Blockbuster Express kiosks are a last-ditch effort to save Blockbuster. These Blockbuster Express kiosks came from Red Box finding so much success in the market, so again Blockbuster is going to react too late to the changing environment. First Netflix destroyed Blockbuster by proving that there were indeed consumers who really wanted to get their movies through the mail, and now Red Box locations have shown that consumers are also willing to get their movies from a machine. In order to try to get a stronger foothold in the kiosk business, Blockbuster Express is actually coming off as desperate.
In a difficult economic climate such as this one, Blockbuster figured that the only way to catch up with what Red Box has already established was to undercut the price point. This Labor Day weekend (through midnight Monday), Blockbuster Express kiosks are offering three movies for just $2. This follows closely on a deal where Blockbuster Express was offering two movies for $1, and it shows that they are willing to sacrifice a bit of revenue up front if it means they can place more kiosks around the country. The question has to be asked if Blockbuster is entering the business too late, though.
For those who haven’t used one of the Red Box kiosk locations or one of the new Blockbuster Express kiosks, it has become a new way for these two businesses to distribute films. These machines are located around convenience stores like 7-11, grocery stores, and even at some restaurants. The intent is to provide consumers with new releases they can rent by a simple swipe of the credit card. The rentals are $1 or $1.15 at Red Box locations per day, with no limit on the number of days. When the customer has finished with the movie, they simply return it to any machine from the same company, and they stop getting charged.
Red Box locations have become a huge success in cities like Spokane, Wash., where the price for a daily rental is at $1.15 now. Blockbuster has finally put one of their Express machines in the city, and they are probably hoping that they can find success in other locations as well. Can Blockbuster catch up to the huge lead that Red Box has in this market? Or will businesses have already come to successful terms with Red Box machines that won’t let Blockbuster into many markets? We have some competition on our hands, and hopefully it means both companies continue to treat their customers right.