Redbox-Swot Essay

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What does a SWOT analysis of Redbox reveal about the overall attractiveness of its situation and future prospects? The SWOT analysis can be summarized as follows: 1. Strengths a. The company provides both low price and convenience for its customers. Redbox charges over $1.00 per day for its movies. Moreover, Redbox kiosk are places in major retailer’s centers. b. It is the leader in vending kiosk machine segment of movie rentals. As of March 31, 2010, Redbox had 24,800 of installed Redbox and DVDXpress kiosks in convenient for customer locations. c. Coinstar, due to its expertise in deploying and operating kiosks in retail settings, has established very strong relationships with retailers and, at the same time, has secured for Redboxs’ kiosks attractive locations at high traffic areas. d. The ability to reserve movies online at a particular kiosk in close distance from customers. e. Redbox has high customer satisfaction ratings. Over 80% of Redbox customers would recommend it to a friend. f. The high profit margin from a single kiosk machine, which provides revenue of $50,000 and costs $15,000. That results in $35,000 of gross margin. g. Redbox has high brand awareness and recognition among its customers. No other vending machine provider is so well known as Redbox. 2. Weaknesses h. The biggest disadvantage is that Redbox does not provide streaming feature in comparison to VOD providers and Netflix. 3. Opportunities i. By aggressive strategy based on increasing the number of Redbox kiosks, the company can increase its market share because more people will get access to Redbox movies. j. The company can steal away customers from such companies as Blockbuster since its rental prices are significantly lower and locations are more convenient. k. Redbox could expand into foreign

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