Free versus Chain Video Rental Stores.

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Free versus Chain Video Rental Stores. Bunch Individuals: David Sarotte Scot Runke Tinoush Shifteh Katie Valentine Lorie Vogel Tiffany Lamontagne. Presentation.
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Free versus Chain Video Rental Stores Group Members: David Sarotte Scot Runke Tinoush Shifteh Katie Valentine Lorie Vogel Tiffany Lamontagne

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Introduction Purpose think about free versus chain feature rental stores Picked two chain stores Hollywood Video Blockbuster Video Picked two autonomous stores Thomas Video – Royal Oak Video Jack – Farmington Hills Research Methods Interviews Year End Company Financials Trade Journals

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Introduction Topics secured amid store meetings included: Site choice Trade region examination Customer relationship advertising (CRM) Merchandising Inventory methodologies Competition Strategy E-Commerce/Website

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Introduction Topics concentrated on in presentation include: History of chain stores Including little business point of view Overview of residential feature market Analysis of Video Stores

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History Of Chains have for the most part impacted the accompanying store sorts Variety Stores Grocery Stores Restaurants Department Stores Drug Stores In 1982, these 5 sorts of stores represented 40% of retail deals in the United States First chain stores can be followed back to the American provinces Before 1930, Department Stores were the conspicuous chains Food retail locations were likewise enormous chains preceding 1930 Piggly Wiggly and A&P - Grocery Chains Harvey House - first eatery opened in 1854 Woolworth’s was the most established mixed bag store and had 2100 stores and yearly deals over $273 million in 1929

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History Of Chains Expansion of chains impeded in the 1930’s and 1940’s Growth continued after World War II Lebhar (1963) said three patterns influenced chains The development of rural arranged strip malls The development of rebate store retailing The development of government resistance to ties Small organizations started to protest the development of chains Legislation instituted Anti-chain charges Resale value controls Antitrust regulations Robinson-Patman Act (checks chains purchasing preferences)

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Chains v. Little Businesses Size Chains can purchase items in mass and get mass markdown Chains can stand to produce, circulate, or wholesale in the event that they pick Small organizations don\'t have the cash-flow to put resources into these “backward integrated” exercises Human Resources Chains can better bear the cost of master directors and preparing projects Chains hazard more turnover among representatives than little organizations. Expectation to learn and adapt Faster expectation to learn and adapt for chains on the grounds that same choices are made again and again - prompts simpler extension procedure Chains are more institutionalized Price/administration Tradeoff Offering lessened costs may give up client benefit Small organizations have more customized client administration.

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Small Business Perspective Small organizations must have the capacity to separate themselves from their rivals Conant, Smart, and Solano-Mendez did an investigation of little retailers in 1993 that discovered Merchants and claim to fame retailers with plainly characterized technique designs both have wellspring of-point of preference ability prevalence along a mixture of showcasing skills Perform superior to anything the retailing sorts that have advertising procedures that are misty and need accentuation. Ozment and Martin in 1990 demonstrated The vicinity of a markdown retail chain in a provincial territory does influence the number, size, and offers of little retail foundations A rebate retail chain will impact the development (or decrease) in the number, size, or offers of retailing after some time.

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Next Steps Take a gander at how chains and little organizations toll in the feature store industry. Blockbuster Hollywood Video Jack Thomas Video

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Video Rental Industry Overview Consumer Spending: ($billions) 1990 2000 2010 $10.1 $20.6 $31.1 90% of U.S Households with TVs Own VCRs

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Video Rental Industry Overview Video Rental Competitive Advantages: Entertain one or more individuals at a sensible cost Ability to peruse numerous films Control review experience Consumer ready to see new discharges before appearing on digital TV

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Video Rental Industry Overview Video Rental Competitive Advantages: Revenue-imparting assentions to significant motion picture studios Per feature tape expense for “sell-through” motion pictures Percentage of feature store income for real discharges

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Video Rental Industry Overview Major Industry Threats: Change in association with real motion picture studios Developing innovations: Satellite TV Digital link frameworks - “Video on demand”

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Blockbuster - Did You Know? Blockbuster works more than 7,700 feature stores in 26 nations Blockbuster had 52 million U.S. part accounts dynamic amid 2001 Blockbuster had over $5 billion in deals income for 2001

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Blockbuster - Did You Know? The biggest Blockbuster store is 20,433 square feet, situated in Dayton, Ohio The littlest Blockbuster store, only 772 square feet, is situated inside a Kroger grocery store in Euless, Texas Blockbuster’s brand acknowledgment is about 100% with dynamic motion picture leaseholders

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Blockbuster - Franchising Opportunities The fantasy can be yours: Minimum total assets of $400,000 Minimum liquidity of $100,000 Required: One-time advancement expense One-time establishment charge Continuing sovereignty, administration charges Usage charges for Blockbuster programming

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Blockbuster - Site Selection Blockbuster new store improvement group Utilizes a land and client exchange database to profile: Density of neighborhood populace Local demographics Visibility & availability

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Blockbuster - Site Selection Most attractive: High-perceivability remain solitary structures or Prominent areas Blockbuster rents all corporate-run store offices

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Blockbuster - Marketing & Advertising Focused on corporate marking fundamentally through TV and radio Adjusts publicizing territorially in light of: Market offer Brand mindfulness in respect to rivalry New industry patterns Local demographics

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Blockbuster - Marketing & Advertising Blockbuster Rewards Program Blockbuster Giftcards Blockbuster Ticket & DirectTV Alliance with Coca-Cola 2001 promoting spending plan $215 million

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Hollywood Video-Introduction Founded in 1984 World’s second biggest feature chain 1800 Hollywood Video retail superstores in 47 states all through the U.S. Mission: “To build up Hollywood as the debut supplier of diversion items around the world, by giving an agreeable spot to clients to go and get the amusement they need, when they need it.”

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Hollywood Video-Retail Strategy Between 1987 and 2000, fast development and extension through new store openings were top need By 2001, procedure changed to one of income development from existing stores. Key components of current business technique include: Broad choice and predominant accessibility Creating an energizing, charming, and advantageous shopping background Providing incredible amusement esteem Expansion of item opportunities

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Hollywood Video-Site Selection Focused on natural development (95% of stores were opened as new stores) Value significance of site choice to achievement of the Company Principal criteria for site determination: Local private populace thickness Traffic depend on neighboring streets Visibility and openness of store Availability of adequate stopping Overall, most alluring areas are in high-perceivability, remain solitary structures or in conspicuous areas in multi-occupant strip malls.

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Hollywood Video-Merchandise Each store conveys 8,000 titles and 15,000 videocassettes, DVDs, and computer games for rent Revenue imparting to studios – brought about 100 to 300 duplicates of hit motion pictures titles per store Also offer VCRs, DVD players, and amusement players for rent Offer clear features, feature cleaning gear, and confectionary things available to be purchased Maintain nitty gritty stock frameworks to track rental action Allows administration of purchasing, appropriation, and aura of motion pictures

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Hollywood Video-Pricing Offer 5-day rentals on all items New discharges $3.79 Catalog titles $1.99 Hollywood Video ensures accessibility of new discharges or free

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Hollywood Video-Atmospherics Stores are intended to catch fervor of motion picture industry Interior is spotless, brilliantly lit; encompassed with beautiful paintings; feature screens playing motion pictures Exterior has vast HOLLYWOOD VIDEO signs in splendid hues Movies sorted out in 28 classes, masterminded in order arrange New discharges showed around external dividers for less demanding scanning Overall climate is of fun and energy

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Hollywood Video-ECommerce Acquired in 1998 – was the main online destination for film related substance and business Offered broad determination, motion picture depictions, pundits surveys, appraisals, suggestions, and permitted review of motion pictures before buy Reached $80 million in income by 2000, yet created noteworthy misfortunes E-Commerce webpage was shut and is currently content just Hollywood Video’s site gives data on top hits, another discharge calendar, Company bulletin, store locator, client administration, and access to record data

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VIDEO JACK OVERVIEW Video Jack is a little autonomously claimed feature store situated close Grand River and Drake in Farmington Hills. While they don\'t have the atmospherics of Blockbuster or Hollywood Video, they do have an amazingly advantageous area, which is doubtlessly their most striking trait. They perceive the significance of relationship advertising and their clients have a tendency to be very steadfast in view of this.

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VIDEO JACK SITE SELECTION When Video Jack pick their present area, their principle goal was taking responsibility for effectively existing feature store. They are strategically placed

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