Portals to Promote Blockbuster's DVD-by-Mail Play

  |  August 11, 2004   |  Comments

Banners on AOL and MSN are promoting Blockbuster's answer to Netflix, but that's just the start of their involvement in the venture.

Blockbuster has tapped America Online and Microsoft's MSN to promote the new online DVD rental service, a competitor to Netflix, announced Wednesday.

The two portals will at first promote Blockbuster's new movie-by-mail offering through a combination of banners and promotional text links. In the future, however, Blockbuster Online subscribers will be able to manage their accounts through AOL and MSN.

AOL will integrate the offering with its entertainment properties, including Moviefone.

"What we're doing now is broad reach advertising to get the word out about Blockbuster and AOL's relationship," said John van Suchtelen, director of e-commerce for AOL entertainment. "With our entertainment properties, we're integrating the promotion into the pages. The hub of it will be within AOL movies, but we'll distribute it in places throughout AOL that make sense. In Television for TV DVDs, for example, or in Music for concert DVDs."

Letting customers manage their movie queues through Blockbuster's portal partners is the first step in an overall strategy to enable multiple Web locations for the new online service, the movie rental company said.

MSN declined to comment on the Blockbuster relationship, but hinted it was part something bigger afoot at MSN Entertainment.

The new service from Blockbuster is very similar to that offered by Netflix and rivals like Wal-Mart and GreenCine. For a monthly fee of $19.95, subscribers get unlimited rentals and can receive up to three movies at a time. To create an incentive for sign-ups, Blockbuster is offering two free in-store movie rentals a month to new subscribers.

"We think now is the opportune time for Blockbuster to enter the online rental business, and we plan to quickly establish ourselves in this arena by aggressively marketing, pricing and combining our online program and in-store capabilities," said Shane Evangelist, VP and general manager of Blockbuster Online.

Promotional material on Blockbuster's home page displays the Field of Dreams video with the tagline, "If you click it, it will come."

Blockbuster's move toward online rental is part of a strategy to offset its plummeting in-store rental business. In its second-quarter earnings report, the company said declining rental demand had resulted in a 23.5 percent dip in profits. Netflix also disappointed, reporting substantial subscriber growth but a lower-than-hoped-for profit. The company's stock fell precipitously.

The interactive ad market, ironically, actually appears to be one cause of Netflix's woes. The DVD-by-mail pioneer reported it expects its customer acquisition costs to rise in 2004's third quarter, at least in part because of price increases it has observed in online advertising. Netflix said that trend has caused it to back off its interactive marketing spend in favor of a bigger TV buy.

ClickZ Live Toronto On the heels of a fantastic event in New York City, ClickZ Live is taking the fun and learning to Toronto, June 23-25. With over 15 years' experience delivering industry-leading events, ClickZ Live offers an action-packed, educationally-focused agenda covering all aspects of digital marketing. Register today!

ClickZ Live San Francisco Want to learn more? Join us at ClickZ Live San Francisco, Aug 10-12!
Educating marketers for over 15 years, ClickZ Live brings together industry thought leaders from the largest brands and agencies to deliver the most advanced, educational digital marketing agenda. Register today and save $500!


Zachary Rodgers

Until March 2012, Zach Rodgers was managing editor of ClickZ's award-winning coverage of news and trends in digital marketing. He reported on the rise of web companies, data markets, ad technologies, and government Internet policy, among other subjects. 

COMMENTSCommenting policy

comments powered by Disqus

ClickZ Today is our #1 newsletter.
Get a daily dose of digital marketing.



Featured White Papers

Gartner Magic Quadrant for Digital Commerce

Gartner Magic Quadrant for Digital Commerce
This Magic Quadrant examines leading digital commerce platforms that enable organizations to build digital commerce sites. These commerce platforms facilitate purchasing transactions over the Web, and support the creation and continuing development of an online relationship with a consumer.

Paid Search in the Mobile Era

Paid Search in the Mobile Era
Google reports that paid search ads are currently driving 40+ million calls per month. Cost per click is increasing, paid search budgets are growing, and mobile continues to dominate. It's time to revamp old search strategies, reimagine stale best practices, and add new layers data to your analytics.




    • GREAT Campaign Project Coordinator
      GREAT Campaign Project Coordinator (British Consulate-General, New York) - New YorkThe GREAT Britain Campaign is seeking an energetic and creative...
    • Paid Search Senior Account Manager
      Paid Search Senior Account Manager (Hanapin Marketing) - BloomingtonHanapin Marketing is hiring a strategic Paid Search Senior Account Manager...
    • Paid Search Account Manager
      Paid Search Account Manager (Hanapin Marketing) - BloomingtonHanapin Marketing is hiring an experienced Paid Search Account Manager to...