Comments on: From Rental To Retail – Blockbuster Begins Evoloution Towards New Rental Paradigm http://davisfreeberg.com/2007/11/14/from-rental-to-retail-blockbuster-begins-evoloution-towards-new-rental-paradigm/ Wed, 31 Aug 2011 01:39:44 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Jean http://davisfreeberg.com/2007/11/14/from-rental-to-retail-blockbuster-begins-evoloution-towards-new-rental-paradigm/comment-page-1/#comment-180955 Jean Wed, 03 Dec 2008 10:09:50 +0000 http://davisfreeberg.com/2007/11/14/from-rental-to-retail-blockbuster-begins-evoloution-towards-new-rental-paradigm/#comment-180955 Thanks for this great article. However it s really tough time for media retailers. For the first time, this year digital sales have been superior to classic sales. But the total is going down.... Thanks for this great article. However it s really tough time for media retailers. For the first time, this year digital sales have been superior to classic sales. But the total is going down….

]]> By: Der Senator http://davisfreeberg.com/2007/11/14/from-rental-to-retail-blockbuster-begins-evoloution-towards-new-rental-paradigm/comment-page-1/#comment-102684 Der Senator Mon, 19 Nov 2007 02:03:44 +0000 http://davisfreeberg.com/2007/11/14/from-rental-to-retail-blockbuster-begins-evoloution-towards-new-rental-paradigm/#comment-102684 As the previous commentator correctly states, BB tried "rentailing" under the prior management. It was a non-starter. They will never build a meaningful business in electronics due to the simple fact that they cannot compete on price. (If Circuit City can't make money in this category, do you really think BB is going to do better? Please.) This is the same reason why they were unable to make money selling DVDs, which I think you have to admit is much closer to their core competency. They can probably raise the average customer ticket through better merchandising of candy, food, gift cards and movie-related merchandise. Unfortunately, Keyes & co. have already shot themselves in the foot by turning off Total Access, which was the first program in recent memory to significantly increase store traffic (not to mention the first thing to generate positive PR for the brand in years). Instead, they are now shedding subscribers at the rate of something like 50,000 per week, a significant percentage of whom are pissed off and highly unlikely to re-up. As the previous commentator correctly states, BB tried “rentailing” under the prior management. It was a non-starter. They will never build a meaningful business in electronics due to the simple fact that they cannot compete on price. (If Circuit City can’t make money in this category, do you really think BB is going to do better? Please.) This is the same reason why they were unable to make money selling DVDs, which I think you have to admit is much closer to their core competency. They can probably raise the average customer ticket through better merchandising of candy, food, gift cards and movie-related merchandise. Unfortunately, Keyes & co. have already shot themselves in the foot by turning off Total Access, which was the first program in recent memory to significantly increase store traffic (not to mention the first thing to generate positive PR for the brand in years). Instead, they are now shedding subscribers at the rate of something like 50,000 per week, a significant percentage of whom are pissed off and highly unlikely to re-up.

]]> By: Chris http://davisfreeberg.com/2007/11/14/from-rental-to-retail-blockbuster-begins-evoloution-towards-new-rental-paradigm/comment-page-1/#comment-101540 Chris Fri, 16 Nov 2007 19:57:22 +0000 http://davisfreeberg.com/2007/11/14/from-rental-to-retail-blockbuster-begins-evoloution-towards-new-rental-paradigm/#comment-101540 While retail ambition seems admirable… It also seems that Blockbuster has already dabbled and failed with some retail focus endeavors…. What will be “so” different with Keye’s new ideas? Aren’t some of these ideas things Blockbuster has already tried or tested in the past? • Directv – Kiosks formerly in Blockbuster stores (Did anyone buy a Directv system at BB? Were the employees trained to sell it?) • Radio Shack Mini-Stores – Formerly in select Blockbuster stores (These seem to have disappeared) • Game Rush – Select stores already have/had specialized gaming store-in-store with in store demo unit and consoles for sale. (Didn’t appear to take off like they thought) On with the show! Should be interesting to see what happens.. While retail ambition seems admirable… It also seems that Blockbuster has already dabbled and failed with some retail focus endeavors…. What will be “so” different with Keye’s new ideas? Aren’t some of these ideas things Blockbuster has already tried or tested in the past?

• Directv – Kiosks formerly in Blockbuster stores (Did anyone buy a Directv system at BB? Were the employees trained to sell it?)

• Radio Shack Mini-Stores – Formerly in select Blockbuster stores (These seem to have disappeared)

• Game Rush – Select stores already have/had specialized gaming store-in-store with in store demo unit and consoles for sale. (Didn’t appear to take off like they thought)

On with the show! Should be interesting to see what happens..

]]> By: davis http://davisfreeberg.com/2007/11/14/from-rental-to-retail-blockbuster-begins-evoloution-towards-new-rental-paradigm/comment-page-1/#comment-101243 davis Thu, 15 Nov 2007 23:37:44 +0000 http://davisfreeberg.com/2007/11/14/from-rental-to-retail-blockbuster-begins-evoloution-towards-new-rental-paradigm/#comment-101243 Mr. Senator - I don't believe that Blockbuster needs to sell their high ticket items at a "premium", in order to return to profitability, they need to figure out a way to increase the amount of revenue per customer. I think we'd both probably agree that they won't make by selling $4 rentals. GameStop has shown that they can turn a profit on $60 games, so I'd start by pointing out some low ticket items that would make sense to better support. Above and beyond that, I think Plasmas, Mp3 players and cell phones would make the most sense. If generic cell phone kiosks at the mall, can succeed even though they are paying top dollar for rents, then I believe that Blockbuster could as well. I don't think that people are going to think to themselves, I'm in the market for a TV, lets go to Blockbuster, but they will purchase items, especially if they are convenient. As far as Total Access goes, it was terrible for the business and demonstrated how flawed Blockbuster's prior management was in their thinking. Blockbuster will need to transition to digital rentals, but they need to return to profitability first and I think that this plan has the right ingredients to make it happen. It's not a slam dunk, but it certainly didn't warrant a 20% sell off on an already battered stock. It's OK if you don't agree with me, but I think that the market misunderstood, what Keyes is up to. Mr. Senator – I don’t believe that Blockbuster needs to sell their high ticket items at a “premium”, in order to return to profitability, they need to figure out a way to increase the amount of revenue per customer. I think we’d both probably agree that they won’t make by selling $4 rentals. GameStop has shown that they can turn a profit on $60 games, so I’d start by pointing out some low ticket items that would make sense to better support. Above and beyond that, I think Plasmas, Mp3 players and cell phones would make the most sense.

If generic cell phone kiosks at the mall, can succeed even though they are paying top dollar for rents, then I believe that Blockbuster could as well. I don’t think that people are going to think to themselves, I’m in the market for a TV, lets go to Blockbuster, but they will purchase items, especially if they are convenient.

As far as Total Access goes, it was terrible for the business and demonstrated how flawed Blockbuster’s prior management was in their thinking. Blockbuster will need to transition to digital rentals, but they need to return to profitability first and I think that this plan has the right ingredients to make it happen. It’s not a slam dunk, but it certainly didn’t warrant a 20% sell off on an already battered stock. It’s OK if you don’t agree with me, but I think that the market misunderstood, what Keyes is up to.

]]> By: Der Senator http://davisfreeberg.com/2007/11/14/from-rental-to-retail-blockbuster-begins-evoloution-towards-new-rental-paradigm/comment-page-1/#comment-101211 Der Senator Thu, 15 Nov 2007 21:21:27 +0000 http://davisfreeberg.com/2007/11/14/from-rental-to-retail-blockbuster-begins-evoloution-towards-new-rental-paradigm/#comment-101211 PLEEEEEEEEEEEEASE tell me what "high-ticket" items you think people will be prepared to pay a premium for at Blockbuster versus a big box retailer, Costco etc. They were never competitive selling the very product their stores specialized in. You think they can move iPods? Wiis? Dyson vacuums? Total Access was their only prayer to stay relevant. This guy Keyes is smoking his own press releases. PLEEEEEEEEEEEEASE tell me what “high-ticket” items you think people will be prepared to pay a premium for at Blockbuster versus a big box retailer, Costco etc. They were never competitive selling the very product their stores specialized in. You think they can move iPods? Wiis? Dyson vacuums?

Total Access was their only prayer to stay relevant. This guy Keyes is smoking his own press releases.

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