Case Study Analysis - Essay Example

The movie industry is in a stage of transition. The transition has resulted in various developments in the sector. The technological advancements are offering entities in the film industry new channels of distributing movies. Therefore, the entities have to make the required changes to the distribution strategy to benefit from the changes that are sweeping the industry. This article analyzes the above scenario using three organizations operating in the sector. The entities include Blockbusters, Netflix and Redbox.

The entities face distribution uncertainty owing to changes in the movie rental sector. The changes primarily pertain to clients’ distribution channel preference. Blockbuster is an organization, which has suffered terriby owing to changes in the distribution of their products (Chopra 4). Initially, Blockbuster earned majority of its income via store rental services. However, in years leading to 2010, its revenues were decreasing. Addressing such a major drop in income required drastic measures.

The measures would entail the Blockbuster adopting other means of distributing movies. The dip in Blockbuster’s profitability emanated from industrial changes. Therefore, the movies sector posses a higher risk to the firms, which distribute products resulting from the industry. In the evaluation of industrial risks, firms in the film sector would have higher-level relative organizations in other sectors. The entity relied heavily on stores renting DVDs. However, the technological advancement allowed the clients to access films via other means without requiring purchase or renting of discs.

This resulted in the dwindling of Blockbuster’s fortunes since they relied heavily on the two channels. Failure to adapt to the changes in customers’ preferences culminated in the dipping of the entity’s finances (Chopra 5). Recommendations Netflix has demonstrated in numerous dimensions what Blockbuster should undertake to revive its competitiveness in the currents market. First, the entity should offer its clientele additional means of accessing movies. Netflix distributed movies through several methods, which included rental, mail, and digital downloads.

Contrary, Blockbuster only offered two channels of distributing films. These methods were being overtaken by other cheaper and efficient methods, which were mail delivery and digital down loads. Blockbuster sought to position itself appositely owing to the changing customer preferences. Therefore, it undertook various measures, which included offering delivery of discs via post. Additionally, Blockbuster switched entirely to distributing movies in DVDs form which was cost efficient. The entity also offered online services by launching Blockbuster total access program.

This enabled the clients to rent movie online or down load. Therefore, the entity was adhering to the changing customer preferences. In this industry, it is vital for the entities to analyze the merging trend since they seem to transform the industry rapidly. Failure to inculcate such trends in the product design would be detrimental. Netflix has advanced its online services. The clients have countless options. This made its online services more popular. Nonetheless, Blockbuster’s online program provided their clients with a much-reduced variety.

Its searching system was inefficient. Owing to the changing industry coupled with dwindling finances, the entity had to change several things. The entity closed