Blockbuster Express: Will the Blockbuster Express new kiosk model save their dying business?

What is Blockbuster Express?

Blockbuster Express is using the same business model as Redbox, where they allow customers to rent movies for $1.00 a night. The user can either log into their website and rent a movie and find a location to pick it up, or they can just go directly to the kiosk and rent the movie. I have also read that Blockbuster plans to implement kiosks that alows the customer to download movies to a memory card, which many TVs now have.

The question is, Why? If a consumer knows how to use a memory card with their TV, why wouldn't they just find away to stream it from their computer to their TV. Streaming will be the wave of the future, not memory cards.

After doing further research, I found that the kiosks Blockbuster is now using have been around since 2005, and are owned and operated by NCR. They have been renting movies through these kiosks under the brand "The New Release". Blockbuster is just licensing their name out to make a quick buck. However, "Blockbuster Express" is actually a totally different business than Blockbuster's in-store and mail order video rental business. This will just confuse people.

It may be a good business model to have multiple channels (in-store, mail order, and kiosk). However, if you rent a movie online or pick it up in-store. You can't return it to the kiosk, or if I rent from the kiosk I can't return in-store. This is just weird and dilutes their brand. This is two different companies using the same name just with Express added. We'll see if it works for them.

Also, if you haven't checked out Netflix or Redbox i suggest you try them. I like Netflix in general for just movies and I use Redbox for all the new releases. They both are very affordable and profitable companies.

Blockbuster Express

In 2010, Blockbuster's stock price continues to plummet, from $1.36 on September 15, 2009 to $0.36 cents on April 15, 2010. We have seen Blockbuster's business continue to decline, since Netflix and Redbox entered the video rental industry over the last decade. Blockbuster was once on top and putting their competitors out of business. Today, it's a different story and they're the holding on by a thread, treading the waters of bankruptcy.

Will Blockbuster's new marketing strategy make them a competitor once again or will see a similar fate that they showed their competitors years ago?

Over the past couple months, Blockbuster has decided to expand their presence in the kiosk game with new kiosks popping up branded Blockbuster Express. Redbox has proved to create a profitable business model that had been very successful. This had me scratching my head.

I think that the kiosk business is not a bad idea, however as more individuals buy computers (since the price has dropped drastically over the past two years), I wonder if this kiosk model will survive. This works great for Redbox now, and since Coinstar owns them it makes sense; they can service both machines at the same time. Blockbuster has partnered (Blockbuster is licensing their name) up with NPR to bring these services to the market and mainly to convenience stores. Is this a good strategy, piggybacking off their competitors and trying to make a better product or do they need a game changer? This will be something that will be proved over the next few years.

My Rant about the Blockbuster Express

I just want Blockbuster to go away!

For years I watched them bully their way to the top, and after they were on the top they just walked all over their loyal customers with late fee after late fee. On top of it they would not work with their customers to fix these fees, instead they just let them build up, and when the fees were high enough they would eventually call to collect.

This left a BAD TASTE in my mouth and I will never rent a movie from them again. I joined Netflix years ago (the BEST DECISION EVER) and have never had any problems with them. 

In Conclusion, I think that Blockbuster is a little to late to the game. Netflix has too many loyal customers and I don't see Blockbuster stealing them.

Also, I remember those late fees...don't you?

Source

Blockbuster Express - A Timeline of The Fall of Blockbuster

I found this interesting timeline posted on Fastcompany's website by Austin Carr. I thought it was pretty interesting to see the rise and fall of a giant.

1985: First Blockbuster store opens in Dallas.

1994: Viacom acquires Blockbuster for $8.4 billion.

1997: Reed Hastings returns Apollo 13 to Blockbuster six weeks overdue, and is dismayed by the $40 late fee.

1998: Reed Hastings founds Netflix.

1999: Viacom holds Blockbuster IPO, valued at up to $4.8 billion.

2000: Blockbuster declines several offers to purchase Netflix for a mere $50 million. Instead, the company inks a 20-year deal to deliver on-demand movies with Enron Broadband Services, a subsidiary of energy trading giant Enron.

2001: Enron files for bankruptcy amid accounting scandal.

2002: Blockbuster debuts Super Bowl ad starring the voices of Jim Belushi and James Woods, as a rabbit and a guinea pig. The company posts a $1.6 billion loss.

2003: Netflix posts first profit, earning $6.5 million on revenues of $272 million. Redbox launches a kiosk rental service.

2004: Blockbuster enters online DVD rental market. Netflix CEO Reed Hastings tells analysts in an earnings call, "In the last six months, Blockbuster has thrown everything but the kitchen sink at us." The following day, Hastings receives a package from Blockbuster. Inside: a kitchen sink.

2005: Blockbuster launches a marketing campaign touting its new "No Late Fees" policy. Subsequently, 48 states launch investigations into the program, charging Blockbuster with misrepresenting its late fee policy to customers. Blockbuster settles for $650,000.

2006: Blockbuster, now valued at $500 million, surpasses its goal of two million subscribers for its online platform. Netflix reaches 6.3 million subscribers by December.

2007: Blockbuster hires new CEO Jim Keyes, formerly of 7-Eleven. Keyes decides to roll back the company's Total Access plans. "Clearly our spending on that one channel was exceeding our returns," he said during a company earnings call. After losing a half-million subscribers in the third quarter, Blockbuster announces it will no longer report its subscriber count.

2008: Blockbuster proposes buying struggling electronics chain Circuit City. Blockbuster soon withdraws its offer after it's universally panned. Circuit City files for bankruptcy in November. Keyes also expresses doubt about Netflix in an interview: "I've been frankly confused by this fascination that everybody has with Netflix...Netflix doesn't really have or do anything that we can't or don't already do ourselves."

2009: Blockbuster rolls out Blockbuster Express, its kiosk system designed to compete with Redbox.

March 2010: Blockbuster touts 28-day exclusive window over Netflix for new releases. The company also reintroduces late fees, which had been costing the company $300 million in revenue annually.

May 2010: In an interview with Fast Company, Jim Keyes is asked wheather Blockbuster's financial troubles were due in part to Netflix's success. "No, I don’t know where that comes from," he says. Keyes denies his company is going bankrupt.

June 2010: Keyes compares Blockbuster to Apple, claiming that its On Demand service is the equivalent of the iMac.

July 2010: Blockbuster launchesDroid X app. Blockbuster is de-listed from the New York Stock Exchange after shares hit all time lows.

August 2010: Though ailing from a debt of $900 million, Blockbuster's head of digital strategy explains, "We're strategically better positioned than almost anybody out there. Never in my wildest dreams would I have aimed this high." Blockbuster adds video games to by-mail subscription plans for no additional cost, but neglects to mention that new releases will not be available for three months.

September 2010: Drowned in revenue losses of $1.1 billion, sources say Blockbuster plans to file for bankruptcy. The company is valued at just $24 million.


Will Blockbuster eventually go out of business?

Will Blockbuster eventually go out of business?

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Comments 21 comments

Jacki 6 years ago

I have rented from blockbuster express four times and just discovered they have charged me twice on all four occasions, I called them and was told it's my banks fault....no....their machines ALWAYS asks to run your card a second time.....that's when they charge you a second time....how many of us are they ripping off, un-noticed?

I'll never use Blockbuster Express again!

Going back to Redbox, they never ripped off my bank account.


Amanda 6 years ago

We just got blockbuster express in my town and I only used it because the redbox was broken. I returned my dvds before 9pm and was charged for an extra day so they charged me a late fee before I was even late! I will not rent again I can't afford to be charged like that!


Bob 6 years ago

I tried using them both in store & online but they said my zipcode was wrong. Chase disagrees. They've rolled out machines with software issues. I won't be using them again.


Sandra 6 years ago

Yep it sucks

blockbuster needs to just die


American Woman 6 years ago

On 10 September 2010, I rent a movie at Blockbuster Express Kiosk at Safeway Store address 555 E Calaveras Blvd, Milpitas, California . I returned the movie about 6.55 PM before 9PM dateline . The machine charged me again for another night (late fee) .

I called the Blockbuster 1877-300-2128 and they said sorry about the double charges and gave me a coupon for next time rental and they said they will send a technician to fix the Kiosk problem . On 19 September 2010, I use my coupon for a movie, this time I brought the movie back at 5 PM, the machine charge me $1.09 for late fee . The coupon they gave me is worth nothing . I called the customer service again and tell them the problem, At first, I think something wrong with the software and so I asked them to fix the machines . They told me that they will reverse the charge but they never do it . After I read so many complaints about the Block Buster Kiosks will charge you twice at different locations in U.S , I know they do it on purpose .

The Block Buster Express Kiosks at Safeway store 555 E Calaveras, Milpitas will charge you twice for every movie you rent, no matter how soon you return . So many people have been ripped off by Block Buster Express at the above location . I suggest people should go to Red-Box until Block Buster fix their machines .


Chris 6 years ago

I too just got charged the extra day fee even though I had returned it on time. It was only 8:43 on the clock. At first I just figured the time isn't set right on the machine.. however, all the machines are part of a network and should therefore automatically be synchronized. Hard to tell though as I don't believe it tells you the time on the screen and the stinking things don't give a checkout receipt let alone a return receipt... Heck, even a cheap ATM kiosk will give you one. Disappointed...


Devin 6 years ago

I've enjoed the blockbuster experience and hope they survive. Kiosks and streaming is nice and easy , but the personal effect of a video store will be missed. It's hard to see this happening, but if blockbuster would be cheaper and make better business decisions, they would be great. I just hope if when they are gone, that redbox and netflix get to have all the new releases, no 28 day period.


todd  6 years ago

i just started using blockbuster again n very happy with ther service a box is right around the corner from my house, i have not had any problems with blockbuster. am very satisfied


Scgal 5 years ago

The blockbuster machine I tried today couldn't verify my zip code on 3 of my credit cards so I quit and went back to redbox. They had their one shot with getting a new customer...actually 3 but they screwed up.


Josh 5 years ago

i was charged late fees on multiple occasions when i returned a movie on time, called customer service and they offered me free rentals.....when i used the free rentals (2) i got charged 2 late fees when i returned the movies hours before 9pm (the start time for late fees)

i can see by reading the posts im not the only person that this is happening to, and im sure many go unnoticed. sure...its only a dollar....but take that dollar and multiply it a couple thousand times and they are stealing money. a lot of money. and it is illegal.

there needs to be a class action lawsuit because they are crooks. they know what they are doing.


Help 5 years ago

You have to type in the zip code that you have on your credit card account. If you type in a zip code that doesn't work it means that it is not the one on your card. Perhaps you moved recently or you have a card with your parents address on it. Get a grip and understand how stuff works.


shaun 5 years ago

I used blockbuster express and im very happy with there service.. amazing if they come back.. i will be very excited! I love blockbuster


Jason 5 years ago

I just sign up for Blockbuster Total Access, its great since you don't get any late fees and return the movies by mail. You get 5 in-store exchanges/month for free and you get new releases a month before Netflix. I used to use Netflix but they keep raising the prices and you have to pay more for blu-ray movies. Online stream is ok but most titles arent what you want


Steve 5 years ago

So why if I have a Blockbuster mail account do I have to pay extra to use the kiosk? I have unlimited rentals by mail but have to pay for each kiosk transaction? That is nuts.I would use the kiosk since the three closest Blockbuster stores to me have closed, the closest now beiing more than five miles away.

Steve in Denver


Steve 5 years ago

So why if I have a Blockbuster mail account do I have to pay extra to use the kiosk? I have unlimited rentals by mail but have to pay for each kiosk transaction? That is nuts.I would use the kiosk since the three closest Blockbuster stores to me have closed, the closest now beiing more than five miles away.

Steve in Denver


Phil Dinnis 5 years ago

Blockbuster express are rip off people, I was charged $30 for a movie I returned to the machine the following day. Tried calling them numerous times and was just left waiting for so long i gave up. sent in 5 e mails and no reply. Finally when i managed to speak with them they tell me it's resolved. What that means is I was charged and that's the end of it, when I ask them to really resolve it they say they cannot because they don't have a record of it. Today a week after I returned another movie I have no e mail recepit. 50 minutes after waiting on the phone i'm told yes it was returned and they will send a receipt. I get the feeling if i hadn't followed this up I would have been charged another $30 I think a class action lawsuit will hit these guys soon. My advice don't use them use Redbox, Blockbuster's customer service is a disgrace.


AngryNic 5 years ago

They keep saying my zip code is incorrect but yet they take authorizations out from my account. I've tried 3 times online and at a kiosk with the same error. Customer Service rep told me to call my bank to verify my zip code.....wow....really? I told him, "Let's say I call my bank and they verify what I'm telling you...that my zip code is correct, then what? How will you override your kiosk and website credit card system so that I can rent from you?" He didn't have an answer but he offered me 3 free codes. Welllllll, I can't really use them if they won't accept my credit card information due to "wrong zip code" so those free codes will just rot in my email.

Redbox, I'm sorry for leaving you. I'm coming home, baby!


James 5 years ago

Well, Looks like there is room for Netflix subscribers to switch. And as for Redbox, I have never seen a movie in there that I hadn't already seen if I even cared to see it. You can get such greats as Legally Blonde, and Lethal Weapon II. Blockbuster Express has gotten HUNDREDS of dollars out of my pocket, one Great Movie at a time.


Joe 4 years ago

A couple of people on here are wondering why they cant use their Blockbuster mail account to rent at Blockbuster Express. Well if you read the information above (before the comments) you would know that they are two separate companies. That is why you still have to pay at the machine.


Brit 4 years ago

Blockbuster express has their loews and highs just like every other company. Its sad that these people are losing theirs jobs. Here recently I was overcharged, talked to a wanda, then spoke with a superviser, jessica, and was reimbursed and apologized too. Fact is there will always be problems with machines, but customer service at blockbuster is great.


EvenceIdednuh 3 years ago

I used to acquire on top of lifetime however lately We have built up the amount of resistance.

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    NCR Overview of Blockbuster Express

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