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Blockbuster

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Blockbuster

  1. 1. Last Minute Consulting
  2. 2. <ul><li>Key Success Factors </li></ul><ul><li>Adaptive to consumer preferences </li></ul><ul><ul><li>Watching movies online </li></ul></ul><ul><ul><li>Changing logistics </li></ul></ul><ul><li>Contract Negotiation </li></ul><ul><ul><li>Supplier Power  Purchasing Agreements </li></ul></ul><ul><ul><li>Revenue Sharing  Lower fixed costs, increase available selection </li></ul></ul><ul><li>Changing of delivering media </li></ul><ul><ul><li>DVDs </li></ul></ul><ul><ul><li>VOD </li></ul></ul><ul><ul><li>Internet </li></ul></ul>Last Minute Consulting
  3. 3. <ul><li>Drivers of Change </li></ul><ul><li>Disposable Income </li></ul><ul><ul><li>Income decreases, consumers are less likely to purchase entertainment </li></ul></ul><ul><li>Innovation </li></ul><ul><li>Buyer Power </li></ul>Last Minute Consulting
  4. 4. <ul><li>Overall Attractiveness </li></ul><ul><li>Moderately attractive </li></ul><ul><li>Highly saturated environment </li></ul><ul><li>Competitors are fierce </li></ul><ul><ul><li>Netflix </li></ul></ul><ul><ul><li>Redbox </li></ul></ul><ul><li>Industry revenues are expected to Decrease 4.7% - Encyclopedia of Business </li></ul>Last Minute Consulting
  5. 5. Last Minute Consulting
  6. 6. <ul><li>Current Product Market Focus </li></ul><ul><li>Operating 5000+ stores worldwide </li></ul><ul><li>Medium Product, Low Focus </li></ul><ul><ul><li>Rent/buy games , movies </li></ul></ul><ul><ul><li>Buy, snacks and merchandise </li></ul></ul><ul><li>Target Market  Everyone </li></ul>Last Minute Consulting
  7. 7. <ul><li>Financial Performance </li></ul><ul><li>Filed bankruptcy September 2010 </li></ul><ul><li>Estimated 150 layoffs </li></ul><ul><li>Operating performance is Negative </li></ul><ul><ul><li>Blockbuster’s debt to asset ratio is 1.2% </li></ul></ul><ul><ul><li>Industry average debt to asset ratio is .44% </li></ul></ul><ul><li>Organizational Health </li></ul><ul><li>Store employees feel threatened  Individual case </li></ul>Last Minute Consulting
  8. 8. <ul><li>Strengths </li></ul><ul><li>Multichannel distribution </li></ul><ul><ul><li>Kiosks </li></ul></ul><ul><ul><li>Mail </li></ul></ul><ul><ul><li>In store </li></ul></ul><ul><ul><li>Internet </li></ul></ul><ul><li>Rent/buy videos and games </li></ul><ul><li>Weaknesses </li></ul><ul><li>Confuse customers </li></ul><ul><li>Past late fees </li></ul><ul><li>Slow decision making process </li></ul>Last Minute Consulting
  9. 9. <ul><li>High product – Low focus </li></ul><ul><li>High differentiation – Low cost emphasis </li></ul><ul><li>Benefits </li></ul><ul><ul><li>No lines </li></ul></ul><ul><ul><li>No packed theatres </li></ul></ul><ul><ul><li>New release 8 weeks after in theatre compared to 4 months </li></ul></ul><ul><li>Major Changes </li></ul><ul><ul><li>Contracts with studios </li></ul></ul><ul><ul><li>Advertising new strategy </li></ul></ul>Last Minute Consulting
  10. 10. <ul><li>Financial Viability </li></ul><ul><li>Increase revenues $94,401,000 annually </li></ul><ul><li>Increase costs $72,000,000 annually </li></ul><ul><li>Increase profits $22,400,998 annually </li></ul>Last Minute Consulting
  11. 11. Last Minute Consulting
  12. 12. <ul><li>Implementation Plan </li></ul><ul><li>Completed by October 2011 </li></ul>Last Minute Consulting

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