Today, in what most could only describe as inevitable, Blackberry announced it has accepted an offer to be purchased by a Canadian insurance company . If the deal goes through, Fairfax Financial will be the company’s new owner by November in a deal valued at $4.7 billion.
With Blackberry going private, this is the end of the story of a beleaguered, publicly traded tech company that once reigned as a giant in the industry. Its new owner will most likely sell the company for parts. What happened that caused the smartphone maker to take such a spectacular fail from grace, and what can we learn from their experience?
1. They “knew” what consumers wanted
When the original line of Blackberry devices came out, they were the most innovative piece of technology on the market. The units were flying off the shelves and RIM was experiencing its peak.
In one respect, the company had found something that consumers all over the world fell in love with. However, because of this they assumed they knew consumers better than anyone else. When Apple launched the iPhone, Jim Ballisie and Mike Lazaridis said many arrogant things about the touchscreen phone and informed everyone that for many reasons, its was not something consumers wanted. They were wrong. By the time they wised up it was too late.
Lesson: never assume you know what your customers want. Always be seeking their input through crowd sourcing, surveys and face-to-face discussions. If you don’t solve their problems, someone else will.
2. Bad Marketing
It is amazing that the a company with a great product had such poor marketing. Like the ad below for the Blackberry Curve featuring a group of cyclists meeting for a ride on glow-in-the-dark bikes. The ad told us nothing about RIM’s newest device, but did leave us with one question: where do I get one of those bikes! Or its 2013 Superbowl ad featuring the Z10. At the end of the ad, a voice over proclaims “in 30 seconds its easier to show you what it can’t do.” They never showed the consumer anything it could do, so they tuned out.
Lesson: Picture every marketing attempt as a chance to tell a story about your business and products. If they are watching or reading your ad, you have their attention! Don’t waste the opportunity on flash-in-the-pan silliness, just give them the information they need to solve their problems.
3. Didn’t take calculated risk-taking
Once RIM launched the series of Blackberry devices, they played it safe. The company stuck to what they knew consumers liked instead of branching out. Some say this was a cultural difference, with Canadian companies taking fewer risk then their American neighbours. Cultural differences or not, they didn’t try to evolve their product into something better. Steve Jobs was more than happy to take bold risks at Apple, and he was awarded greatly for it.
When Blackberry finally got back in the game with the new devices, they were forced to fight an uphill battle. In order for the Z10 and Q10 to bring the company back to its glory days, it had to be better, faster and offer more innovative features not already on the market. While the new devices were a vast improvement on what the company was currently offering, it just wasn’t enough. It was too much like devices that were already out on the market, giving consumers very few reasons to pick up the new Blackberry device.
Lesson: By clinging to the status quo of your product offering, you will soon be overtaken by those competitors willing to take risks. Always be looking for ways to improve your product or how you market it. As consumers, we more fickle then we used to be. Loyalty will always take a backseat for something better or cheaper.