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Red Box Brand Audit


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  •   Price & Convenience: $1 – per – day rental. Rent at one location, return at another. Non-Committal Service Red Kiosk Each with 630 DVDs representing 200 titles Order online at Use iPhone app to find nearest location Proven Technology Unmatched production timeline No big deal if you change your plans or don’t like the movie it’s just a $1. (99 cent menu value)
  • Customer Acquisition. Please customers. Growing Distribution. Powerful marketing partnerships. Low overhead. Direct Connection via mobile & e-mail: 1.7m text message customers growing by 100,000/month 20m customer email addresses
  • Blu-ray will lead sales 2011 and beyond. No overseas expansion, focus remains in the US
  • Video rental kiosks on track to make up nearly 30 percent of the U.S. video rental market in 2010 Through the first half of 2009, the share of rental turns (i.e., the number of videos rented by consumers) reached 19 percent for video kiosks like Redbox, compared to 36 percent for Netflix and other subscription services, and 45 percent for Blockbuster and other traditional brick–and-mortar video stores.
  • Amazon Instant Video On Demand Blockbuster Blockbuster Express (kiosk) Blockbuster Online Comcast On Demand Netflix Xbox - extension of Netflix The New Release (aka MovieCube) DVDXpress DVDplay Gamefly
  • 26,000 kiosks nationwide McDonald’s, Walmart, Walgren’s, select 7-eleven’s, leading grocery stores.
  • Redbox Young, innovative, fun, affordable Blockbuster Dynasty A leading brand caught off guard Did not optimize brand for business extensions Netflix Well known brand becoming stale Comcast On Demand Brand extension void of its own personality
  • Demographics Gender evenly split (49%/51%) Ages 18-34 & 35-49 account for 70% of customers 76% are Caucasian Half have children at home (55%) Even income distribution (30-60k, 60-100k, 100k+) Half have graduated college [Based on demographics of Redbox customers also online]
  • Busy, on the go, movie entertainment seeker. Like to be up to date on the latest, greatest. Perceive convenience broadly? Online savvy. Open to new media (Facebook, Twitter, blogging). Deal seeker propensity & appreciate a good deal. More apt to try new things. May be more difficult to maintain as customers. No commitment with Redbox, open to trying new things, and seek deals.
  • Transcript

    • 1. Shelby Gagnon Jennifer Walker Bryan Zembruski
    • 2. Agenda Brand Elements & Growth Consumers & Competition Equity & Position What’s in the Future
    • 3.
      • Price & Convenience.
      • Non-Committal Service.
      • Red Kiosk: 630 DVDs/200 Titles.
      • Order Online.
      • iPhone App Locations.
      • Promo Codes.
      Brand Elements & Attributes
    • 4.
      Brand Elements & Attributes
      • Customer Acquisition.
        • Please customers.
      • Growing Distribution.
        • Powerful marketing
        • partnerships.
        • Low overhead.
      • Direct Connection via mobile & e-mail:
        • 1.7M Text Message.
        • 20M Email Addresses.
        • Customer Growth 100,000/month.
    • 5. Big red kiosk, Identifiable Fun, Exciting, Innovative, Happy, Entertaining DVD & Blue-ray Top new releases Kids videos Always in stock Free Rental Codes Facebook Freebies Text Codes Groupon deal
      • Easy to use
      • No employees
      Convenient Many locations 7-Eleven, grocery store Rent & return anywhere Rent with errands $1 Great Value No late fees Credit card Email Receipt/Confirmation Big red kiosk Identifiable Brightly lit up Video Games for multiple consoles Easy to use Self-service Quick service
    • 6.
      Brand Growth
      • Timeline:
      • 2002 McDonald’s Ventures, LLC 12 kiosks launch to lure in customers
      • 2004 1 st market test Denver, CO 140 kiosks
      • 2005 Coinstar Inc invests with 47% ownership
      • 2008 200% Revenue Increase
      • 2009 Expanded into Game Rentals to compete with Gamefly
      • 2010 HD Blu-Ray Offering
      • Video Game test markets: NV, TX, WI, OR, NC
      • Online rental option
      • 2011 Facebook fans growth 30,000 in 2010 to over 1.8million
        • iPhone app launched 2.5m downloads
      • 2014 DVD rentals expanding at average rate 2.7% to $9.97billion.
    • 7. DVD Rental Market
    • 8. Kiosks Rising Share Video rental kiosks on track to make up nearly 30 percent of the U.S. video rental market in 2010
    • 9. Major Competitors
    • 10. Points of Purchase
    • 11. Points of Parity
      • Free trial
      • Convenience
      • Order Online
      • Smartphone apps
      • Move toward video games/streaming
    • 12. Points of Difference
      • Young, Innovative, Fun
      • $1 Price Point
      • Well-known Kiosk
      • Ease of Use
      • No Commitment
      • No Account Setup Required
      • No Human Interaction
      • Rent & Return Anywhere
      • High Availability of New Releases
      • Promotions & Freebies
      • Dominant Social Media Presence
      • No Streaming (coming soon)
      • Limited Titles
    • 13.
      • Redbox.
        • Young, innovative, fun, affordable.
      • Blockbuster Dynasty.
        • A leading brand caught off guard.
        • Failed to optimize brand.
      • Netflix.
        • Well known brand becoming stale.
      • Comcast On Demand.
        • Brand extension void of its own personality.
      Competitor Analysis
    • 14.
      • Demographics:
        • 49/51% Gender Evenly Split.
        • Ages 18 - 34 and 35 - 49.
        • 76% Caucasian.
        • 55% Children at Home.
        • Even income distribution
          • (30-60k, 60-100k, 100k+).
        • Half college graduates.
      Consumer Base
        • [Based on demographics of Redbox customers also online.]
    • 15.
        • On-the-go entertainment seeker.
        • Follow Movie Trends.
        • Online savvy.
        • Open to new media.
        • Deal seeker.
        • Early Adapter.
        • Moderately brand loyal.
      Consumer Base
    • 16. Partnerships & Cross Promotion
    • 17. Promo Deals
    • 18. Is The Brand Well Positioned?
      • Redbox has successfully Positioned itself as:
      • First to market with rental kiosks
        • Entered market by way of Blue Ocean Strategy
      • Regular Promotions
        • Movie Mondays
        • First rental is free
        • Facebook promotion codes
        • Redbox Blog membership rental codes
    • 19. Is The Brand Well Positioned?
      • Redbox has successfully Positioned itself as:
      • A low cost provider of movie/video game rentals
        • Inexpensive entertainment for the unemployed
      • A conveniently located movie/video game rental service
        • Located at regularly frequented stores
      • An impulse rental service
        • Immediate gratification
        • "there’s nothing to do tonight, let’s rent a movie...”
    • 20. Position Map (Jennifer)
    • 21. Sources of Brand Equity
      • Brand Loyalty
        • Relatively fickle customer base
        • High level of repeat purchasers
      • Brand Awareness
        • 84% brand awareness
        • Large Red Point-of-Purchase Kiosks
      • Perceived Quality
        • Low price
        • Great Customer Service
    • 22. Sources of Brand Equity Continued
      • Brand Associations
        • Inexpensive
        • Convenient locations
        • Fast Rental
        • Easy to use Kiosk interface
        • Free Movie Promotions
      • Other proprietary Brand Assets
        • Increased awareness and perceived quality via partnerships with brands such as:
          • Pepsi
          • Orrville Redenbacher
          • Frito Lay
          • Mc Donnalds
          • Monopoly
    • 23. Customer-Based Brand Equity Pyramid
      • Resonance:
        • Weakest on top because of consumers’ low personal attachment to the brand and fickle brand loyalty
      • Feelings/Imagery:
        • The Redbox customer-based brand equity pyramid is strongest on the right side due to the positive feelings associated with the products offered and attention catching imagery of the kiosks
      • Judgement/Performance:
        • Medium strength on the left side because of quality of product, while good, is on par with most other rental companies
      • Salience:
        • Extremely strong on bottom of the pyramid on account of consumers’ high level of product recall for the Redbox brand
    • 24. Customer Based Brand Equity Pyramid
    • 25. Philanthropy and CSR
      • Jacksonville FL (Feel good Movies)
        • Allows customers to donate their initial $1 rental fee to one of 10 charities in Northeast Florida and Southeast Georgia
      • Coinstar (Parent Company) Donations:
        • American Red Cross
        • Feeding America
        • Leukemia & Lymphoma
        • The March of Dimes
        • UNICEF
        • World Wildlife Fund
    • 26. Brand Errors
      •   Initial convenience store vending machines.
      • Slogan Failures
      • “ Never a late fee ever”
    • 27. Recommendations
    • 28. Suggestions: Building & Maintaining Equity (all)
      • Maintain the perceived quality of the brand.
      • Keep $1 price point.
      • Increase philanthropic activities for the Redbox Brand.
      • Connect with new consumers through continued partnerships and promotional codes.
    • 29. Goals
      • Short-term: Identify slogan. What’s in your Box?; Look/Delve inside the box? What’s playing on your TV tonight? (Simplify)
      • Gain 8.7% within the last year; match mkt share this year.
      • Increase awareness goals. New partnerships like Papa Murphy’s, Little Cesar’s, Pizza Hut/Dominos; Target gamers online – “Try it Before You Buy It” link to where gamers go ie World of War Craft. Target Stores.
      • Long-term: in order to acquire new customers launch an advertising and marketing campaign ONLINE with the launch
      • of streaming online videos.
      • Philantrophic
      • Future: Global expansion. Extend ad marketing campaign after test markets, focus groups, etc consider to move beyond WOM. Consider research cost ROI TV show offerings online and or at kiosks.
    • 30. Proposal: Brand Extension (all)
      • RedPhone
      • Prepaid cell phone kiosks
      • RedAir
      • My Sky Redbox
      • I Fly Redbox
    • 31.