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7 Of the Worst Business Decisions Ever
While it’ s true we can learn from our own mistakes, it’ s much easier, faster and sweeter to learn from the mistakes of others.
With that in mind, here are 7 doozies that belong in the Marketing Mistakes Hall of Shame:
Schlitz Beer – At one time, Schlitz was the bestselling beer in America. Then they decided to change their formula, replacing quality ingredients with inferior ones, adding chemicals to try to mask the changes, and even changing the brewing process. All of this was to increase their profit margins so they could continue to compete on price against Budweiser.
Basically, the Schlitz people worked very hard to ruin a bestselling product. By the 1970’ s, they’ d changed the product so much that the bottom of each beer contained a repulsive mucus-like substance.
Of course, sales plummeted, and the brand lost over 90 % of its value. Schlitz beer was now relegated to the bottom bargain beer shelf for only the most desperate and poor of beer drinkers.
Lesson for online marketers? It’ s clear isn’ t it – quality DOES count. Whether you’ re creating products or acting as an affiliate marketer, if you don’ t offer your customers a quality product, they won’ t be back for more. And you’ ll get a lousy reputation in the process.
Star Wars – A long time ago in a studio far, far away, 20 th Century Fox made one of the lousiest business decisions – ever.
In 1973, George Lucas negotiated a deal with Fox Studios on a film he wanted to direct – sort of a space western. Fox had offered him $ 500,000 to direct, but George offered to do it for just $ 150,000 if they would grant him all merchandising rights as well as rights to all sequels.
As of today, combined revenue from merchandising and sequels of Star Wars is an estimated $ 42 billion.
Yes, that’ s right – Fox lost BILLIONS to save $ 350,000.
When you create a product, don’ t stop there or you’ ll be leaving most of your profit on the table. Create an upsell, a down sell, a continuity program, a coaching program and yes, sequels and updates.
You work hard to get your initial program sold, so why not bank on the goodwill you’ ve earned to sell even more?
Take a lesson from George Lucas; the big money isn’ t in the main product, it’ s in everything else that comes after.
Kodak – Did you know Kodak invented the first digital camera? But they panicked and made a terrible decision- sitting on the invention so they could continue to sell film.
Naturally, it was just a matter of time before other companies invented their own digital cameras. Since Kodak owned the patent, they made millions – until the patent ran out in 2007. 5 years later Kodak filed for bankruptcy.
Lesson learned? Don’ t try to fight progress. Instead, be an early adopter and use it to your advantage. Those who were first on board with online video did really well, as did those who jumped on board social media and so forth.
Things will inevitably change, which is why it’ s better to roll with the flow, look for new opportunities and never stick your head in the sand like Kodak did.