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Ask Slashdot: How To Make a DVD-Rental Store More Relevant?
smi.james.th writes "Here on Slashdot, the concept that older models of business need to be updated to keep with the times is often mentioned. A friend of mine owns a DVD rental store, and he often listens to potential customers walk out, saying that they'd rather download the movie, and not because his prices are unreasonable. With the local telco on a project to boost internet speeds, my friend feels as though the end is near for his livelihood. So, Slashdotters, I put it to you: What can a DVD store owner do to make his store more relevant? What services would you pay for at a DVD store?"
My friend manufacturers and sells horse whips. With this trend towards horseless carriages he doesn't seem to sell as many as he used to. Does anybody have any ideas on how he can increase his business?
Time to find a new business. He's a buggy whip salesman in the era of automobiles.
The only possible way to survive is to develop a niche. Streaming services are usually pretty good for recent movies, but a lot of back catalogue stuff is hard to find. Specialize in the stuff that's out of print, rare, etc. But really, I'm hard-pressed to see how that business model would be sustainable as a primary income source in most communities. There simply isn't enough demand for the content, especially given the huge amount of material available through Netflix's mail catalogue.
All the video rental shops are closed, taking the video game rentals with them. I miss being able to rent a game instead of outright buying it. May not be a big enough market though.
Buying and reselling used games that don't cost as much as their brand new counterparts is something that people are sorely in need of. Maybe credits for game rentals with a trade-in instead of cash?
Even if you don't charge much less, charging $20-25 for a used game opposed to the $40-50 EB and Gamestop charge might drive some business away from them and towards your friend.
Compute how much these new internet business models actually cost you in the long term. Send them a bill for potential losses.
MPAA and RIAA do it all the time!
If Pandora's box is destined to be opened, *I* want to be the one to open it.
Well, people who come to a DVD shop presumably want to rent DVDs...which means that perhaps they're not comfortable with the latest tech, even if - as you quote - many say they would rather download the film. My experience with DVD shops has been that they are pretty miserable places, which make most of their profit from overdue fees.
Make a comfy place with 'cult' DVDs to hire, plus give advice on ways to upgrade your home cinema. Sell overpriced coffee.
Come up with creative-funny gift ideas (Christopher Walkin Box set, Chuck Norris Box set),Sell retro computer games(similar shelving), Lend the book that goes with the movie, gather other good info with the movie, Have amazing memorabilia that will attract people into the store (celebrity death masks aren't always expensive), Like an art space, do other things to attract people there: small indie-video screenings, movie discussions, director talks. Put on a local TV show discussing movies coming out on DVD.
If your friend is running a successful business, then he's got a particularly useful and uncommon skill.
Some 80% of all first businesses fail, but only 20% of second businesses fail. That's because after the first business, you learn from your mistakes. Your friend has the skills and experience needed to start a new business - and that's what he should do.
So, what's trending on the map right now? What brick-and-mortar establishments are on the rise?
How about setting up a hackerspace? These seem to be popping up everywhere, and unlike McDonalds, there's still room for more.
While running the 'space, keep an eye out for things that might be products. With a hackerspace available it's easy to "test the waters" for a new tech product: you have access to people with skills for design, construction, [website] sales, and so on.
What they don't have is someone who can steer the ship, someone who has experience in things like incorporating, taxes, management, planning, accounting, and so on.
Consider starting a hackerspace. I hear that they can be successful and lots of fun.
I actually might be qualified to answer this since my business partner and I are in this very scenario and we have already made adjustments that have had a real positive impact.
My partner's dvd rental store has been in business and at the same location for over 16 years. During that time, Blockbuster gave it a run for TEN years directly across the street, but closed down 2 years ago. He began supplementing the business by becoming a wireless dealer and bill payment station. Here in Houston, multipurpose shops are EVERYWHERE and are VITAL in small, mostly Hispanic communities, so in order to compete, your store must offer all or at least some of the following: Phone service, phone cards (for international calling), bill payment such as local utilities and cable, Western Union, MoneyGram, money orders, copies, fax service, etc...
We recently began offering computer repairs and upgrades in addition to the cell phone repairs and he has quite a bit of retail space dedicated to not only popcorn, candy and soda, but even chips, sweets, fortune cookies, designer fragrances, and tons of accessories.
This may seem crazy to a lot of readers here, and it's certainly a lot to juggle for a store owner, but the truth is, he has been a staple in the community for so long that our customers keep finding reasons to come in. Sure, they still rent dvds, but they really come for the multitude oi other helpful services we offer.
Slashdot isn't the best place to ask because most of us have bought into digital distribution. We are unlikely to be the video store's target audience so we aren't the best people to ask.
Your friend also has some challenges because copyright laws limit his options. A lot of things that could be done would be illegal or require a lot of paperwork because it would be considered a public showing (e.g. previews, a showing room for private events).
Yet they may be able to transition their business if they are into film. This could be tied to tangible products or people oriented. They could try to sell the hardware to show movies, provide a forum to discuss them, or even provide a hub for people who want to produce independent films.
There are a lot of other ways to adapt. The key though is to talk to the people who matter: the customers who would actually use the service.
- wide selection of movies and TV shows, stuff you won't find elsewhere or downloadable via torrents, like lesser known foreign and independent movies, the place is huge.
- enough copies of popular movies so you can almost always get what you went there for
- blu-ray, DVD, VHS (!), Xbox 360, Wii, etc., whatever you and your family needs, it's there
- two for one days on slower nights of the week and other coupons for the past decade brings plenty of people into the outlet
- extras are sold off at a good price when they're no longer rented
As bandwidth improves
It's not just burst bandwidth that has to improve but also sustained bandwidth. Several types of home Internet access, such as satellite and cellular, have acceptable burst bandwidth (in the high hundreds of Kbps to low Mbps) but unacceptable sustained bandwidth (typically less than 10 GB per month). That's not going to change until A. it becomes drastically cheaper to get rural areas wired for fiber, or B. the state subsidizes getting rural areas wired for fiber.
I recently spent a couple of days in Raton, NM. It's quite small but they have a thing there called the Whittington Center. It's a gigantic place to shoot, museum, store, and library on all things having to do with shooting. (How it got there is a fascinating political story that I'll leave for another day.) I'm retired and I love to shoot but it was that library that drew me in. I spent hours and hours there, finding new gems and old, every time I scanned a different shelf. I would literally consider moving to Raton just to have easy access to that specialty library...if it weren't for the fact that I spent enough time there to discover that Raton is an armpit of a place.
In the large metro area where I currently live there are a couple of niche stores that are doing at least OK. I can think of two stores that sell just vinyl records. I can think of one that rents rare DVDs, has an extensive anime section, even has some old stock on tape that never made it to disc, and sells a small selection of high-value, carefully-selected hardware to equip your home theatre. They have employees who seem to know *everything* and can make a dozen recommendations based on scanty evidence. I've brought three discs to the front counter and said "I've seen these. I liked them. What else would I like?" Within three minutes, an employee will have sprinted me around the store and put a dozen other titles in my hands (guaranteed I haven't even heard of half of them) and I can pick at random from that pile with no fear of disappointment.
I'm definitely willing to pay for that kind of service. It's just too bad I retired and I'm too far away from them to use them now. (In fact, I've been away for so long that I don't know if 2 of the 3 examples I just gave are still in business and I don't want the potential heartbreak of looking them up online to see if they still are.)
That brings me to my last point - location. Most DVD stores that were successful back in the day did so by being where there were the most people. Everybody was renting DVDs so you just had to be located where the most people were to be found. There were even DVD stores that did rentals inside major shopping malls.
Times have changed. Joe Average is no longer your customer. If the store in question is in a place with good traffic flow but no *specialty* traffic flow, then they're screwed, doubly so since not only is the customer base falling but the location rents are probably higher *because* of the good traffic flow.
The first idea that pops into my head is that specialty equipment stores that sell guns, weightlifting equipment, cosmetics, whatever, etc., tend to have a shelf somewhere with a couple of "how-to" discs to buy. The selection is always lousy and the discs are for purchase only. I wish someone would come up with a way to put a smaller, lower-tech version of a Red Box in every speciality store in the country. Said kiosk (or just a shelf of DVDs with bar-coded labels that somehow communicate with whatever vertical app the store is using to sell all their other stuff) would rent out "how-to" and specialty DVDs to those people who are interested in the goods sold by that particular store.
Wherever there's a successful brick-and-mortar store, there's the potential to sell and rent DVDs with highly-specialized content to the customers of those stores.
Why not abandon the "DVD store" concept? Bring the stock to the customers instead of making the customers come to the stock. I know one gun store that tried this with books and it failed but only because it took up too much room. On a per-square-foot basis, keeping a book store inside a gun store is stupid; there's so much more profit in just adding more display space for high-dollar-markup guns. With DVDs, though, we're literally talking less than two square feet of floor space for a tall, rotating rack.
Just an idea. I hate to see the OP's friend go out of business without at least an idea or two on the table.
I would add "reasonable subscription." Our local DVD rental store had a reasonable rate and we were allowed three DVDs out at one time. The movies of course were "two tier" -- older movies and new releases. Our subscription didn't include new releases. When they tripled the cost of the subscription, we cancelled it (and within two months the store was closed).
"a customer list, knowledge of movies and location" sounds like a perfect mixture of what you need.
A lot of suggestions on here are emphasizing the physical connection and shared experience, but I'd shy away from the "become the NPR book club experience for indie movies" direction. People still go to movie theatres after all, and not just the art-house ones. Keep your focus on the mainstream local customer market.
My thoughts?
1) Make it very easy to browse. Apple spent a b unch of money working on "Album Cover" browse mode, and Netflix tries to micro-genre target for you .. try to come up with a happy medium in physicality.
2) Emphasize the human connection -- events, specials, etc. I don't know what the location is like, but if there's a restaurant next door, come up with a dinner-and-a-movie cross promotion with them.
3) A web-browsable catalog is nice, but you know what's faster than tapping in a name on your PS3 Netflix controller? Calling a number (assuming you're staffing your phones). Make it super easy to reach a live person, preferably one who might know you by name when you walk in. Hire movie nerds just like Gamestop hires game nerds.
4) Use location cell services (Foursquare, Google Local or whatever they call it) heavily... Specials, deals, mayorships, etc...
5) As someone else said... if you can't beat em, join em. Get high speed internet and wireless (protected, with daily changing keys that are on the receipt or something) and set up some areas for people to deal with streaming services. Maybe get a Red Box and stick it *inside* your store -- I have no idea on pricing, but see if you can set the price for it somewhere above the default.
6) Upsell with food/drinks just like Blockbuster did.
7) Don't try to undercut yourself out of business by lowering price, but offer meaningful loyalty rewards. It's more important to *keep customers coming back* than to make high profits off each one.
Good luck!
Hire a Linux system administrator, systems engineer,
Use rfid or other tech so that when someone is leaving with movies, they are automatically logged and displayed. This is what you will be billed for starting now.
Bill by the day.
Make it easy to purchase the movies as an alternative to returning them. Take advantage of lazy purchasing.
Keep a computer terminal up and locked on IMDB so people can look up the movie or find a movie they remember.
Have three return bins. Liked it, hated it. Defective. Let your customers vote on which movies to keep in stock.
Make it easy to order movies for purchase an put on their account. Take advantage of impulse purchasing.
Dont ever ever ever ask them to sign up for an additional type of membership. Always a downer.
Make it so that they never leave without a movie. Have a "are you feeling lucky" freebie movie.
stress the importance and worth of the special features (which are unavailabe on streaming)
Dont waste shelf space with all your titles flat. Keep one face up, the rest on edge.
Dont be prudes
Stock movies you would watch. Dont stock movies you could never stand to watch. Be a good place to find good movies.