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Blockbuster May Up Its CE Quotient

1/04/2002 01:36:00 PM Eastern

Dallas - Blockbuster may introduce select CE products to its stores by year's end.

The roster would likely include DVD players, VCRs, video game consoles, cellular phones and accessories.

According to senior VP/corporate communications Karen Raskopf, the world's largest video chain will spend the balance of the year examining merchandise mix, price points and developing a program that could put product in place by the end of 2002.

Raskopf said the move was prompted by the success of the company's initial CE efforts, including DirecTV, cables and connectors, and a series of DVD promotions held last summer and during the recent holiday season. Blockbuster has become the No. 2 seller of DirecTV in the 18 months since it was first offered there, she said, and consumer response to the DVD promotions - which included a free Philips player with the purchase of one-year rental card - has been enthusiastic.

Blockbuster's proposed CE mix has also been validated by its 130-unit test of in-store RadioShack kiosks, where top-selling items have included DVDs, VCRs, accessories and cellular phones. (A decision by both parties on whether to continue the test program is expected by the end of the month.) The company has also experimented with a 'home entertainment-centric' offering in its international stores, including Canada where gaming hardware is regularly sold.

Also working in Blockbuster's favor is a trusted brand franchise, its 5,000-plus U.S. stores in high traffic locations, and its 'superb distribution system,' Raskopf said.

'The results make us confident that we have a unique opportunity to profitably sell select, key consumer electronics that compliment our core DVD, VHS and video game software business,' she said. 'There's a market in the future for these types of products in our stores.'

Raskopf added that Blockbuster is 'not envisioning a huge offering - we're not looking to be a Best Buy or Circuit City."

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