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Can Blockbuster Evolve With the Industry?

21 Apr, 2006 By: Jessica Wolf

For those of us on this side of the industry — that is, watching the evolutionary events closely in a rather insular situation — it's sometimes very interesting to witness the video market from the end-user's perspective.

I was visiting some friends recently who are traditional video consumers. They rent a lot, they own some, and they download never — not even music. The father of the house polled the family on what to pick up at Blockbuster and asked me for suggestions.

Not surprisingly, the three young boys of the household wanted The Chronicles of Narnia. An hour or so later, their dad returned and pulled Narnia out of a plastic Blockbuster bag.

“They were all out, so I just bought it,” he said.

When Blockbuster launched its partial debacle of the “No Late Fees” program, they probably had shoppers like my friend in mind. A Blockbuster spokesperson once told me “No Late Fees” effectively ended the chain's much-vaunted “Guaranteed Rentals” program.

You have to think that, in part, the thought was to convert some of those traditional renters to buyers simply by virtue of the scenario I just described. We all know Blockbuster's “No Late Fees” plan also had a sellthrough conversion tucked neatly in the fine print.

My friends are still loyal Blockbuster customers, but I wonder how long they will be.

With the potential evolution of the industry toward downloading as the rental transaction of choice, I wonder if a big corporate entity like Blockbuster can compete. The chain's VOD competitors are already warning, “evolve or die.”

My friend looked to me, as a video insider, to help him make a purchase decision. If Blockbuster goes the way of the dinosaur, perhaps a new kind of independent can evolve to fill in the blanks, to offer critique, dialogue, opinion and suggestions for consumers like this.

I guarantee this renting family will be hitting the Blockbuster more often than the Internet, at least until their oldest becomes a downloading teenager.

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