Customer can multiple DVD’s
The company’s value proposition is value, convenience, and selection. Entitle moved from a Web portal to a subscription service because of customer dissatisfaction with pricing and delivery.
This new model got rid of the late fees, added new groups of fans and gave the customer more value and convenience for what they were paying for. Nineteen’s biggest problem was the cost of acquiring each DVD and they could keep costs down by marketing for lesser known movies. To improve selection while also keeping costs down, Entitle implemented their proprietary recommendation system to keep customer demand balanced.
This system would rarely recommend new movies, it would screen movies that were out of stock, it gave a much larger selection to customers, while keeping customer satisfaction high and making it more convenient. Two other things Entitle did to carry out its value proposition was negotiate a revenue sharing agreement and expand distribution centers. 5.
When Entitle first came Into the marketplace, they were charging $4 per rented movie, $2 for shipping and handling, and charged late fees.
Feedback from early customers showed dissatisfaction with how Entitle charged prices similar to rotational competitors, while also having a slower delivery service. So Entitle went to a stipulation model winner customers could nave Tour movies In tenet possession at any time and receive up to four additional movies per month. Not to long afterwards, Entitle switched their pricing model again to allow customers to have three movies in their possession at any time and allowed for unlimited amount of rentals for a monthly fee of $17. 9.
The reason they changed the subscription model so fast was because it would simplify the program, allow for Entitle to communicate their service utter, and use the term “unlimited” in their marketing efforts.
If a customer can multiple DVD’s at one time, then the delay for delivery time is inevitable because they always have a movie or two with them. The goals of these changes were to gain better customer satisfaction, gain more customers, and provide more convenience and value. . Before Ted was hired, Entitle was spending a large amount of cash to obtain copies of DVD’s and needed to find new ways to lower costs. Ted Sarandon was hired to manage content acquisition and within a year, Entitle had negotiated direct venue sharing with most of the major studios.
Instead of paying an up-front cost of $20 per DVD, the studios would reduce their up-front price in return for a fee based upon the title’s total numbers of rentals for a period of time.
He generated customer awareness and for some lesser films, between 60% and 75% of their earnings came from Entitle. 7. The structure of the emerging VOID market is that viewers would search through a vast library of movies online and watch them in full screen on their television or computer. The increasing popularity of content delivery with such ethos as high definition, pay per view, and streaming internet videos; hints at the fact that the VOID market will be substantial. The VOID market had two noticeable limitations: technology and content availability.
It was perceived as limited until hardware that could connect a users computer to the television become more available. Furthermore, studios were reluctant to offer much content because of fear of illegal downloads. This market was attractive because it offered more convenience to customers while having the chance to cut costs. Customers would have no wait time and could immediately stream content. .
One challenge Hastings faced was that customers would no longer have to choose between selection and impulse rentals.
Another critical problem they faced was the obvious lack of customer demand for online viewing. The first strategy involved Entitle offering their proprietary recommendation system to cable company’s seeking to enhance their VOID offering, through a licensing agreement. The second strategy was to integrate a streaming online video feature into its core offering. Entitle could still offer its existing business, while increasing penetration into the VOID market at no additional cost. The third option considered the merits of building a stand alone online video business.
If I had to recommend a strategy then I would advise Hastings’s to go with the second option. I prefer this one because it allows Entitle to differentiate from start-up competitors such as Bongo and Involving. Some of the positives I believe with the second strategy are: it’s the lowest risk, the lowest cost, it promotes Entitle more, and it attracts a younger internet consumer base. 9. According to a Yahoo article written by Dave Moment, Entitle considered making the DVD part of the equines separate from Entitle and call the service Skitter.
They abandoned this strategy and you can still choose between either of the two today or both,while being under the name of Entitle. The outlook of the company is great, with Entitle Just passing HOBO Tort ten under AT schedulers In ten u s Ana Entitle stock NAS more than tripled in the past year. Also, Entitle is currently in negotiations with cable companies to add their service to set-top boxes. I would buy stock for Entitle because they are still finding new ways to expand and their stock is continuously growing.
