Do you remember as a younger person, stopping by a Blockbuster Video, Hastings, or Hollywood Video on the way home from work or school to decide on a movie for that night? What about walking into a Sam Goody or Tower records to find a CD or album from your favorite artist? Did anyone ever think we would live in a world without Sears or Kmart? All of these retail giants were faced with the reality that as Bob Dylan once put, “The times they are a-changin’”(Dylan). According to the New York Times, 89,000 Americans lost retail jobs between October 2016 and April 2017. (Corkery) This begs the question. What amount of flexibility does a company need to stay afloat in today’s business landscape?
It’s now a business legend and is one of the most astonishing non-deals in history. In the year 2000 the founder of Netflix, Reed Hastings, extended an offer to then Blockbuster CEO, John Antioco, to buy Netflix for 50 Million Dollars. (Satell) Antioco turned down the offer. As of May 2017, Forbes lists Netflix’s worth at 61billion dollars and is trading at over $198 dollars a share. (Netflix) Meanwhile, Blockbuster filed for bankruptcy in 2010 and closed all of its corporately owned locations. This, however, was not the first major retailer to go under after failing to anticipate a changing landscape in the business marketplace.
Music, since its ability to be recorded and bought, had always been purchased in hard copy form. The 8-track gave way to the cassette which turned to the compact disc. Napster changed how we consume music, Steve Jobs and Apple capitalized on it, and now various streaming services run the music industry. Music sections in department stored are shrinking at an alarming rate, meanwhile, streaming services such as Spotify, Apple Music, and Tidal are taking over larger and larger sections of the music industry. According to Business Insider and Neilson in 2016 “on-demand streaming had generated more revenue than digital album and track sales for the first time”. (Dunn) Business Insider also showed physical sales of music as only 22% of music industry revenue. (Dunn) The music industry was able to adapt and start to grow again after figuring out a solution to a changing industry landscape.
Its estimated by Bloomberg that fifty percent of Americans have Amazon Prime (Stratton), a service that gives free two-day shipping on many orders. Meanwhile, companies like Sears, Kmart, JcPenny, and others are filing for bankruptcy and closing many of their locations. Two of my earliest jobs were in the retail sector as a cashier. Those stores now look like ghost towns, the parking lots that were once packed on weekends are now largely empty outside of employee vehicles. Even Black Friday, the biggest shopping day of the year in America, a day whose name refers to a day when most brick and mortar retailers plan on turning a profit for the year. Even this day has dwindled as people have traded bundling up, waiting in line, and fighting crowds for clicking refresh on a computer in the comfort of their own home. Shopping malls that were once built as a one-stop shopping place for clothes, shoes, electronics and anything else you could need have been replaced with empty storefronts, for lease signs, and very little else. America is losing entry-level jobs at an alarming rate. A large portion of our economy is disappearing. What were once landmarks of American capitalism are now large sprawls of dwindling real estate ventures. The only type of brick and mortar store safe, at least for now, seems to be grocery stores, restaurants, and retail giants Walmart. What about the rest?
Is the writing on the wall for companies such as Target, Shopko, Bed, Bath, and Beyond and even grocery chains such as Albertsons, Super One, and Smiths? Will malls in America soon go the way of the cassette tape? Is it possible for the retail industry to find a way to survive the way the music industry fought from the grave back to its present state? Will more dominoes fall in the wake of the online retailer’s dominance? What level of flexibility will companies need to prevent going out the way Blockbuster, Tower Records, Sears and Kmart went? Something will have to be done to prevent a collapse of the American economy that could cost millions their jobs and livelihoods.