Democrat Special Report: In the Movies

‘Business booming’ for Family Video Local video store says customer service can’t beat Netflix, Redbox
Sep 13, 2013
Courtesy of MCT

With mediums like Netflix and Redbox, video rental stores have become somewhat of a dying breed.

Yet Family Video in Lebanon is still going strong.

In fact, Tyler Bostwick, manager of the Murfreesboro Family Video for five years who’s working double duty in Lebanon this week, said, “business is booming.”

“My store in Murfreesboro has been up the past three months, and I know the Lebanon Family Video is up in revenue,” Bostwick said. “Like any other rental industry, we’re controlled by the titles coming out, so if we have good titles it’s going to enhance our business.”

Bostwick said Family Video was started in 1978 in central Illinois by Charlie Hoogland and was named that because the business is family owned.

“Charlie is the CEO, the company president is his son, Keith, his other son, Eric, are the vice president and the regional vice president as is his son-in-law, so it truly is a family business,” Bostwick said.

Bostwick said when Hoogland started the company his biggest focus was on customer service and creating an atmosphere where people had a good experience so they would come back.

“Customers come in and they know the people who work here by name,” Bostwick said. “They want recommendations from us because they trust the movies we watch, and they know we know what they like.”

Bostwick also said it’s hard to beat the prices at Family Video, with most movies, except new releases, costing $1 for five nights, and all children’s movies are free. The store also features a section with more than 6,000 movies that are two-for-$1.

“These movies have long since paid for themselves,” Bostwick said. “I think that furthers the customer service aspect, because if you haven’t seen a movie that came out in 1996, it’s sitting over there waiting.”

Bostwick said the store makes its money off new releases, which come out every Tuesday.

“It’s renewable revenue. If we bought a movie for $8, and it’s been here for 10 years, it’s been making money for seven and a half years,” Bostwick said.

According to Bostwick, working whatever and however needed to make the customer happy is the biggest thing at Family Video, which he thought is how it differed from Redbox.

“Initially Redbox hurt business mainly because it’s convenient,” Bostwick said. “As it went along, there’s no customer service at Redbox by design. If you movie is late because you’re sick, it doesn’t matter you pay your late fee. There’s no person you can explain your situation to.”

Bostwick said at Family Video, if life gets in the way, they’ll work with you.

“We’re willing to go above and beyond to work with individual circumstances to make sure the customer leaves happy,” Bostwick said.

Since the initial blow Family Video took after Redbox started, Bostwick said business was back to normal and going up.

“We will always, always have a better selection than Redbox because they can only fit so many movies in that little box,” Bostwick said. “And Redbox tells you what you can rent, whereas you come in here and you can decide what you want to watch.”

Bostwick said Family Video’s mission is to be their community’s first choice in entertainment.

“We don’t just want to be the first choice in movies, but we’d rather you come rent a movie then go bowling or out to dinner,” Bostwick said. “And 75 percent of the time, we’re the cheaper option.”

Bostwick even said when the recession hit; business actually went up because people weren’t going out as much.

Family Video also has almost 800 stores nationwide, but each one runs as if it’s locally owned, said Bostwick.

“They’ve found an excellent balance between being a large company and running it as a small business,” Bostwick said. “In my opinion that’s what allows them to focus so much on customer service, which is why people choose to come back.”

Growth of Internet television

Neither Netflix nor Amazon were on stage Wednesday, but the growing clout of these online video distributors was nonetheless felt at a San Francisco conference focused on the future of TV.

As the rival services bid against one another for exclusive rights to popular movies and TV shows, in a manner that recalls the rivalry between premium cable networks HBO and Showtime, the fallout has been unmistakable, said Shawn Strickland, chief executive of Redbox Instant by Verizon.

"It's gotten more expensive," Strickland said in remarks at the Broadcasting & Cable's NextTV Summit. "It's gotten more competitive, with Amazon and Netflix pursuing exclusive rights."

Bidding wars are probably music to the ears of Hollywood executives, seeking to obtain top dollar for digital rights to popular TV shows such as Nickelodeon's "SpongeBob SquarePants" or a billion-dollar blockbuster such as Marvel Entertainment's "Iron Man 3." But it also raises the barrier for those seeking to enter the rapidly growing Internet video market.

"It's changed the playing field," said Strickland.

The 6-month-old service is seeking to carve out a space among consumers who are just discovering Internet video services. Although Redbox Instant has been available on Microsoft's Xbox 360 game console, Samsung's Internet-connected smart TVs and on the web, as well as through Blu-ray disc players, a deal reached last month with Roku has been a boon to the service.

"It fits that consumer who is beginning to transition to streaming – which is right where our product plays," Strickland said.

Subscribers who pay $8 a month get unlimited access to its online movie and TV library, though non-members can use the service to rent or buy movies on-demand or reserve a DVD to be picked up later at one of Redbox's distinctive kiosks.

Although the event followed one of the most hotly anticipated events in Silicon Valley, Apple Inc.'s unveiling Tuesday of the latest update of its popular iPhone smartphone, the technology announcement that fueled the greatest enthusiasm among these digital media executives was one made two months earlier – Google Inc.'s Chromecast, the 2-inch-long, $35 gadget that enables users to connect Apple and Android devices to the biggest screen in their home without ever touching the remote control.

Brightcove Chief Technical Officer Albert Lai said Chromecast is an inexpensive, easy-to-use alternative for consumers looking to watch Internet video on their living room TV – without investing in a new, connected TV.

"Do you buy another receiver? Pay more money?" said Lai. "Google comes out, you have a dongle that costs $35. Now you can buy three of them" to plug into every TV in the home.

– The Los Angeles Times via MCT contributed to this report

Redbox’s Top 10 DVD rentals

These were the Top 10 DVD rentals at Redbox kiosks from Sept. 2-9:

1. Now You See Me — Summit

2. Oblivion — Universal

3. Pain and Gain — Paramount

4. Empire State — Lionsgate

5. Olympus Has Fallen — Sony

6. The Place Beyond the Pines — Universal

7. 42 — Warner

8. Scary Movie 5 — Anchor Bay

9. Mud — Lionsgate

10. The Iceman — MMS

Source: MCT

Family Video’s Top 10 DVD rentals

These were the Top 10 DVD rentals at Family Video in Lebanon from Sept. 2-9:

1. Now You See Me

2. Star Trek: Into Darkness

3. Epic

4. Olympus Has Fallen

5. The Great Gatsby

6. G.I. Joe

7. 42

8. Scary Movie 5

9. Pain and Gain

10. The Call

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