In an attempt to boost drooping revenue growth, Blockbuster reinvented itself Monday with a new marketing campaign, using the slogan "One World, One Word: Blockbuster." Noticeably missing from the new logo and advertisements is the word "video."
"We're taking it to another level - Blockbuster has been an entertainment leader for years, and we want to broaden the entertainment we offer to our customers," says a company spokesperson.
Having already supersaturated America with video-rental outlets, Blockbuster is now looking to boost sales by stocking its chain stores with alternative media. Blockbuster customers will soon find magazines and books, videogames, CD-ROMs, software, confections, toys, and clothing alongside copies of The Little Mermaid. The move to expand its entertainment inventory beyond a single category (in this case, videos) follows a trend established by Virgin Megastores and Tower Records.
Analysts aren't as optimistic as Blockbuster about the company's recent performance: Although Blockbuster grew phenomenally during its early years and through its purchase by Viacom in 1994, growth of retail sales at the chain dropped 4 percent during the first three quarters of 1996. An expansion into music has also been less than successful, and the company recently announced that 10 percent of the 500 Blockbuster Music stores will close in 1997, The Wall Street Journal reports.
"Their growth rate slowed down, and they have to do something to start increasing revenue," says analyst Harold Vogel of Cowen & Co.
The US$12 million campaign will air during football games and prime-time sitcoms during the first weeks of January, and will usher in a year during which Blockbuster plans to open an unprecedented 500 new stores.
