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Category: Business and Industry
Date Submitted: 02/21/2011 06:30 PM
Blockbuster Video Research Project
Presented to:
Dr. Andrew Kuchar
MGT 6627
Specialized Study
Presented by:
LaKisha Hopson
MSM Program, Troy State University
December 5, 2010
Introduction
Background
Blockbuster Video is one of the leading global providers of in home movie and game entertainment, with over 9,000 stores throughout the Americas, Europe, Asia, and Australia. A part of their mission is to provide home entertainment to consumers however they want to receive it. The emergence of options available to deliver movies to households has given Blockbuster enormous opportunities to capitalize in its legacy. Yet, it continues to shut its doors, closing 526 stores within the last few years. Respectfully, their digital revenue has more than doubled itself within the last year and continues to rise. Once the leader in rentals and the place where practically everyone found time to stop after work and pick up a few movies, Blockbuster is now a shadow of its former self. Competitors, suspect management, and evolving industry dynamics have rocked the company, leaving it in a precarious position. And unless it moves quickly to improve its business model and shore up its position in the market, it may become an irrelevant company with little chance of survival.
In spite of revenue loses, Blockbusters biggest asset and problem are the long- term leases it has on its 9,000 retail stores. The numbers are beginning to show that the convenience of online rentals has hurt the business of the traditional video stores. Blockbuster now feels it ready to embark on a new venture to reinvent itself as a “new media” company. Attempting to follow its consumers who are swaying to other means of obtaining what they want and how they get it.
There are several questions to answer in order for Blockbuster to become the complete source for home entertainment. Faced with the rising cost of fuel, should consumers continue driving to stores to...