Video Concepts, Ince Essay

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Team 2 Video Concepts, Inc. 1. Describe Video Concepts’ business model. Has it been successful? Would you consider Chad Rowan to be a successful entrepreneur? Why or why not? A company’s business model is defined as, “management’s blueprint for delivering a valuable product or service to customers in a manner that will generate ample revenues to cover costs and yield an attractive profit” (Thompson, 2012). Video Concept’s business model is based on providing value to its customers through high quality service, the ability to reserve videos, and its free home delivery. Video Concepts’ profit formula revolves around using its $1.99 rental price per night to generate revenues and increase its market share. Chad Rowan has proven…show more content…
By 1992, future industry growth rates were not looking promising as the market was showing evidence that it was reaching maturity. Technological factors also play a major role in the video rental industry. “Telecommunications companies were accelerating efforts to create an information superhighway to households using fiber optics technology that permitted in-home viewing of movies on a pay-per-view basis.” Although fiber optics technology was still being developed, it presented a major threat to the video rental business. Once developed, this technology would render the need for video rental stores useless. 3. What forces are driving change? The most powerful agents of change in the video rental industry include changes in the long-term industry growth rate, technological change, product and marketing innovation, and the entry of major firms. 4. What are the key success factors in the industry? Low cost, availability, ease of access, breadth of product line, marketing and promotions 5. Is the industry attractive? Why or why not? No. Poor opportunity for growth and profitability. See industry attractiveness table. 6. What are Video Concepts’ distinctive competencies? Does Video Concepts have any resources as defined on page 100? Why or why not? Video games/home delivery/Pricing strategy/High quality service/Selection of New
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