Redbox SWOT Analyisis

943 Words2 Pages

Negative change in contracts with movie studios (price; discontinue)

Companies like Netflix that have been in the movie streaming industry for many years, and have a large portion of the market for streaming movies make it difficult to others to enter into the online movie rental industry. Netflix has already established a large library of movies and TV shows available for its members. It would take Redbox a number of years and resources in order to catch up with the infrastructure that Netflix already has available and ready for the consumer right now. Redbox would need to analize the opportunity cost of going into a new market or staying and investing in the current kiosks market and making sure that it is the best it can be. Redbox may be subject to others entering into the kiosks market to tap in on a low cost profitable business model. Blockbuster announced the intentions of entering into the kiosks market, which would have taken some of Redbox's share of the profits in a small percentage. However, in 2012 Redbox purchased Blockbuster kiosks business. According to LA times:

That evidence was clear Monday as Redbox, the nation's largest DVD rental company, agreed to spend up to $100 million to acquire Blockbuster-branded DVD kiosks operated by its largest rival, NCR Corp., adding about 9,000 machines to its existing 35,400 (LA times 2012).

It is apparent that with Redbox's strong financial position in the marketplace it will be difficult, but not impossible for other kiosks movie rentals to appear.

SWOT analysis conclusion:

In Conclusion, the SWOT analysis shows that Redbox has many strengths to be profitable and has the potential for future growth in the industry. The DVD movie rental industry is still s...

... middle of paper ...

...ntil they are charged full price of the movie.

Deploy more kiosks with the projected profitability of $50,000 or more.

Expand outside of the U.S., Puerto Rico and United Kingdom (where technology is moving at a slower pace and people are not as familiar with Netflix or VOD).

References

Blu-ray discs: 'We're not dead yet'. (n.d.). Retrieved April 13, 2014, from http://www.consumerreports.org/cro/news/2013/05/blu-ray-discs-we-re-not-dead-yet/index.htm

DEG Releases Year-End 2013 Home Entertainment Report - DEG. (n.d.). Retrieved April 12, 2014, from http://www.degonline.org/news-releases/deg-news/deg-releases-year-end-2013-home-entertainment-report/

Gamble, J., & Thompson A. A. (2013). Redbox's Strategy in the Movie Rental Industry. In Essentials of strategic management: The quest for competitive advantage (pp. 295-303). New York, NY: McGraw-Hill/Irwin.

Show More
Related

  • Cineplex Inc Case Study

    1180 Words  | 3 Pages

    Cineplex Inc. is a Canadian Film Exhibitor company that operates only in Canada for the time being. It operates in the Entertainment industry, and pretty much has a monopoly over the movie theatre and film exhibition sector in most parts of Canada. However, the current data in Canada suggests that Video-On-Demand (VOD) popularity is experiencing a rather rapid increase, followed by an increase in sector’s development and revenue all around. Nowadays, all of the major Canadian broadcasting companies -- such as Rogers -- offer some sort of VOD service to their customers.2 Therefore, the net attendance of movie theatres, Cineplex Inc. in particular, inevitably go through a yearly drop. On the other hand, the industry is constantly growing and attempting to overcome its obstacles by introducing new features and services. Therefore, the profitability of the industry is constantly sustained.

    Read More

  • Analysis of Blockbuster Video

    991 Words  | 2 Pages

    In 1985, Blockbuster opened its first store in Dallas, Texas. After the first few stores opened, founder David Cook built a six million dollar warehouse, which could pull and package multiple stores in a day. Blockbuster’s ability to customize a store to its neighborhood, loading it up with films geared specifically to demographic profiles in addition to the popular new releases, and a sizable collection of catalog titles. Blockbuster had instant success. In the early 1980’s and 1990’s Blockbuster put neighborhood mom and pop video stores out of business by offering better selection and convenience. However, success like that enjoyed by Blockbuster can foster arrogance. For Blockbuster, arrogance meant they believed they could do anything within their stores. For example, Blockbuster purchased Sound Music and Music Plus chains. This move took Blockbuster from movies to music. Secondly, this Blockbuster Music meant they were no longer renting now they were selling.

    Read More

  • Analysis of HMV

    2915 Words  | 6 Pages

    With the rise in digital downloads such as on iTunes, HMV lost 36million in August 2012 due to streaming online and downloading music online, music and DVD sales were down by 20% in the run up to Christmas 2012. (Wood, Z. Milmo, D. 2011) HMV’s market share in January 2013 had fallen to 17% a low figure compared to Amazons which was 23% at this time. (Lawson, A 2013). With a falling market share a company begins to lose sight of the market and drastic changed need to be made to meet customer demands and to keep ahead of rivals.

    Read More

  • Blockbuster LLC Case Study

    245 Words  | 1 Pages

    Blockbuster’s competitors, specifically Netflix went public in 1997 and by May of 2002, Netflix was able to attract just under $95 million in its public offering, and this is what caused the decline of the company because between the years of 2003 and 2005, Blockbuster’s market value plummeted by 75%. In 2010, Blockbuster filed for bankruptcy and was bought in auction by Dish Network and remains as subsidiary with only about 50

    Read More

  • Redbox Automated Retail

    899 Words  | 2 Pages

    In November 2005, Coinstar, known for its expertise in placing kiosks in high traffic locations, bought 47 percent of redbox making it a separate company from McDonald’s. The DVD rental kiosks quickly branched out into grocery stores, convenience stores, drug stores and mass-merchant shops. In February 2009, purchased all of redbox from McDonald’s. As Coinstar as its parent company, redbox is leading the way in video rental kiosks (The History, 2014).

    Read More

  • Blockbuster Video Analysis

    1599 Words  | 4 Pages

    The video rental industry was one of the more growing services retailers in the mid-1990s. However, due to Blockbuster, many rental video companies have failed to compete against this category killer. West Coast Video, Video City, and Hollywood Video, which are among the few and only large competitor’s of Blockbuster in the tri-state area. Many family-owned video rental stores could not compete against Blockbuster’s assortment of videos.

    Read More

  • Online Pay-Per-View Movies

    2696 Words  | 6 Pages

    I choose to discuss the topic of the internet as a new medium for pay-per-view movies because I feel it is a very fresh and new topic that has not been discussed, nor received much attention. The onset of this new medium comes from an attempt to deter online movie pirates from stealing the movies to actually purchasing them for a low price. I feel this is especially important for me to be writing this on a college campus because that is where a great deal of movie pirating occurs due to the fast online connections that the universities provide. File sharing programs like Kazaa and Limewire run ramped on college campuses making this an interesting alternative to explore. With this subject hitting close to home, I choose to research it and find out why it would be a good alternative to the free downloads that we receive from online people to people file-sharing programs. While there are a few sites out there that offer this kind of pay-per-view service, I choose to specifically focus on the site Movielink.com because it is backed by five major Media Corporations comprised of Universal, Sony, Metro-Goldwyn-Meyer, Paramount, and Warner Brothers. For this reason, it was the ideal internet site to explore to show the recent trend towards getting new movies online, even if only for a short time.

    Read More

  • Netflix SWOT Analysis

    1425 Words  | 3 Pages

    Therefore, Netflix has fewer problems predicting revenue. ? Netflix enjoys lower fixed costs due to the fact that it is an online DVD rental company. As an internet business, Netflix incurs less overhead costs than competitors such as Blockbuster, as well as having fewer employees to operate the physical locations, thus labor costs are greatly reduced. ? Netflix gives customers unlimited access to the largest selection of DVDs. Netflix?s video library consists of over 45,000 titles, making their selection the worlds largest, beating out Blockbuster, Movie Gallery, and Hollywood Video. ?

    Read More

  • Netflix Inc.

    1502 Words  | 4 Pages

    The average Blockbuster store carries roughly 1,500 movie titles. Netflix carries more than 12,000 titles. It has movies that you can't find anywhere else. And Netflix uses collaborative filtering technology to send you emails that alert you to movies that you might otherwise never consider. Netflix saw the video- and game-rental market moving to DVD and built its business around that trend. Netflix doesn't rent videocassettes, only DVDs (in part because they're lighter and cheaper to mail). Netflix was able to identify and implement a strategy fo...

    Read More

  • Redbox Entertainment Industry

    564 Words  | 2 Pages

    Trends and technology advancements over the years have impacted the way people perceive, access, and consume what is made available to them. While the glorious days of the movie industry are over, there seem to be resurgence in movie consumption led by technologies that have enabled people to “bring the movies home”. Today, the home entertainment industry remains a trademark in the United States where it generated “18.3 billion dollars in consumer spending on Blue-Rays, DVDs and electronic copies of films and TV shows” in 2013, as to make it the number one country in the world in terms of media and entertainment consumption (Lang, 2014). Redbox Automated Retail, LLC built its success by bringing entertainment and convenience together. The company based in Oakbrook Terrace, Illinois, was able to penetrate major retail channels and to link the rental industry to high-traffic stores such as McDonald, Wal-Mart and 7-Eleven. Since 2004, Redbox has imposed itself as a leading player of the entertainment industry.

    Read More

  • Netflix Market Structure

    1515 Words  | 4 Pages

    The idea inspired Reed Hastings and Marc Randolph, and then they founded Netflix in Scotts Valley, California in 1997 (Netflix, 2014). The company comes into play by developing a subscription-based streaming platform for movies and television shows. Unlike the traditional movie rental businesses such as Blockbuster and Redbox, Netflix’s innovation offers service via Internet, and it does not have any physical stores but instead delivers DVDs through postal mail in the U.S. Since then, Netflix has become the world’s leading internet television network with constant growth of customers to over 48 millions members in more than 40 countries in the North America, Europe, and the Latin America (Netflix, 2014). In this analysis, the main focus is examining the current market environment for Netflix. It identifies the type of market structure that Netflix is currently competing. The analysis also expands on the competitions, product differentiation, pricing strategy, and measuring the level of easy entry-and-exit.

    Read More

  • The History of Netflix

    2022 Words  | 5 Pages

    Although Hastings vowed to be divergent from other video retailers, his goal was to use an identical pricing strategy; however, one that would “appeal to customers [. . .] who used online shopping as an alternative to traveling to retail outlets” due to ease of access and more preferences (Shih, Kaufman, & Spinola, 2009, p. 3). Furthermore, Netflix launched its business at a time DVDs had barely hit the marketplace as the firm anticipated the new technology to be a promising venture. Nonetheless, within a year DVD players became so vast...

    Read More

  • Netflix Challenges

    1005 Words  | 3 Pages

    There is strong competition with other companies that offer video streaming at no extra charge. Additionally, Netflix and its competitors are attempting to enter the digital world. Digitally offering television shows is an area of competition that has previously been controlled by

    Read More

  • Porter's Five Forces Analysis For The Movie Industry

    561 Words  | 2 Pages

    Movie theaters are conglomerates in the film industry. Only a few competing firms. Offer the same ticket prices and provide the same products and roughly the same services to customers.

    Read More

  • Advantages And Disadvantages Of Watching Movies In The Theater

    804 Words  | 2 Pages

    A movie theater has its advantages and disadvantages. One advantage is that people can see the showing of different movies that have been newly released. The disadvantage is that, that is all there is to it and nothing more. At home, you can control the variety and ways to watch a movie. People buy many movies to watch at home and it can be anything at any time even at any place. The only bad thing about it is that they cannot see any of the newest released movies that recently came out in theaters. There are two types of ways people watch movies at their homes. One way is people already own DVDs or have bought many of them and start watching them in their DVD players. The other ways are streaming a movie through the internet. For this to happen, people would mainly buy the monthly subscriptions such as Netflix, Hulu, or Amazon Prime. Through this subscription people do not only watch movies in their homes but they also watch television shows. The only downside is there is a very limited number of movies added onto these

    Read More

More about Redbox SWOT Analyisis

Open Document