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The 5 most expensive business mistakes in history

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Not even the most experienced companies are exempt from making mistakes, and in their cases, the cost of them is multimillionaire

The 5 most expensive business mistakes in history

The big corporations in the world amass huge fortunes thanks to the prestige that among the buyers are built over the years. By satisfying the demands of the buyers, they manage to generate huge profits that with the passing of the years increase gradually depending on the curves of the world economy. However, some of the most powerful companies also make mistakes and many of them count for billions of dollars.

Leer en español: Los 5 errores empresariales más costosos de la historia

Here we present some cases of business failures that cost much more than what could be imagined at first glance and that were not resolved with a simple apology.

1. Coca-Cola

During the 70's, one of the first 'challenges', so common these days in social networks, was an advertising campaign that became known as the "Pepsi Challenge", in which this company gave two drinks to randomly chosen public to ask what was the drink of their choice. The results were devastating for Coca Cola, feeling its hegemony threatened in the soft drink industry, which led to a risky and reckless decision.

The company's top executives decided to change the flavor of Coca Cola to cope with the threat. The result was devastating, the new Coca Cola appeared in 1895, removing the original flavor of the world market.

The result was a resounding failure and the usual buyers of the red-and-white brand decided to change their preferred drink. Given the devastating results in figures, a few months after the original Coca Cola reappeared under the name of "Coca Cola Classic" recovering thirsty audience for the original flavor and teaching managers never to make such decisions without a market analysis supremely judicious, detailed and studied.

2. Western Union

This company, of historical importance due to its role in the popularization of the telegraph, has more than 150 years of history. There is no one left to blame for this huge error. In 1876 they received the visit of a young dreamer named Alexander Graham Bell, who for the amount of 100 million dollars offered the patent for a device that allowed to transmit vocal sounds through electrical undulations that traveled through wires, better known as 'telephone'.

This device promised to revolutionize communications. However, the managers and owners of the American business laughed, not only because of the cost but also at the invention they described as a toy that could never replace the telegraph as a communication media.

The following year, one of the most important companies in American history, Bell Telephone Company, was founded, years later becoming the American Telephone & Telegraph Company, better known internationally as AT&T biting a large piece of the Western Union hegemony who retired definitively from communications only in the year 2006.

3. Kodak

"You press the button, we do the rest," was the slogan used by the company to stimulate customers who saw the possibility of taking their own photographs with a portable machine that had 100 exposures. When these had been made, the owners gave the camera to Kodak's office, who revealed and printed the memories, returning the camera with another new reel and ready to continue pressing the button.

However, the successful business that had 64 thousand employees on its payroll and accumulated profits for more than 13,000 million dollars a year, came to a halt when digital photography was neglected, an invention of its engineer Steven Sasson that in December 1975 took the first and primitive digital photography with a resolution of 0.01 megapixels.

Companies that stood up as a solid competition for the giant Kodak, such as Fuji, Canon, and Sony were more visionary and began to explore the world of digital photography, displacing the market completely, the company of reel photographs that was declared bankrupt in 2012. Kodak currently exists and tries to come back afloat by exploring other business alternatives.

4. Decca Records

Towards the beginning of the 60s, a small group composed of four young artists and dreamers born in Merseyside County, in the North West region of England made an audition in the new year of 1962, played and recorded about 15 songs for an hour and they left the material at the disposal of the label so that they would make the decision to sign them as new figures of music.

Decca, had as head of the Pop Division for the time Dick Rowe who told the manager of the young musicians, Brian Samuel Epstein, a phrase that was recorded for the universal history of music: "The guitar groups are coming out, Mr. Epstein "and added, "Mr. Epstein, we do not like the sound of your children".

These children were highlighted by Billboard magazine as one of the 100 best-selling artists in the first place, they were awarded with 15 Ivor Novello prizes and 28 Grammy Awards and a number of gold, platinum, and multiplatinum albums and were known as The Beatles.

Read also: Memes: an innovative business

5. Atari

The forerunner of home video game consoles broke because of a series of errors committed by their high confidence in being pioneers and dominant in the family entertainment market.

Those who were leaders in the 80s, declared bankruptcy in 2013 after leaving marked the childhood and youth of several generations. The search for technological innovation in their teams was one of the most painful mistakes made by this business giant . The technical failures presented by the consoles launched to the market was a situation that their taxpayers did not forgive, but that their competitors knew how to take advantage of since these technological failures did not represent a real challenge for their more direct competitors Nintendo and Sony.

Finally, the most unfortunate mistake, which perhaps cost more to this company was the launch of the game ET the Extraterrestrial, successful 80s film directed by Steven Spielberg. The game was a disaster and the fans of Atari did not like it at all: poorly programmed and totally disconnected with the story of the film, it did nothing but generate economic losses to the company. Now Atari, who spent years hand in hand by different owners, is dedicated to the programming of games for casinos and sale of advertising material taking advantage of the brand.

 

LatinAmerican Post | Alberto Castaño Camacho

Copy edited by Juliana Suárez

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