Rented a couple of flicks the other day from the video store and I couldn't help but think that the traditional video store is a business model headed down a one-way street with a brick wall at the end...
The first bite into the video store's market share is undoubtedly going to come from subscription based companies like Netflix. These companies give a larger selection and give you the opportunity to watch at your leisure – keep the films as long as you'd like without fear of late fees.
The next, and likely largest bite will come from the low cost of actually purchasing a DVD. Go to Wal Mart, Best Buy or Amazon and you can find new DVDs for as low as ten bucks. When the difference between renting and owning is so slim, which do you think will win out?
The kid down the street is able to download a bootleg over the course of a day or two. In a few years he'll likely be able to download a legit copy in just a matter of minutes. The internet is slowly changing the market for music – it's not long before it does the same for film.
There's no way for the video store to combat technological changes. The only thing to be done there is to keep an eye on the developments and unload the business for a reasonable price before you're obsolete. The time to sell your buggy whip store is when the Ford is in development, not when the car dealership opens in town. However, I do have three suggestions of how the video store can compete in the years before technology gives a hammer blow to the entire video distribution industry.
Suggestion the first - The Trip is Half The FunEnhance the experience of actually going to the video store. Half the fun of movies is the experience of it – standing in line, munching on the popcorn and sipping the pop, sitting in a darkened theatre with an audience of strangers. Even the kid down the street who downloads the bootlegs is going to shell out the money for the experience of the theatre.
So what can we do to enhance the video store? Well, first I'd introduce food of some sort. Enhance that visual stimulus with some smell and taste. The StarBucks kiosks certainly work for the book stores, they can probably work just as well at the video store. Event based events can turn the store into a destination. Get local celebrities in. Okay, you won't get Harrison Ford in, but you may be able to get the fellow who was the Storm Trooper in scene 18. You won't get Spielberg in, but you can get a Film Professor from the local university who would be glad to talk to a crowd about what makes a good film. Host mini-filmfests. Make every Thursday night a film fest at your store. Pick a theme and pull together three or four gems that fit that theme and run them throughout the night.
Do whatever you can do to make your store a destination – and not just a stop.
Suggestion the second – Be The ExpertEvery member of staff should be a film geek. They may not of watched every film in your store, but they sure as heck should certainly be trying. I want my store clerk to be able to steer me towards films I might not otherwise have watched, but will doubtless enjoy. I want the clerk to be able to tell me if a film is so bad it's good, or just plain bad. I want a clerk who can pick up on the cues of what I'm renting and recommend additional films.
Okay – so maybe we can't make every clerk an expert. But we can use the tools at hand to make them one. Likely each of your customers have an individual member card with a unique id code. Why not make use of that and start building unique profiles of your clients? Add into your database your customer's preferences. Try to find out if they enjoyed the movies they rented. Develop your own recommendation system based on the trends you see with your clients.
This should be the added value of going to a video store. An expert who knows my tastes and will cater to them.
Suggestion the third – Try and then BuyStrange as it would seem – the video store is not the place we go to buy movies. When we think of the video store, we think of a one time rental. As far as I'm concerned, this is an opportunity that's being completely missed. If I owned a video store, I would want to be the one and only place my customers thought of when they think of buying films. And it would be so easy to use the existing video store model to drive sales of new videos.
Renting a video should be seen as a test drive. Not sure if you want to spend $27.95 on a video? Rent it for $2.99. If at the time of returning your DVD you've decided you want to buy it, you'll receive a discount equal to the rental fee.
Yes – Wal Mart and Best Buy will almost always be able to offer a lower price, but you are the one who's got the customer in your store at the moment they're most likely to purchase. All it would take is for your clerk to say “if you enjoyed that film, we'd be glad to credit your rental fee from the purchase price.”
Watch your sales jump.