Netflix or bricks and mortar video shops

Now, I have been enamoured of the Netflix model for some time. For those of you living in a cave for the last five years, Netflix is the number one provider of DVDs by post in the US. You pay a fixed fee by month depending on the number of DVDs you want to hire at once. On their website, which includes thousands of possible DVDs, you create your wishlist. Films on your wishlist are sent to you by post until you have your full number of DVDs. You watch what you want and pop them in the postbox when you are done. New titles are sent by return. There are no late fees.

We have two local video shops that I can go to (Videoland and Videoworld), and have been known to frequent both. At both you can buy €100 of credit for €70 (or less). In this way, you can get a video that normally costs €5 for a couple of days for about €3.50. However, if the video is even a few hours late, you pay — through the teeth.

A year or so back, I’d forgotten that I’d hired a video from Videoland. The DVD was stuck there in my cupboard along with all of the DVDs I owned. We went on holiday and came back. At no point did the shop call me up and ask me where the video was. They sat back and raked in the money. When I found it and brought it back, they asked me for €100. I was able to negotiate it down to €60. Ouch. Twenty DVDs right there. It’s sure one great way to lose a customer. But, after a few months of letting the pain die down, I went back — but only because there was no other real choice. Not a great way of running a business.

So, recently I started looking at how I get my hands on the Netflix model here in the Netherlands. There are a few alternatives… but that’s for another post.

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