Essay on Red Box Case Study

1168 Words Mar 18th, 2013 5 Pages
1. What are the chief elements of Redbox’s strategy? Which of the five generic competitive strategies discussed in Chapter 5 most closely fit the competitive approach that Redbox is taking? Defend your answer.

The chief elements in Redbox’s strategy are:

a. Attracting customers with low prices and convenience.
Charging customers $1 dollar per day as a rental fee is very attractive to users and the firm. It is attractive to customers because their nightly entertainment is very cheap in comparison to other alternatives. It is beneficial to Redbox because in the event that the customer forgets to return the movie, they are charged double the rental amount which doubles revenues instantly.

b. Rapidly increase the number of
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By having several locations they are also able to keep revenues high. Redbox has focused on a broad range of consumers located in a broad range of areas. Just by providing several locations, Redbox immediately has more access to potential customers than any other firm in the market.

2. What type of competitive advantage is Redbox trying to achieve?

They are trying to achieve a competitive advantage that includes low prices, convenience, a recognizable brand, and a strategic replica of Coinstar.

3. What does a SWOT analysis of Redbox reveal about the overall attractiveness of its situation and future prospects? Give at least three responses to each.

The strengths reveal how attractive this service is to customers. It also demonstrates the affordability and convenience of the kiosk. The attractiveness of the brand name attracts more customers and the ability to keep cost low is attractive to the firm’s bottom line. Customers are satisfied and the firm has also been able to maintain customer loyalty with percentage off promotions.

The weaknesses are the company’s inability to make the rented movies available to customers via the internet. This can be a problem when customers don’t want the hassle of having to wait in line, leave home to pick up a movie, or remember to return a movie.

The opportunities are available to expand Redbox in various geographical regions around the world. Kiosks can

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