Word: videos
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Dates: during 1980-1989
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During the early 1980s, video shops were the hottest gambit for do-it- yourself entrepreneurs. "It seemed to be an easy-to-operate business, and the amount of money needed to establish it wasn't that great," recalls Walter Rosselle of North Hollywood, Calif., who is planning to sell his shop after 2 1/2 years in business. Because of newly arrived competitors, his daily tape rentals have dropped from 130 to about 75. A survey of 1,200 video stores conducted in January by the trade publication Video Store showed that 28% of the merchants were dueling with another store...
While many small, independent shops are still thriving because consumer demand continues to grow, the large national chains have started to grab most of the new business. National Video of Portland, Ore., which opened its first outlet in 1981, has 776 franchises in the U.S. and opens an average of 15 new shops every month. The convenience-store chain 7-Eleven plans to offer its MovieQuik rental club, which has no membership fee, in 7,000 of its 7,636 outlets by the end of the year. MovieQuik's feature attraction is speediness; because each member's account data...
Other rental emporiums attract customers with monstrous selections. California-based Tower Records has opened a series of video superstores that stock 10,000 movies, compared with the 2,000 titles in a typical neighborhood shop. With so many alternatives, few consumers feel any loyalty to one store. If the movie they want is out of stock, they simply drive a few blocks to a competitor's shop...
...independent video-rental shops have been pinched as well by the falling prices of prerecorded cassettes. Movie studios have drastically lowered prices < in the hope that consumers will purchase tapes rather than rent them. According to the Fairfield Group, a market-research firm, the average price of a prerecorded cassette has fallen from $51.60 in 1984 to $27 this year. Many classic movies now sell for only $19.95, and children's films often go for $14.95. This has prompted many mass merchandisers, notably Sears, to start selling cassettes in their stores. Mom-and-pop shops, which started out in rentals...
Potentially the most prolific tape dispenser is the video vending machine, which will accept a charge card for payment and deposit. More than 20 companies are developing devices with names like Le Bijou and the Movie Machine. U.S. Video Vending of Iselin, N.J., has already installed 100 soda- machine-size devices in apartment buildings, supermarkets and malls. One manufacturer predicts that 60,000 video vendors will be in operation...