Esss

Q. 1 Discuss briefly the significant features of Redbox's business model. Be sure to include details of cost structure, core capabilities, distribution channels and technology used in this mode

Ans. Redbox business model is simple, It offered DVDs at very attractive price ($1/day) to consumers on rental basis through automatic Kios's. The biggest advantage to consumer that he could a product of $20 in just $1 very conveniently. Redbox installed Kiosks at different locations (McDonalds & other big reatil stores) where cosumer can move & can select movie as per his choice & can return next day after watching it. In case of non-return penaly was just $1 again for the day.

Each kiosk carries about 500 DVDs, all of them recently released flicks. Redbox says the selection process is part art and part science. Large and medium box office films automatically make the cut, while a purchasing team selects lesser-known titles based on customers' perceived interest.

Customers select their movies using a touchscreen and swipe a credit or debit card for payment. Each movie costs $1 per night to rent; if the movie isn't returned, charges cease after 25 days and the customer owns the movie.

The model seems to be working. Redbox went from 93,000 rentals in 2003 to 21 million rentals in 2006. The company recently surpassed 50 million rentals. Redboxes are found in McDonald's restaurants and in numerous grocery store chains, including Giant Food stores, Albertson's and Wegman's.

Redbox is a leading provider of movie and game rentals in the Nation. Redbox offers self-service DVD rentals through over 22,400 kiosks throughout the United States, Puerto Rico, and the United Kingdom. In 2004 Redbox began spreading automated vending machine kiosks containing by and large new release movie DVD’s in high traffic shopping locations. Its products and operations include Kiosk DVD rental, online disc rental reservation, no late fee, recently released movies, and video game rental....