Achieving business success globally is dependent upon many factors. Many companies operate well in their countries but fail overseas. Here is the list of top businesses that didn’t work well in international markets.
- NOKIA
The Finnish company Nokia reached its failure when Microsoft acquired it. Although the products and branding of Nokia continue, it is no more. Nokia started its business with products like paper items, rubber boots, bicycle tires, and many other electronic items before getting into the mobile industry.
The first phone call was made through the Nokia cell phone in 1995. The first business phone, camera phone, and even a torch phone were all released by Nokia in India. Nokia invented the ever-so-popular Snake game.
For 14 years, Nokia was the biggest name in mobile phone making companies. Although the failure of Nokia was global, many said that it began with losing its grip in the Indian market.
- Why did it fail?
Relying only on Symbian operating systems, Nokia failed to adapt the new software in the market quickly and focused only on producing better hardware. This caused its downfall and companies like Apple and Android took the market. Also, with Samsung expanding its base in India, investing steadily in Research and Development, and with the launch of iOS and iPhones, people forgot Nokia.
- Blockbuster LLC
Home movies and video game rental services, Blockbuster opened its business in Dallas, Texas on October 19, 1985. At a time when most video stores were small-scale businesses, Blockbuster proved to be one of the top video rental services. By the early 1990(s), Blockbuster launched its 1000th store.
Reaching its peak in 2004, Blockbuster employed 84300 people worldwide and had 9094 stores.
- Why did it fail?
Blockbuster underestimated the number of customers who wanted the old title. Customers routinely stood in the line for new movie titles. They had to wait for another customer to return the DVD. It made a huge amount by charging customers with a late fee. At this time, Netflix had certain benefits. Abstaining from retail locations, it could offer a greater variety at lower prices.
Instead of charging late fees, it offered customers with subscriptions. Customers could watch the videos seamlessly as long as they wanted, give back, and get a new one. In 2000, Netflix approached Blockbuster with an offer to sell its company for $50 million but the Blockbuster CEO considered it as a “small niche” which led to its downfall. Unable to compete with Netflix, it filed for bankruptcy in 2010 having a debt of around $1 billion.
- KELLOGG’S
Kellogg’s was and is still a famous brand. Its cereals are well-known and consumed all over the world more than any of its rivals. With many other popular brands, Kellogg’s was having a 40% market share among its competitors.
- Why did it fail?
Tough times began for Kellogg’s in 1990(s). Its market share began to fall due to increasing competition and with the attempt to expand its market beyond the USA and UK, it came to India in 1994. It launched the top brand “Corn Flakes” after heavy investment in the country and positively evolved due to huge market potential.
But again, Cereal-eating was a new concept in India which relied mostly on a hot bowl of veggies. Moreover, Kellogg’s was costlier than other alternatives that were available at almost one-third of the price of Kellogg’s.
By lowering the prices and introducing more products like Wheat Flakes, All-Bran, Honey Crunch, etc. As a result, the sales lifted from decent to poor, and Kellogg’s became a one-off novelty purchase for many people. Even the attempt to ‘Indianize’ the products with other spices didn’t work too well, and now Kellogg’s is trying to invest in biscuits.
Over 20 years have passed and the business is nowhere closed to where it expected to be. Yet, Kellogg’s is willing to explore future opportunities.
- eBay
eBay was founded in September 1995 by Pierre Omidyar as an idea to collect and sell Pez dispensers. The company used an electronic platform managing millions of auctions online. Around 2000, eBay had 12 million registered customers worldwide, and more than 4.5 million items for sale on any day.
- Why did it fail?
In 2004, eBay entered the Chinese market purchasing the already existing Chinese company Eachnet. In 2003, the competitor Alibaba group entered the market and conquered the Chineses markets. The CEO of Alibaba group Jack Ma knew very well that Chinese people were more mobile-savvy than computer-savvy so he provided an instant messaging system to establish communication between buyers and sellers throughout the process.
Ma understood that building relationship was the principle in Chinese businesses which eBay missed. Finally, in 2006, eBay shut down its website.
- KODAK
The American company Kodak was the explorer of camera technology. Built on the fierce foundation of innovation and modification, Kodak is rightly praised for many inventions in the photography industry. It was such a huge brand that its tagline “Kodak Moments” pointed out the happy moments of life, and was used in events around the world.
For three-quarters of the 20th century, Kodak’s success was not only generating the new technology – the film camera but also building a new mass market.
- Why did it fail?
Kodak didn’t fail because it forgot the digital age. In 1975, Steve Sasson, a Kodak engineer who invented the first digital camera. But, instead of marketing the new technology, the company saw it as a threat to its lucrative film business even after digital products were rebuilding the markets.
Due to its slowness in transition, Sony, Nikon, and Fujifilm introduced this technology and got tremendous opportunities in the market. Kodak denied moving ahead with the filmless digital technology. Failing to lead the world, the company declared bankruptcy in 2012 and exited the image capturing business.
- GENERAL MOTORS
One of the world’s largest car manufacturers, General Motors (GM) re-entered India in 1994. After a 21 years long journey in the country, the company decided to quit selling vehicles in India. The company’s market share never lifted to double digits in India.
- Why did it fail?
Primarily, due to bad networking and poor structuring issues, they shut their business in India. The company was struggling with some management issues which contributed a lot towards failure. GM had 9 different CEO(s) with an average tenure of only 2.5 years. CEO(s) at GM never focused on building a strong network or strategy.
Changing regional dynamics and consumer needs can make it tough to understand and adapt to any business. Market research and adaptability are the key factors for any business to grow. Don’t overestimate your company as this can result in downfall. Nevertheless, if one keeps his customer’s needs and expectations at the top, the journey can get easier a lot.
