The Danger of Industry Blindness: How Failing to Look Beyond Industry Can Hold You Back

In business, competition drives companies to improve, innovate, and evolve. However, when companies only look at their direct competitors for inspiration—without considering broader market trends and lessons from other industries—they risk stagnation and even failure. Industry blindness is a dangerous trap that can prevent companies from recognizing disruptive changes and adapting in time. Below, we explore three cautionary tales of companies that failed to look beyond their own industries and, as a result, missed critical opportunities to innovate and survive.

Blockbuster: Stuck in the Video Rental Mindset

Industry: Video Rental

Missed Opportunity: Learning from digital platforms like Netflix, Apple, and Amazon

Blockbuster was the undisputed leader in the video rental industry during the 1990s and early 2000s. However, instead of paying attention to shifts in digital consumption and customer convenience, Blockbuster remained fixated on competing with other brick-and-mortar rental businesses like Hollywood Video. Meanwhile, Netflix introduced a DVD-by-mail service and later pivoted to streaming, capitalizing on digital transformation and changing consumer habits. When Netflix approached Blockbuster in 2000 with an offer to be acquired for $50 million, Blockbuster’s leadership scoffed at the idea. Fast forward a decade, and Blockbuster was bankrupt, while Netflix became a media powerhouse. Had Blockbuster looked outside of traditional video rental and studied the rise of digital platforms, it might have pivoted early enough to remain competitive.

Kodak: Too Focused on Film

Industry: Photography & Film

Missed Opportunity: Learning from digital and consumer electronics companies

Kodak was once the king of photography, pioneering much of the technology that fueled the film industry. Ironically, it even invented the first digital camera in 1975 but shelved the idea, fearing it would cannibalize its film sales. Instead of paying attention to emerging digital trends in consumer electronics, Kodak remained obsessed with competing against Fujifilm in the traditional film market. Meanwhile, tech giants like Sony and Apple capitalized on digital photography, integrating cameras into their devices. By the time Kodak tried to enter the digital space seriously, the market had already moved on. It filed for bankruptcy in 2012, having missed the opportunity to redefine itself as a leader in digital imaging.

BlackBerry: The Fall of a Mobile Giant

Industry: Mobile Phones

Missed Opportunity: Learning from software-driven tech companies like Apple and Google

BlackBerry was the go-to mobile device for professionals in the early 2000s, thanks to its secure messaging and physical keyboard. However, instead of looking at broader technology trends—such as the rise of touchscreens, app ecosystems, and user-friendly interfaces—it remained focused on making minor improvements to its existing models. When Apple introduced the iPhone in 2007, featuring a full touchscreen and a revolutionary app store, BlackBerry dismissed it as a novelty. Meanwhile, Google developed the Android ecosystem, further reshaping the smartphone market. By the time BlackBerry attempted to pivot, it had already lost relevance, eventually exiting the smartphone market altogether.

Conclusion

The stories of Blockbuster, Kodak, and BlackBerry serve as cautionary tales for businesses that focus too narrowly on their industry rivals instead of taking inspiration from broader market trends. Innovation doesn’t always come from within; sometimes, the biggest breakthroughs come from outside your industry. Companies that continuously explore new ideas, technologies, and business models—rather than just competing within their existing framework—stand a much better chance of adapting, thriving, and avoiding the fate of these fallen giants.

For businesses looking to stay ahead, the lesson is clear: don’t just benchmark against your industry—look beyond it. The next game-changing idea might come from a completely different market.