Competitive Spheres for a Video Company
You are the marketing manager for a video rental chain. You have been asked to define the major competitive spheres within which your company will operate. Respond to the following competitive elements.
- Industry
- Products and Applications
- Competence
- Market Segment
- Vertical
- Geographical
Definition of major competitive spheres for the company
Industry
The industry has a major function in the video rental business established in 1988. Further, the industry is a continuously fluctuating industry that mainly contends with a country’s development, economy, and technological advancement. The initial industry players started with small outlets possessed by the locals that rented discs and videos containing various films, games, or even shows. Blockbusters have become an outstanding firm with a highly distinct approach and dimension, defeating most outlets and developing organizations. Further, the model was altered to DVDs from VHS by Blockbuster. However, via investment in the disruptive approach in 1988, Blockbuster experienced a huge impediment with the application of VOD techniques that incorporated emailing such DVDs to the clients (Li, 2020). The innovation overcame the inconvenience of the clients required visiting the rental outlets. It removed the pressure of returning such rentals within the stipulated period to eliminate the relevant late charges. Blockbuster became insolvent in 2010 due to its incapability to keep up with industrial modernization. Besides, Netflix converted to online streaming with the advantage of enhanced wideband. Also, the technological development have created certain challenges and increased competition for firms in the sector, with the main players including Amazon Prime, Redbox, Hollywood video, Movie Galley, and Hulu.
Product and applications
Technological advancement has been the most controversial and prominent aspect of the industry. Its products and applications are perceived as essential to the effectiveness of such firms. Blockbuster had about a thousand titles in DVDs and VHS formats, lowering the risk for higher rental volume. On the other hand, Netflix offers more than ten thousand online titles for its numerous online clients. Nevertheless, the local outlets should have between 10-30 thousand titles in all applicable formats since clients could demand any title in their preferred format. In 2012 the technology had developed, which seen the Redbox offer an improved degree of movie presentation providing DVDs and high-definition Blu-ray format for the new release, providing a theater-like occurrence at the client’s home. Also, clients preferred classic films, thus, necessitating the firm to maintain an exceptional track and store of the old and rare films in VCDs, tape cassettes, Blu-ray, and other forms. Most of these outlets can stock movie variety in their collection, which includes foreign and rare adventures and documentaries
Competence
The competence in this sector is the continuous development and the provision of service in innovation, uniqueness, and easily accessible conveniently. Besides applying diverse algorithms, organizations inquire about clients’ preferences in songs and movies and offer recommendations where necessary (Xu, Frankwick & Ramirez, 2016). A good stock and combination of latest and old, classical and adventures films, documentaries and cartoons, all have a huge role in ensuring competency in the sector. Though sorting them could be time-intense for the corporate owners, it presents a more individualized feel for the clients. Redbox applies a computerized self-service kiosk, a speedy interactive navigation technique for selecting the needed film. However, Netflix and Amazon Prime offer the clients a more comprehensive description of their selection, similar to the movie theater preview (Sim, 2016).
Market segment
The industry operates with two main market segments. The baby boomers and generation X primarily prefer the older technology and library format browsing. The second segment, millennials and Generation Z, prefer surfing the internet, in-store, and social media reviews and recommendation and are intrigued by classical and sophisticated films. The company adjusting the all generation’s demands could be very challenging; however, it should be innovative in selecting the marketing approach with a personal touch, including promotional periods, open houses, and individual referrals, ensuring client loyalty.
Vertical
The vertical marketing approach mainly focuses on learning about the products using the insight and input from the clients, which would allow the company to develop innovative products and services (Bartolacci, 2021). Most firms often rely on other businesses for their development. Thus, focusing the company’s marketing approaches on the targeted clients within the market segmentation, the sector can present the opportunity for further development. Demonstrating proficiency within the industry and catering to distinctive customer demands can provide the company an opportunity to attain a competitive advantage.
Geographical
In this business, the population and individuals residing in a particular location can determine the level of the firm’s effectiveness. The firm’s outlets are located across the nation, though Redbox and other independent movie stores also use the same strategy. Hence, the company has a geographical disadvantage, though it can use its market segmentation and vertical marketing approaches to ensure a competitive edge.
References
Bartolacci, G. (2021). What is a Vertical Marketing Strategy? New breed. Retrieved from: https://www.newbreedrevenue.com/blog/vertical-marketing-strategy
Li, C. (2020). Strategy Case Study Series: Netflix Effect, Leading Disruptive Change in a Digital Economy. LinkedIn. Retrieved from: https://www.linkedin.com/pulse/strategy-case-study-series-netflix-effect-leading-disruptive-carl-li
Sim, G. (2016). Individual disruptors and economic gamechangers: Netflix, new media, and neoliberalism. The Netflix Effect: Technology and Entertainment in the 21st Century. London and New York: Bloomsbury Academic, 185-202.
Xu, Z., Frankwick, G. L., & Ramirez, E. (2016). Effects of big data analytics and traditional marketing analytics on new product success: A knowledge fusion perspective. Journal of business research, 69(5), 1562-1566.
