#21
|
||||
|
||||
Triple post because I am feeling like it.
OK, so this is not seen as spam I will answer his question in part. There can never be a model because each store is different and each movie is different. Add the variations of the weather and in some cases what week of the month it is and you just never know ... Unless, of course, it is the Kink O Rama series. They rent all the time (Mom's being a smartazz again) No one is answering you with a straight answer because there isn't one.
__________________
For those who believe no explanation is necessary.
For those who do not, no explanation is enough. |
#22
|
|||
|
|||
Quote:
I, of course, don't know how many could sell but it seems promising. Consider that Blockbuster is managing to sell movies for 20$ when they are 15$ from WalMart in the first week. Why wouldn't they succeed at selling movies for 15$ when Walmart is 18$ the next week? Not everyone shops at Walmart, particularly every week. Not everyone knows the exact week that a movie comes out, and Walmart only discounts early. DVD buying is often an impulse purchase. Or look at it this way, because my 15$ price point is somewhat arbitrary. As soon as you have more copies than you will ever need to rent, you should start selling. Pretty much whatever price you can sell at in week 2-4 is going to be higher than what you can get after week 4, right? My preliminary guess is that at 15$ in week 2, you can sell a movie to 1 out of every 7-10 people that would have otherwise walked out with a rental of that same title and that this can be kept up by dropping to 12$ if necessary prior to week 4. This could be improved if Blockbuster markets the fact that they have a competitively priced used DVD business and draws in additional customers expressly bent on purchasing movies. What is the current ratio of sales to rentals at the horribly uncompetitive price of 20$?
__________________
"Damn you Antioco! Damn you!" - me Last edited by NetflixInvestor; December 13th, 2007 at 09:17 PM. |
#23
|
|||
|
|||
Quote:
Couple of things. (1) Blockbuster could easily test your rev share vs. outright purchase theory. If it's true that Disney is so stingy in its rev share that some Blockbusters are only allocated a dozen copies of popular titles such as High School Musical, then perhaps Blockbuster should experiment outright purchase with Disney titles. In fact, Disney titles (kids titles) might be ideally suited for resale, since kids tend to watch their favorite movies dozens of times. As a result, by targeting the kids market Blockbuster might be able to mitigate some of the asset risk typically associated with outright purchase. (2) IVR apparently also posts on the Yahoo messageboards, and a few months back he posted the following regarding revenue share, which might help you in analyzing the economics of rev share vs. outright purchase: Quote:
|
#24
|
||||
|
||||
I'm not going into how well it works or any detail but just wanted to point out that in the UK we have got rid of revenue share and we buy our movies outright, but we are still limited to how soon we can sell them as PV movies. So BB are already trying this and we will see how things go.
|
#25
|
|||
|
|||
I agree that Blockbuster is capable of testing the demand for used product on those titles they don't rev. share, and that kids movies are probably the most successful category. I think that selective testing will indicate lower demand than can be ultimately generated if the company decided to actively pursue this segment and market for it. After all, the reason so many retailers literally sell DVDs for a loss is to drive traffic.
Thank you for digging up the Yahoo post. It's nice to see details on the up front and buyout component of the deal as well as his various estimates for how much sells and what price within 6 months. I need to incorporate this data. I suspect it will tilt things against my wholesale theory.
__________________
"Damn you Antioco! Damn you!" - me Last edited by NetflixInvestor; December 14th, 2007 at 02:20 AM. |
#26
|
|||
|
|||
we have to wait at least 28 days (the 28th day would be a Tuesday so we normally wait till the following Sunday to do PRP transfers so it actually takes more than a month before we can sell them used), unless customers that have purchased the movies wish to trade them in to us (if they hated the film). That happens very rarely, but if someone were to come in today and trade in Superbad, we'd have every right to sell it used and it would sell right away.
|
#27
|
|||
|
|||
Quote:
On "selected titles" such as Pirates Disney will give BB market development funds which brings down the cost per copy to about $13-$15 which is still a few dollars more expensive that revsharing...IMO if BlockBuster wants to solve their copy depth program they have to bring back late fees and shorten the rental terms |
#28
|
||||
|
||||
To many Netflix guys around here
__________________
It's been a Fun Ride, THANKS!! Old Friends!! ROYAL GUARD The top Poster!
|
#29
|
|||
|
|||
IVR, in the comments that NGB quoted you don't explicitly give the rev.share for the revenue from selling the titles. Am I correct to infer that it is the same 28-30% as for rental?
If so, does that imply that you are selling 50% of titles after day 30 for an average of 10$ (10$ * 30% * 50% of titles = ~1.75$)?
__________________
"Damn you Antioco! Damn you!" - me |
#30
|
||||
|
||||
Quote:
__________________
For those who believe no explanation is necessary.
For those who do not, no explanation is enough. |
Bookmarks |
Thread Tools | |
Display Modes | |
|
|