dimanche 29 mai 2011

Blockbuster reaction. First step

Blockbuster, sold to Dish Network ($320 million), "restructures" and closes stores. How many? It depends on the negociations with studios for DVDs.
On the marketing side, Blockbuster starts a new DVD rental pricing policy:
For new movies, $2.99 / day ; for older movies $1.99 instead of the previous $4.99 for a three day rental. Blockbuster has always been known by its customers for offering newer movies than its competition.
  • The pricing is still far from redbox $0.99 / day. And from Netflix. But neither can rent new releases. They must wait 28 days for Universal, Time Warner and Fox movies. Blockbuster is 28 days ahead of them both thanks to its higher price. This is its main trump card.
  • The final equation for video rentals has three main variables: price, novelty, convenience. Blockbuster maximizes profit under these three constraints.
Next step? The digital offering. It is still to come, and might increase Blockbuster's power and image. Providing more convenience to people more at ease with digital culture. The video battle goes on.

    Aucun commentaire: