Does Redbox Need to Rethink its Model Before it Becomes the Next Blockbuster?

By Jason Mudd

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Gather ‘round. Here’s a tale of the possible demise of a national brand, Redbox, with lessons to ponder from other national brands like Blackberry and Blockbuster. The takeaway for you is this: Are you doing what you need to do in terms of brand relevance to prevent extinction?

Blackberry users were once so into their technological devices that a term was coined to typify them: “Crackberry” users. It was, of course, a reference to the addictive nature of crack cocaine. But where are those Blackberry users now? They’re giving up their devices for more innovative smartphones like the iPhone and Android.

Blackberry experienced a situation where its innovation failed to keep up with competitors.

Perhaps it’s the same situation with Blockbuster, whose video rental stores got pushed aside rather quickly by Redbox and Netflix.

Some critics of Blockbuster say the company failed to recognize what was going on around the brand quickly enough to make up any ground. However, one probable cause for the death of Blockbuster is Redbox. Founded in 2002, Redbox got backing from McDonald’s Corporation and before long, its kiosks could be found at nearly every McDonald’s chain, grocery store and convenience store throughout the country.

Making matters worse for Blockbuster was the rise of Netflix, which uses an online business model offering a service that charges no late fees and is much cheaper than what Blockbuster could offer. Despite offering fewer newly released and high-quality movies, Netflix and Redbox were able to wipe out Blockbuster.

There are competitors to Redbox now that beg the question: Does Redbox need to change its business model – and enhance the brand value message it’s sending to consumers – to survive? Consumers now have Vudu, Digiboom, Hulu and iTunes as well as access to network apps and websites that stream movies, shows and on-demand services from cable and satellite providers, all of which deliver quality products more conveniently (and from the cloud) than what Redbox can offer.

Consumers are always looking for more convenient ways to shop, even if it means that quality will take a back seat. Redbox has the market cornered on kiosks with tens of thousands strewn throughout the country. But it doesn’t offer television shows like Hulu does; it doesn’t have original content like Netflix recently initiated, or that HBO Go has offered for some time now. Consumers can’t stream to devices like Amazon Prime allows.

Even with the advent of Redbox Instant, some critics wonder if it’s too little, too late. Redbox Instant is a collaboration with Verizon that gives subscribers access to four DVDs every month, access to streaming movies, the ability to rent and buy movies on demand and reserve games at kiosks. With a smart public relations strategy, this continued stream of evolved technology could help Redbox secure a more lasting sense of relevance to buyers – and the time to act is now.

Take a moment to ponder your company’s story. Will you successfully hear, respond to and rally around innovative ideas that can put you ahead of your competitors – especially from the viewpoint of your target audience?

This is the process that the smart, experienced professionals at Axia Public Relations perform on a daily basis. Contact Axia today, and let’s map out what your story will look like a few chapters down the road.

by Jason Mudd, APR

Jason Mudd, APR, is the CEO of Axia Public Relations and an Emmy-Award-winning accredited public relations practitioner, speaker, author and entrepreneur. His public relations portfolio includes work for established national and emerging brands such as American Airlines, Dave & Buster’s, Brightway Insurance, Florida Blue, H&R Block, Hilton, HP, Miller Lite, New York Life, Pizza Hut, Ray Charles and Verizon.

Topics: Media Relations, Public Relations

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