15 BIGGEST Business MISTAKES In History

Summary

This video explores some of the biggest business mistakes in history, highlighting costly errors made by top companies. Examples include Excite’s rejection of Google, Blockbuster’s dismissal of Netflix, Kodak’s failure to develop their digital camera patent, and M&M’s turning down product placement in *E.T.*. Other notable blunders include Quaker’s $1 billion loss on Snapple and Ford’s Edsel flop. These examples show how poor decision-making, missed opportunities, and a lack of vision can lead to monumental failures, offering valuable lessons for entrepreneurs and business leaders.

Takeaways

• 😀 Excite's executives passed on buying Google for just $1 million, missing out on a trillion-dollar opportunity.
• 😀 Blockbuster laughed off Netflix's offer to handle its online services, leading to Netflix's domination in streaming.
• 😀 Kodak patented one of the first digital cameras in 1977 but failed to innovate on it, leading to its eventual decline as digital cameras became mainstream.
• 😀 Pets.com spent millions on high-profile marketing but failed to ensure market demand, resulting in its collapse during the dot-com bubble.
• 😀 Quaker bought Snapple for $1.7 billion in the 90s but lost $1.4 billion when they failed to anticipate competition and poor marketing.
• 😀 Mars turned down the opportunity for ET to feature M&Ms, allowing Reese's Pieces to become one of the most successful product placements in history.
• 😀 20th Century Fox turned down merchandising rights for Star Wars, missing out on billions of dollars in revenue from toys, clothing, and more.
• 😀 Coca-Cola’s attempt to reformulate its flagship drink into 'New Coke' was met with backlash, leading to the quick return of the original formula.
• 😀 Ford ignored market research in the 1950s, investing millions into the Edsel, a car that consumers found too expensive and unnecessary.
• 😀 AOL and Time Warner’s merger in 2000 became one of the biggest corporate failures due to cultural clashes and the bursting of the dot-com bubble.
• 😀 Alitalia sold business class tickets for $39 due to a simple typo, leading to a $7.7 million loss after thousands of tickets were sold by mistake.
• 😀 Mizuho Securities sold 610,000 shares for one yen each instead of 610,000 yen, resulting in a $225 million loss and a market shutdown.
• 😀 Schlitz beer reduced brewing time and used cheaper ingredients in 1976, leading to a recall of millions of bottles and a dramatic loss in market share.
• 😀 Decca Records turned down The Beatles in 1962, dismissing them as 'a passing fad,' missing an opportunity that would have made them one of the biggest music labels in history.
• 😀 Xerox shared its innovative graphic user interface ideas with Apple in the 1970s, missing the chance to dominate the tech world, while Apple revolutionized computing.

Q & A

What was the major mistake made by Excite in the late 1990s?

Excite rejected an offer to buy Google for $1 million, and even turned down a second offer of $750,000. Google later became the world's largest search engine, while Excite faded into obscurity.

How did Blockbuster's decision to reject Netflix impact their future?

In 2000, Blockbuster turned down an offer from Netflix to handle their online rental service. By the time Blockbuster entered the online market in 2005, Netflix had already dominated the streaming market.

What was Kodak's critical mistake regarding digital cameras?

Kodak patented one of the first digital cameras in 1977 but failed to develop the technology, focusing instead on film-based products. By the time digital cameras became widespread, Kodak's market leadership was gone.

Why did Pets.com fail despite its heavy marketing efforts?

Pets.com invested heavily in marketing, including a high-profile mascot and TV ads, but failed to assess the market demand for their products. The dot-com bubble burst and the company's lack of a viable business model led to its collapse.

What led to Quaker's loss of $1.4 billion on Snapple?

Quaker bought Snapple for $1.7 billion, but underestimated the competition and overestimated the brand’s potential. Their poor marketing and the rise of other competitors led to a massive loss when Snapple was sold for only $300 million.

How did Mars miss a lucrative product placement opportunity with *E.T.*?

Mars rejected the offer to feature M&Ms in *E.T.* due to concerns about the suitability of the product. As a result, Reese’s Pieces took the spot, boosting their sales by 65%, while Mars missed out on the opportunity.

What mistake did 20th Century Fox make regarding *Star Wars* merchandising?

In 1977, 20th Century Fox passed on a merchandising deal for *Star Wars*, not recognizing the potential for toy sales. The *Star Wars* franchise went on to generate billions in merchandising revenue, leaving Fox with a missed opportunity.

What was the consumer reaction to Coca-Cola’s *New Coke*?

Coca-Cola introduced *New Coke* in the 1980s to compete with Pepsi, but the public backlash was immediate. Consumers rejected the new formula, and after only 79 days, Coca-Cola reverted to the original recipe.

Why did Ford’s Edsel car model fail despite market research?

Ford ignored market research showing that consumers preferred smaller, more affordable cars and proceeded with the Edsel, a large, expensive model. The car flopped and was discontinued after only three years.

What was the result of AOL and Time Warner's merger in 2000?

The merger between AOL and Time Warner, which initially promised dominance in the media landscape, turned out to be a disaster. The companies faced leadership clashes and the dot-com bubble burst, causing their combined value to plummet from $300 billion to $40 billion.

How did Alitalia lose millions due to a website error?

In 2006, Alitalia mistakenly listed business class tickets for $39 instead of $3,900 on their website. Thousands of tickets were sold before the error was discovered, leading to a $7.7 million loss.

What happened with Mizuho Securities' stock sale error in 2005?

A broker at Mizuho Securities accidentally sold 610,000 shares of a company for just one yen each, instead of 610,000 yen per share. The mistake caused a market shutdown and a loss of $225 million.

What was the reason Schlitz beer lost its popularity in the 1970s?

Schlitz beer reduced its brewing time and used cheaper ingredients like corn syrup instead of barley malt. The resulting product had a poor taste and was forced to recall 10 million bottles, causing the brand to fade into obscurity.

How did Decca Records' decision affect the Beatles' career?

In 1962, Decca Records turned down the Beatles, citing that guitar bands were going out of style. The Beatles went on to revolutionize music and culture, while Decca missed out on massive profits from the band's success.

What did Xerox miss by sharing its ideas with Apple in the 1970s?

In the 1970s, Xerox shared its groundbreaking graphical user interface (GUI) technology with Apple. Apple used the idea to revolutionize computing, while Xerox missed the opportunity to dominate the tech industry.

What happened to NASA’s Mars Climate Orbiter due to a measurement error?

In 1999, NASA lost the Mars Climate Orbiter due to a unit conversion error. NASA's team used pounds instead of newtons for the probe's calculations, causing it to go off-course and ultimately get lost in space.