n, 2009).
百视达公司的最初业务策略以及公司失利的原因—Blockbuster Inc’s Original Business Strategy and why it Failed
The company’s original strategy was to open up as many stores as possible in different areas. It thought this to be the best way to capture a huge share of the market. And true, it did get a large share of the market. However, this strategy was not suitable, as it led to increase in operating costs. The revenue generated was used to cater for the running costs. In essence, the company did not gain much; the huge profits made were used to cover the high cost incurred. Furthermore, a large chain of stores is harder to operate and co-ordinate than a smaller chain. Consequently, this strategy was proven ineffective.
The other strategy was to stock up on the latest releases in the movie scene. The company thought it was better to have more of the newer movies, and less of the older ones. Space taken up in storing old movies was cleared to store newer movies. While this strategy made complete sense, it failed because customers still demanded classic movies. The strategy failed because of the limited variety of games and movies in the store. In addition to the limit in variety, the numbers of copies of a particular movie are in limited supply.
The result is inconveniencing the customers, causing them to either wait until one of the copies is returned, or go to another store. This meant that they walked away with money that Blockbuster Inc. could have otherwise made. The end result is a loss of credibility and customers for the company. Blockbuster focused too much on newly released movies at the expense of the old ones, forgetting that classic movies can still be in demand. This contributed to the rise of Netflix and Redbox, its competitors. These two outlets had more enough stock on old and new movies, resulting in customer satisfaction.
The second reason for their failure is their unreasonably high prices. Blockbuster charges high prices for their movies, making room for competition, particularly from Redbox, the DVD kiosk. Redbox charges only $1 per movie, attracting a large number of customers. On the contrary, Blockbuster refuses to lower its prices, still charging $5 for a movie, even in the presence of such still competition. In addition to good prices, Redbox offers a wide variety of movies to choose from, both old and new releases. An even stiffer competition comes from Netflix. Netflix offers its customers a chance at subscribing for movies. At only $8.99 a month, a customer can access all the movies they want.
2011年的竞争问题—2011 Competitive Issues
Price remains one of the key competitive issues for Blockbuster Inc. the company refuses to lower the price of its movies, creating a niche for local movie stores. Netflix and Redbox have taken advantage of this opportunity and are charging a much lower price for the same products. For effective competition, these two companies have stationed their stores right next to Blockbuster sto
