers streaming videos in over 50 countries, and Netflix would be nothing but a failed startup.