Bismarck alone could not deter the Royal Navy battle line

Did Bismarck demonstrate the failure of public naval deterrence?

No; one late 15-inch battleship did not constitute the balanced, powerful fleet required to deter the Royal Navy.

At the start of the war Germany's operational capital ships, Scharnhorst and Gneisenau, carried 11-inch guns. Bismarck entered service too late to shape the initial deterrence calculation, and one 15-inch battleship could not substitute for a balanced fleet. A credible German fleet deterrent would need multiple ships able to challenge Nelson and Rodney and survive against the wider British battle line. Italy fielding a much larger group of Littorio-class battleships would pose a markedly different problem. Deterrence depends on usable force structure rather than the reputation of one famous ship.