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The Los Angeles Times reports that bankrupt Blockbuster “will this week launch its first nationwide advertising campaign since 2007. The goal is not only to advertise what the company sees as its advantages over competitors Netflix and Redbox, but also to let consumers know that despite widely publicized struggles, it's still open ... Blockbuster has fallen behind its competitors in recent years as consumers have flocked to Redbox's kiosks, which rent out movies for $1 a day, and Netflix's DVD-by-mail subscription plan, as well as a growing number of digital options. Blockbuster now offers its own versions of all those options, but the other companies had a head start.”
KC's View:
Beyond the fact that Blockbuster for too long remained loyal to a business strategy that was increasingly irrelevant, the additional problem is that while it was treading water, the competition was moving forward and continues to do so. It is like Netflix and Redbox both realized that the market was in flux, and that they needed to have a long-term strategy to com pete with iTunes, not a short-term strategy to compete with Blockbuster.

What Blockbuster really needs is a game-changer. But it’s hard to do that when you need court approvals just to run an ad campaign, and you’re preparing to close up to 25 percent of your fleet. All those empty buildings send a powerful message to consumers, and it isn’t a positive one about Blockbuster.