...MGT 201 CASE ANALYSIS A New Blockbuster Image POINT OF VIEW The group will take the point of view of the Chairman of Blockbuster, H. Wayne Huizenga. As Chairman, he is director, decision maker, leader, manager and executor of the company and thus, in the position to solve and decide upon the dilemmas faced by Blockbuster regarding the issues on the diversification of the company. MAJOR PROBLEM From 1985 to 1992, Blockbuster has managed to become a video-rental giant. But by 1993, Blockbuster through its Chairman, H. Wayne Huizenga was seeking a new image, that of a multimedia company. Steps were taken towards this goal including sponsorships of concert tours, music retailing, television and film production and operating indoor children’s play centers. These diversification strategies, however, did not escape from several criticisms and by the fall of 1993, Chairman Huizenga had enough reasons to rethink of what he wanted for the company. The myriad of difficult decisions concerning Blockbuster’s future can be traced to the dramatic changes in the company’s strategic context. This and Huizenga’s hurried and scattered approach to diversification had put the company into danger. How should Chairman Huizenga address the criticisms that arise from his abrupt and scattered decisions on the diversification of Blockbuster? CASE FACTS Three factors that make up strategic context which could have helped Huizenga understand the opportunities and constraints set before...
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...head: THE RISE AND FALL OF A MAJOR ICON 1 The Rise and Fall of a Major Icon OL 500 - Q4586 Dawn Foens Abstract Companies rise and fall what makes and breaks them. How does this happen? During these ever changing times many corporations could fall short of adapting to change. This could lead to the destruction of their existence. We will take a look into a major icon of the twentieth century Blockbuster Video. We are going to take a look into the company to show how it changed the way we watched movies and the challenges the company faced over the years. What changes could have been made to save the icon? Did the company evolve with technology? What eventually brought it to its knees? Introduction Nothing to do on a Friday or Saturday night “let’s rent a movie someone says” they all jump in the car and go to the nearest corner where they are sure to find a Blockbuster Video store. Blockbuster Video was the largest movie rental company in the nation. Movies ranged in price from $1.99 to $4.00 the older the movie the cheaper the price. In order to rent movies you had to complete an application and open a membership based on your criteria you were allowed to rent a certain number of movies at a time. The normal limit was 3 at a time. The rental was for a day. Be aware if you rented all three and did not return them the next day you were charged another days rent. The price would be incurred the next time you rented a movie. Blockbuster was raking in the...
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...Blockbuster video Case study By Ange li n a I., An to n G., N ah ia n U. понедельник, 5 декабря 11 г. Introduction ability to analyze the company’s performance over the years is a duty of every manager. Today we are going to try to analyze and look deeper into the case of Blockbuster and it's evolution over the years .In order to do this, we are going to answer several questions, which will help you to understand the problems, that Blockbuster faced and solutions The it's implemented. понедельник, 5 декабря 11 г. понедельник, 5 декабря 11 г. Business problems and decisions Changing rental patterns. households acquired As more cable TV, customers no longer wanted to rent older videos. With the new approach, customers only cared about the new releases. But, at $65 a tape, those costs were high—and after about a month, people moved on to rent the next release, so the store no longer received money to cover the original purchase price. In 1997, CEO John Antioco found a solution. He negotiated a deal with the leading Hollywood studios. Blockbuster would purchase tapes for $6 upfront, then give the studios 40 percent of the rental revenue. Competitors could not match the cost savings. About 2,500 of them (10 percent of the U.S. market) went out of business. понедельник, 5 декабря 11 г. Business problems and decisions But, entertainment technology rolled on. By 2001, the world was quickly switching to DVDs late 2001, Blockbuster again had...
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...Industry: Blockbuster Case David Cook founded Blockbuster video in 1985, opening the first store in Dallas Texas and has grown to become the world's number one video chain. Mr. Cook took the idea of video rental and improved it by creating the video superstore concept. Many family-owned video rental stores could not compete against Blockbuster' stores. Blockbuster stores were highly visible stand-alone structures that appealed to customers. Blockbuster His stores had a wider selection of videos and offered longer hours of operation. He focused on creating a family image for his stores by including a children's section and excluding adult movies. He also made it possible for busy people and people with children the opportunity to view movies for a longer period by starting the 3 day rental period. In 1986, Mr. Cook sold 33% of Blockbuster to h, m & Flynn and in 1987; he decided to leave the company making Mr. Huizenga CEO (Smiley, 2010). Mr. Huizenga had experience growing small companies but no experience in retail, so he hired the best managers who were capable of developing a retail chain. Under Mr. Huizenga's leadership Blockbuster experienced major growth. By 1992, Blockbuster had over 3,000 stores (1,000 franchise and 2,000 company owned). Blockbuster had established 3 operating divisions to manage functional activities. These three divisions cut cost for the company by eliminating the outsourcing of these jobs. Years ago, almost everyone who rented a video got it from...
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...29 j ^ j j j j j j j j j j j j j j j j j j j j j j j j j j j j j j j j j ^ j j - i j j j j j j j j j j j j Video Concepts, Inc. cose wos prepared by John Dunkelberg and Tom Goho,Wake Forest niversity. All rights reserved to the authors and the North American Case Research Association. As Chad Rowan, the owner of Video Concepts, Inc., looked over his monthly income statement, he could only shake his head over how it could have been so much different. In many ways he was a very successful entrepreneur, having started and grown a profitable business. In other ways, he felt trapped in a long-term no-win situation. The question now was what should he do given the current business environment. Basically, Chad had a profitable business, but the profits were relatively small and had stopped growing since a strong competitor, Blockbuster Video, had moved into town. The profits, however, were not enough to pay off his long-term debts and provide him with any more than a subsistence living. In addition, the chances of selling his business for enough to pay off his debts and then start another business were not good. In reflecting on what might have been, Chad commented: I had really hoped to expand Video Concepts into several similar-sized towns within a couple of hours' driving distance from here. The financial projections, 'which had been fairly accurate until Blockbuster arrived, indicated expansion was possible. I thought I was growing fast and had put about as much capital into...
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...Letter of Transmittal From: Parul Srivastava To: Chad Rowan, Owner, Video Concepts, Inc., Lexington, North Carolina, United States. October 1,1993 Subject: Recommendation on future course of action to be adopted by Video Inc. I hereby attach the recommendations after analysing present Video Inc.. finances and the course of action to be adopted for the business. The report presents a overview of current problems on Video Concepts, Inc.. The various option available in future have been analysed upon the basic objective of economics that is profit maximization. Based upon the current trend of revenues, it is recommended that you should accept the alternative of hiring someone to manage the business and find a job for yourself preferably in corporate. Video Concepts, Inc Summary Situation Analysis Video concepts is facing stiff competition from Blockbuster ahich has certain adavatages like Problem: Should Chad continue with the current business and if yes should he continue being the manager or hire someone else and find himself some other job Options • Raising price of overnight rental to $2.49 per night • Hiring someone to manage the business and find another job for himself • Sell the business Criteria • Return on time and capital • Future prospects of video rental business • Personal Satisfaction Evaluation of Options Option 1 Option 2 Option 3 Recommendations Word Counts: 350 ...
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...market In 2004 the sell-through category accounted for 63% of the market; DVD sales were 52% of the overall market, while VHS sales were 11%. The rental category makes up the remaining 37% of the entire market, with DVD accounting for 26% and VHS nearly 11%. These figures reflect the shift in the market away from VHS and rentals, and towards DVD and sell-through. As evidence of the strength of DVD, most mass merchandisers have discontinued sales of VHS. Increases in hardware penetration drove sales Hardware ownership remains the primary driver for sales and rentals of video software. VCR penetration has remained static at over 90% of households, while DVD player ownership (market-entry hardware now retails for as little as $40) quadrupled to 39% penetration from 2000-02 and nearly doubled to 72% in 2004. Home theater audio hardware penetration nearly doubled between 2001 and 2004, further encouraging home video viewing. Demographic and economic factors positive for market As DVD technology tends to be the domain of younger consumers, the fact that those aged 15-34 are projected to increase by nearly 7% between 2000 and 2010 has been and will continue to be a boon for the market. That ethnic youth are also forecast to increase in number is likewise positive, with...
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...industry includes such companies that rent DVDs, Blu-ray discs and even video games which are usable on home-based electronic equipment (Espedido Julian, 2010). Many companies are participants in this lucrative business and they include such companies as Wal-Mart, Netflix, Blockbuster, Intelliflix, Redbox and GameZnFlix among others. Both Netflix and Blockbuster companies are presently the leaders in the rental movie industry and therefore the major rivals in the rental movie industry. As to Blockbuster, it has a quite lengthy convention in the business. The Blockbuster has existed since the year 1985, even as Netflix entered its 12th anniversary this year. This gives Blockbuster an edge of existence over its close competitor Netflix. This paper intends to critically provide an in depth analysis for Arthur Thompson's case study entitled "Competition in the Movie Rental Industry in 2008: Netflix and Blockbuster Battle for Market Leadership." It will comb thoroughly issues like the trends which affect either negatively or positively the movie rental industry with utmost reference to Netflix and Blockbuster in respect to their fight for the market headship, scrutinize in detail the competitive movie rental industry environment, and by extension give detailed discussion on the use of both the SWOT as well as reasonable scorecard to evaluate Netflix's battle strategy for market leadership on the whole. The video rental industry (formally known as home entertainment or leisure) is actually...
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...Blockbuster Video Customer Survey Kurt Dessert, Shevonne Kilpatrick, Erik Kraft, Stephanie Upchurch QNT/561 November 11, 2013 Hui Zhang/Thomas Allen Blockbuster Video Customer Survey Background and Description of Problem For many years, Blockbuster led the pack in the home movie, video, and game rental services. The company had a sound and simple business model that enabled customers to watch top-billing movies in the comforts of their living room for a fraction of what it would cost to attend the movies. In addition to providing customers with low cost video service and comfort, Blockbuster housed more than 5,000 retail stores conveniently located in every community. It was a solid business model until technology and a new competition displaced it. Team A will address the causes that led to the fall of Blockbuster such as declining profits, low adaptability, and low accessibility. Furthermore, Team A will develop a survey questionnaire to address the company’s problems and determine possible solutions for Blockbuster LLC. Blockbuster LLC, formerly Blockbuster Inc., is an American-based provider of home movie and video game rental services. Blockbuster distributes its products to customers in four ways: in-store rentals/sales, DVD-by-mail, vending machines, and online streaming (Wikinvest, 2013). The company’s in-store selection offers both new/used movies, and game rentals to include Blu-ray DVDs. Their mail service offers their customers an Internet-based subscription...
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...Blockbuster Meaning A thing of great power or size, in particular a film, book, or other product that is a great commercial success About Blockbuster: Blockbuster Inc. is a leading global provider of in-home movies and games entertainment. Introduction: provides Blockbuster Video stores and Online rental services. worldwide brand operating in more than 20 countries majority in USA Its stores are ubiquitous more than 8,000 stores Slogan: "The Movie Store at Your Door" PRODUCTS: Retailing and renting of DVD Blu-ray Video games. SIGNIFICANCE: Easily available Unlimited selection Wide variety of movies from different genre Small stores cannot compete Changes: 2004: launched online rental service Gain market share No late fees Video rental stores Important change was hiring a new CEO, James W. Keyes. CEO: James W. Keyes(since july 2007) former CEO of 7-Eleven(2000-2005) Vise president and chief operating officer of 7-Eleven DOWN FALL: unable to determine profitable goods missed sales opportunities financial difficulties Lost customer to Netflix REVIVAL: Quantitative approach JAMES W. KEYESQUANTITATIVE APPROACH: 1) computer models to figure out the best way by saving both money and time. 2) Inventory model 3) Queuing theory 4) Capital budgeting 5) Production scheduling 6) Planning for manpower development programs. 7) Transportation and aircraft scheduling 8) Preventive control and replacement problems ...
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...particular market model. The industry I chose to research is the movie rental industry. An industry, which at one time was dominated by Blockbuster Video, has gone through enormous change over the past five to ten years. Blockbuster Video had very little competition when brick and mortar stores were the only way to rent movies. Hollywood Video was their only national competitor; however, they did compete with many regional and local movie rental companies. New technology, along with multiple competitors, have changed the way consumers purchase movie rentals and other video. Once considered a monopoly by many, Blockbuster Video fought the many pressures affecting brick and mortar stores today. The company had stores on every corner, which resulted in high costs. Once the industry started evolving with new technologies, these stores became sunk costs for the retailer. Online-only retailers who enjoyed much lower costs than the brick and mortar stores were able to profitably charge customers a lower rate; however, at the same time, Blockbuster Video was saddled with the high costs of labor as well as the physical stores. It was not long before Blockbuster’s costs became too much for the retailer, as they were forced into bankruptcy. Today’s market landscape looks much differently than it did when Blockbuster Video was at its peak. Many more competitors fight for the consumer’s dollar; however, there are still a few dominant companies that stand out among...
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...Assess and critically comment on the idea that strategic planning systems can stifle innovative thinking in organisations It is debatable whether strategic planning systems can stifle innovative thinking in organisations. Although strategic planning systems are used in order to make companies work more efficiently, they may restrict organisations from showing their true potential by stifling innovative thinking. There are other theorists that state that listening to closely to markets and strategies can create a barrier to commercialising new technology and lead to reduced competitiveness. (Ferrell and Lukas 2000). In order to truly understand and analyse whether innovative thinking is being constrained by strategic planning systems, it is essential to understand which strategic planning systems are being used, whether their implementation limits the allowance to new and different approaches to organisations, and whether companies in real-life are being affected by this constraint. Before analysing whether innovative thinking is oppressed by strategic planning systems, it is important to define what a strategic planning system is. According to the BNET Business Dictionary (2007), strategic analysis is ‘…the process of conducting research on the business environment within which an organisation operates and on the organisation itself, in order to formulate strategy’. There are many different tools and analytical methods that are used by companies but there are three main...
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...Fall 2011 | BlockBuster Case Analysis | | 1. What role has Netflix played in the development of Blockbuster’s strategic planning? How important is Netflix to Blockbuster’s future strategic plans? Before answering this question ,I would like to highlight that It s clear after reading the case that blockbuster main problem was making strategic plan without considering its scorecard as they never anticipated change or tried to early explore strategic alternatives and they never examined consumer or competitive responses. In a nutshell they were always reactive and not proactive and they never considered that new entrants always seek market space that leaders ignore. To answer this question, I will try to answer the three major strategic marketing questions “Where to compete?”, “How to compete?” and “When to compete?” and apply my answers to Analyze Blockbuster case Where to Compete: * Blockbuster’s targeted the whole market of home movie viewers in the US. Afterwards, they started to target international markets. Blockbuster service their customers through rental stores and they kept using the same business model. However, they failed to understand the change in consumer behavior as people became more busy and don’t have time to visit their stores. * Netflix targeted same market but with different approach as they offered mailing system of movie rentals that go directly to customers and that was very convenient solution and they started capturing...
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...Zubrod, Abel Dominguez, Eric Paniagua, Su Rodriguez LDR/531 January 11, 2015 Professor David Warren Introduction The mission statement for Redbox and Blockbuster both have focused on providing customer satisfaction with media entertainment that includes movies and games. In the years prior to the inception of Redbox in 2002, Blockbuster offered customers a value price entertainment experience, combining the broad product depth of a specialty retailer with local neighborhood convenience (Poggi, 2010). Blockbuster Inc. was a global business with 8,000 stores and offered movie and game rentals for home use by consumers (Poggi, 2010). Since 1992, Outerwall LLC had looking for ways to provide value, convenience and simplicity to consumers and retailers with the kiosk brands best known, Coinstar a leader in money services and Redbox, the best value in home entertainment. Outerwall LLC has a network of more than 66,000 kiosks and will be re-imagining new retail solutions to fit everyday consumer needs for the present and the future (Outerwall.com, 2015). Blockbuster – Success and Failure Blockbuster’s vision Statement: "At Blockbuster, diversity means valuing differences. It's a corporate value that must be continually developed, embraced and incorporated into the way we do business" (Poggi, 2010). Blockbuster was a video rental store that started in Dallas, Texas the first store was opened in October, 1985 and the theme for the company was to be a family-friendly business...
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...Business Failure Enron xxxxxxxxxx University of Phoenix Online February xx, xxxx xxxxxxxxxxxx Examining a Business Failure: Enron This paper will discuss the contributions of leadership, management, and organizational structures that led to the demise of Enron. The structures will also be compared and contrasted to help better understand why the company failed. Enron Corporation was founded in Omaha Nebraska 1985 and was defunct on December 2, 2001. In the year 2000 Enron had published revenues of $101 billion and employed approximately 22,000 employees. The Company’s founder and CEO was Kenneth Lay Other notable people who lead Enron where Jeffery Skilling, Andres Fastow, Rebecca Mark-Jusbasche. Fortune magazine nominated Enron as “Americas Most Innovative Company” for six consecutive years. At the end of 2001 it was discovered that Enron had been creatively distributing its debt through fraudulent planned Accounting making the company seem very profitable in previous years ("Enron", 2012). Leadership, Management, and Organizational Structures (contributed to the failure) Leadership has many different definitions; one definition is “the behavior of an individual directing the activities of a group toward a shared goal. (Hemphill & Coons, 1957, pg 7). This definition is closely is related and applies to Enron’s leadership, Management and structure. Enron’s leadership...
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