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Analyst: Blockbuster Reaffirms Small Retail Footprint Strategy

17 Jun, 2009 By: Erik Gruenwedel


Blockbuster Inc. is aggressively eyeing rental kiosks and smaller storefronts to maintain brand awareness as recession-weary consumers look for digital convenience and lower prices, said an analyst.

Luke Shagets, research associate with Sterne Agee in Dallas, said the No. 1 DVD rental chain reiterated it would have 3,000 branded rental kiosks launched through NCR in operation by the end of the year, including 10 currently offering movie downloads on flash memory sticks.

Blockbuster Express kiosks hold 1,000 new release movies and games  — about double the number of most other kiosks — for both rental and sale. They can be retrofitted for download capability going forward.

Blockbuster has said it would seek to renegotiate about $400 million in annual store leases to reduce storefronts sizes to less than 2,000 square feet in select areas.

“Blockbuster wants to provide access to its media in a more convenient way to consumers,” Shagets said.

Blockbuster CEO Jim Keyes presented the business strategies June 16 at Stern Agee’s first West coast consumer conference in San Francisco.

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