"Why Blockbuster Will Never Survive"

Reader and commenter Salviati writes in to share his personal experience with Blockbuster and his theory for why they will never survive fierce competition from Netflix and the new Apple video rentals.

I am writing to explain why I am no longer a Blockbuster Total Access subscriber and never will be again. Service wasn’t always so deplorable at Blockbuster, but in the last several months I have had three very negative experiences with the chain that has caused me to turn from a Blockbuster evangelist, who persuaded my parents and friends to join the Total Access plan, to a disgruntled consumer who won’t step into a Blockbuster until they’ve reformed their customer service attitude.

Keep in mind, I was an easy customer. I auto-paid my monthly bill. I held my movies for weeks and months on end without mailing them back or taking them back to the store for exchanges. I even went for a period of 6.5 months without exchanging my movies (While being charged $17.99 all the while). In the past year I was with Blockbuster, I exchanged only 11 movies in-store. I was as profitable as they could get. But between August and today, I have had three incidences which have convinced me that Blockbuster managers are (1)Incompetent (2)Powerless and (3)Apathetic.

Incident 1: I had exchanged out a set of 3 movies in-store in August. After keeping them out past their initial due date I was billed the price of the movies which is in-line with their policy. As long as they are returned within 30 days, Blockbuster is supposed to refund the charge minus a $1.25 processing fee. However, I got called out-of-town on a business trip, and I left before being able to return the movies. Once I realized the situation, I called my local store and asked if it was necessary to have my wife return the movies while I was gone, or if I could wait a week and return them myself. His answer was that it wouldn’t be a problem for me to return the movies after 30 days, but I would be charged the $1.25 fee per movie. Great, I thought, until I got back home. When I tried to return the movies (32 days past their due date), I was told that it was impossible to return the movies, and that I’d have to pay the ridiculously marked-up used price of $40 for the three (the price at Target for all three new was $21). The manager simply wouldn’t acknowledge that one of their employees had mis-informed me about my ability to return the movies. I tried to call their corporate customer service, who could only refer me to the district manager. To cut this long story short, I spent 3 weeks calling between the store manager and district manager trying to simply refund the movies, which they still sold on their Used racks. I was repeatedly told it was “Impossible” and “the computer won’t allow it”. I know the time I spent trying to return the movies was worth more than $40, but I felt like I was being wronged, and didn’t want to let the issue go. I finally caved when I received a threatening Credit Agency letter. I thought about writing this letter to The Consumerist back then, but I figured it was partially my fault, even though I thought Blockbuster did a terrible Customer Service job.

Incident 2: This one was much shorter. Me, my wife, and her friend walking into a Blockbuster with three return envelopes to exchange. My wife, who had never exchanged movies before, didn’t know to hold onto the envelopes until checkout and sat them on top of the counter as she walked in (thinking that she wasn’t allowed to walk around the store with them). About two minutes later, I realized she wasn’t holding them any longer and walked back to the counter to pick them up. Too late. The clerk had already checked them in without pausing even for a second to see if someone was planning to use them. Again, the clerk and manager claimed that they were powerless slaves to the computer and wouldn’t be unable to let us use the credit towards any new movies since they were already checked-in. Still sore after the treatment I had received a month earlier, I didn’t want to let this go, but they wouldn’t budge. I explained that I was a long-term customer who rarely redeemed my credits, but they stood firm. We ended up paying for two movies and left.

Incident 3: Today. I tightly clutched my return envelopes as I slowly browsed the shelves for three new movies to exchange. Finally, I settle on two movies and a Wii game. Last year, I was able to use a return envelope to pick-up a Wii game without a problem. Well apparently things have now changed. After scanning my three envelopes, they scanned the three items I had brought up. $5.34. “Excuse me, this should be an even exchange.” Apparently not. Now the returned movie only counts as $4 off a $9 game rental. Oh well, I thought, “Just take it off and I’ll grab another movie”. Nope – Apparently each credit gets automatically applied to a specific item and can’t be re-transfered to another item. On top of that, they wouldn’t remove the game from my checkout and insisted that I HAD to pay for the game, even though I hadn’t payed yet and the transaction was unfinished. They insisted that the transaction WAS finished and now I had to pay for it (Which doesn’t make any sense. How can the transaction be over before I am even told what the cost will be). After much debate with the manager, they agreed to take the game off the transaction (as a “Favor”), but they couldn’t do anything about applying the credit to another movie. By this time I had already decided that I would be writing this letter when I got home, and canceling my year-long subscription to Blockbuster Total Access.

It no longer surprises me that Blockbuster is failing as a company. They are closing many stores and hemorrhaging cash. Many analysts don’t even expect them to survive more than a few years. They may not be able to compete with the price and selection of Netflix or the new Apple video rentals, but they had one thing strongly going for them – availability. I knew that if I really needed to, I could go down the street and pick up a physical movie and talk to a real person if I needed to. Now my mindset has changed. Clearly, Blockbuster has decided that their employees and even managers are too incompetent to run their own stores and must be treated like trained monkeys. Even when I found a sympathetic ear, they were simply powerless to over-ride the computer for even simple tasks. Oh well, now that Netflix has unlimited downloads at less than half of the price I was paying at Blockbuster, maybe this is exactly the incentive I needed to make the change.

What do you Netflix customers think? How’s the water in your end of the pool?

Should he switch?

(Photo:medalian1)

Comments

  1. ediebeale says:

    Have never had a problem with Netflix, I get a new movie 48 hours after I mail the old one, they harassed my post office to improve my mail service, and their customer service is FANTASTIC. I do not understand why anyone uses Blockbuster anymore.

  2. snoop-blog says:

    there is a BB 2 blocks from my house and i still prefer netflix. the bb by my house still has insane late fees if you just go in to the store and rent them. so screw them. my netflix is great!

  3. dwhicks01 says:

    I just go to my semi-local video store, pay $10 a month to get half-off making each movie like $1.00 (brand new ones) old ones ($0.25), and it’s on my way too and from work, so no gas is wasted. GO LOCAL!

  4. rewinditback says:

    I was heckled by a Blockbuster employee for being a netflix subscriber (wanted to rent a movie while i was waiting for my next in queue to arrive). Maybe i’m crazy but you don’t heckle somebody to get them to transfer.

    Thats like you walking into a steak joint, ordering fish, and them saying ” What, concerned about your cholesterol PANSY!?”

  5. cabinaero says:

    Blockbuster who?

    We use Netflix for things we know we want to watch; our local independent for obscure things we want to watch; and now iTunes for things we want to watch *right now*

  6. Coder4Life says:

    Heh well it sounds like you kind of got screwed and at the same time it sounds like you are a pain in the ass customer..

    Why in the world would you keep your rented movies for months at at time especially the store rentals.

    Also by keeping the movies for months at a time, you are slowing everyone else from getting the movies. So yeah you are profitable to them but at the saem time you might be costing them money in the back end. Because they have to continue to purchase more movies b/ people like you hold them for such a long time over and over…

  7. snoop-blog says:

    plus i will never do business with any chain if they can’t all be the same product or service. if i go to a mcdonalds anywhere in the u.s., and order a big mac, it will be the same all the time. i got this line of bull from my BB about them not being a corporate owned store and their poicies are different. as a consumer, i should never be able to tell the difference is how i feel, if i can’t get consistant service from a franchise, i will just refuse to do business there.

  8. TWinter says:

    I’ve had Netflix for about three years. I’ve never had any problems beyond a couple of scratched disks and they mailed out replacements for those as soon as I reported them on the website.

  9. Anonymous says:

    Blockbuster made their own failure
    -high late fees
    -sending customers to collections
    -editing their movie for content

    good bye

  10. snoop-blog says:

    my dad calls them ballbusters!! lol.

  11. IrisMR says:

    Something tells me these guys need to change their computers before these things grow a mind of their own and start eating the employees.

  12. MDSasquatch says:

    Hollywood Video works very well for me, haven’t been to a BB in years and quite frankly, I don’t miss them.

  13. pcrnow says:

    Yet another reason I will never go back to BB, there is a BB within walking distance of my house and I am just too happy with Netflix (been a subscriber since 1999) to change.

  14. full.tang.halo says:

    I received a $10 blockbuster gift card from one of my more clueless aunts and to tell you the truth I have no desire to set foot into a BB even with free cash, it’s just that aggravating to go there. How they manage to stay open is beyond me. High prices, new releases never in, bad selection on anything that isn’t new, very little in the way of import films, no thanks. Netflix FTW

  15. beautifulbaby says:

    Netflix has some of the best customer service I’ve ever witnessed. I’ve had a couple discs show up that didn’t work, and at least two disappeared in the mail, and Netflix instantly sent me a replacement the day I reported the problem. The unlimited downloads are amazing (quick and fantastic quality), and they understand the concept of keeping customers happy and loyal. With all of that, I just don’t understand why anyone would bother with Blockbuster.

  16. dgcaste says:

    Didn’t you read that the google-generation is a myth? I can’t extract critical information from a document that long. Besides, Steve Jobs was right on the mark with me. Yawn.

  17. irid3sc3nt says:

    I get my movies from my local library. It’s free and I have the movie for a week. They have an excellent collection and if they don’t happen to have the movie I’m looking for, then I can get it through their interlibrary loan program. If other libraries do not have it, then my library will order it for their collection. It’s awesome (and the library workers are NICE, too)!

  18. darkclawsofchaos says:

    I think Blockbuster is still useful, Netflix is priced nice because of Blockbuster, not to say netflix are evil corporate bastards, but their prices wouldn’t be so generous wihout blockbuster. To be fair I’m not a movie afficionado and don’t use these types of services but to an outsider, this is how it looks like

  19. BugMeNot2 says:

    Never had issues with Netflix. One time a dvd came in the mail snapped in half, just reported it on site and sent it back. No questions, no charge.

    Also, Netflix has been good about aquiring some obscure cult movies when requested.

    As for Blockbuster? I think the last time I was in one of those stores was over 6-7 years ago and even then they sucked+.

  20. NotATool says:

    Really? In 30+ days there’s no time to return the DVDs? Granted, the Blockbuster goons are being kind of jerky, but waiting until the last minute to return something when you’re already in a grace period is just asking for trouble…

    But I’m with the OP on #2 and #3…talk about lame customer service…

  21. matt1978 says:

    @Coder4Life: Learn how to write and spell, goofball. Blockbuster has tons of whatever movies people are looking for, this guy wasn’t holding anyone up. Go work on coding a proper sentence.

  22. ARP says:

    I use on-demand for stuff I want now or “popular” stuff and Netflix for tv shows, indie films, etc. We’ve had a scratched video or two and one got lost in the mail, but its never been a problem. They mail out a new one right away, no questions asked. You’d be surprised how loyal people can be if you just trust them a little bit.

    I think there will always be a “video store” in some form. It may just be a kiosk like at the grocery stores, but there will always be a desire to go to the “store” to figure out what you want to watch.

  23. billbillbillbill says:

    Redbox for me. I go online and pick the movie or movies I want to watch. Next time I’m out, I stop by McDonald’s or Albertsons or all the other locations around me and it only costs me a dollar a day. Some months, we will rent a bunch of movies and pay more; other months just a couple of bucks, no membership fees, no hassle.

  24. mantari says:

    I meant to take a picture of something that was on the wall of my local blockbuster. It says they’re looking for smart people who have a passion for movies. A COLLEGE EDUCATION IS PREFERRED, BUT NOT REQUIRED.

    Holy crap… they want their employees to have college degrees?

  25. Imaginary_Friend says:

    Netlflix and Blockbuster are both pathetic, but Netflix has a better selection, so basically it’s just a choice between suck and suckier.

  26. burgeon says:

    About 13 years ago, I was at The Second City in Chicago, and they were doing a sketch about “sticking it to The Man.” Someone’s character went on a rant about how BB drives out all the cool Mom ‘n’ Pop places with the pr0n in the back through the hinged shutter doors (remember those?). Then they started shouting for everyone to throw their BB cards onto the stage to be destroyed. I had had a few annoying experiences with them, so I actually took mine out of my wallet, and threw it up there with a flick of my wrist. It traveled in a perfect arc and actually landed right at the guy’s feet (among a bunch of fake cards cast members were throwing up there), and he picked it up and said “Yes!! A brave soul named [my name]!! Striking a blow to the corporate overlords!!” Then he cut it up and yelled “And DON’T get it replaced!!” I never did…

  27. mike1731 says:

    I have had wonderful experience with Netflix — new DVD’s arrive 2 – 3 days after I return the old one, unless I’m really getting obscure selections. We still use Blockbuster for some game and last minute rentals since they’re two blocks away from home, but not for everything like we used to. We had a new chain enter our town – Family Video – which seems to have gotten the local Blockbuster more on their toes than they used to be. Oh, the wonders of competition.

  28. harshmellow says:

    I am so tired of employees saying “the computer won’t let me” or something like that. Places that play this game don’t get my business for long. I worked at BB about 15 years ago (on a much more antiquated computer system) and we were able to issue credits, even as lowly non-managers.

    As for Blockbuster the company…I think I see the little blue and yellow ticket swirling down the bowl…and it has almost reached the hole at the bottom. Their days are numbered. Pretty soon, it will be online/mail rentals and small, local video stores only. I don’t use Netflix–we use the library and a small local video store nearby.

  29. The Big O says:

    I don’t have a local option, and think Blockbuster and Hollywood Video are WAY to expensive for what they offer. I’ve had Netflix for almost a year. Gave a 6 month subscription to my pops for Christmas. I really enjoy it. I look forward to paying 3 bucks every now and then when I want to watch a 720p version of a movie through my Apple TV, in case I’m in between Netflix rentals.

  30. smitty1123 says:

    As soon as Netflix starts renting games, I’m done with blockbuster. And yes, I’ve tried Gamefly and hated them. Their two distribution centers on either coast doesn’t do me a damn big of good living in Denver. And $16 a month for 1 game and $23 for 2 games is just flipping ridiculous.

  31. xredgambit says:

    @SnoopBlog: It’s like if I got to a McDonalds and order a sweet tea, then get weird stares. You can always tell a differance between franchise and coperate stores. Odering food and policy is completly different. Now if you wanted to rent Superbad you can walk into any blockbuster and they should have it. Same for McDonalds, they all have BigMacs but not all have sweet tea.
    But as for the guy, I would call the coperate customer service desk again. The 32 days is almost set in stone. But BB is like Spider-man everybody gets one. If you call them up or ask for a number for customer service, more than likely they will give you a one time pass to return them. They call the store and boom it;s cleared. And for the credits, they must be morons, the system is easy to get around (just not for 32 day items, that is a pain to do fix) all it takes is a credit. The reason for a hastle for a void would be is that the profit sharing the store does with the movie companies doesn’t account for credits. But it was no reason for them to fix it for you. But as for the game rental, you don’t know what you are talking about. BB has never given free games for exchanges, they just made the rental $4.99, unless you are thinking about when they offered coupons. The coupons could be used on games.
    Anyway the coperate CS should have taken care of your problem without the DM.

  32. evslin says:

    Signed up for Netflix a couple weeks ago and have been completely satisfied so far. Blockbuster won’t see a dime from me pretty much ever again.

  33. waydownriver says:

    A Blockbuster evangelist? Ewww…

    Doesn’t anybody support local businesses anymore?

  34. youbastid says:

    Good riddance to BlockBuster. Now if we could only say the same for the other BB…

  35. kikidrunkst says:

    Blockbuster is HORRIFYING! The store closest to my house closed during the two week period I had a movie out- with no explanation, no instructions on how to return current rentals. Not wanting to waste a trip, I called customer service to find out how to return the movie, and they referred me to another store. When I got to the second store, they told me they were unable to accept the movie, but could not tell me how to actually go about returning it. Finally, I convinced the store manager to make a phone call to figure out what to do with this movie, but by then I had already resolved never to rent from Blockbuster again.

  36. facted says:

    I’ve been a blockbuster total access subscriber for about a year now and have never had any issues with them. They send me my movies within 2 days (in NYC), and I can return them in the store and take another movie with me to go (as great as Netflix may be, you obviously can’t do that). Yes, they have late-fees for the movies you take out of the store, but that’s not a problem at Neflix…because you can’t get movies from a store ;) I really don’t quite understand what all the complaining is about with blockbuster.

  37. forever_knight says:

    @waydownriver: supporting local businesses is so last century…

  38. chstwnd says:

    This is a timely posting. After announcement of the rates went up, my wife and I decided to get out of BBO quick, but it was over the Christmas break, so I waited until we could exchange the movies we had out at the time. Well, that was the day of the new billing plan, and, even having cancelled the next discovered that we were bound for another month. No pro rated refund. Nothing. So, I was just willing to sit it out.
    On Wed, I returned two movies, and this morning realized that nothing was kicked out of our queue yesterday. I called their (unpublished) customer service number (1-866-692-2789) and hoped to get the queue kick-started (as I’ve had to do in the past). The CSR told me that their online TOS state that mailings will cease 10 days prior to the end of the paid period. Effectively, your last month is shortened by a third! I don’t remember this in the TOS when I signed up a year and a half ago, and this didn’t even apply when they cancelled our account during the summer rate hike (movies were kicked out within 10 days of the forced expiration). Furthermore, the CSR told me that it USED to be 15 days! The conversation ended when he said there was nothing he could do about it except to reactivate my account. My reply was “I sincerely hope you go out of business.”
    With all of the interaction I’ve had with them in the past month, their policies and customer service have only made me violently opposed to ever giving them my business in the future. And I have a laundry list of cautionary statements to make to any of my friends who consider it, to boot.

  39. mdkiff says:

    I have been with Netflix since the beginning, and have never been disappointed. There was a stretch when I seemed to get a lot of scratched discs, but they sent out replacements immediately when you report the problem, and the issue has largely gone away (I don’t know if they have changed their handling of the discs or what). Go Netflix!

  40. Mary says:

    I stopped going to Blockbuster years ago, almost ten years ago actually. They were too expensive, and several people I knew were hit with outrageous late fees and their tactics for collecting were ridiculous.

    In 2001, I signed up for Netflix and I’ve never looked back. I have had no problems, and sure sometimes I get the wrong disc or a scratched disc. But the percentage has been so low to be almost negligible, and they’ve always taken care of the problem quickly.

    I don’t rent new releases from Netflix though, because I don’t feel like taking those out of the pool when I can grab them from the Redbox in my grocery store for a $1.

    I’ve been enjoying their “watch instantly” or whatever it’s called these days. I wish it worked in Firefox, but that’s why I keep IE around.

  41. GirlCat says:

    We got similar runarounds from our local Blockbuster YEARS ago when
    they first started their Netflix-like service. Every single time we
    went in, there would be someone different on the desk with a different
    understanding of the store’s policy. The one thing they all agreed on
    was that the customer is wrong.

    We’ve been using Netflix for a long time and have had no problems.

  42. deadgoon says:

    Full disclosure, I used to work for Blockbuster.

    The reason the video store charges you more for the video than retail is that it COSTS them more that retail. They are not only buying the video, but the rights to rent it out as well. These videos used to cost about $100 a piece, so I figure this submitter got off lucky only being charged $40 per movie. So issue number 1 for this customer is a non-sequitur.

    As far as the other incidents, the in-store managers used to have the power to give you discounts of specific dollar amounts. The manager should have been able to take care of these situations very easily. These are valid issues and should be brought to the attention of higher ups.

  43. DrGirlfriend says:

    I have never, not once, had a problem with Netlfix. I have been a customer off and on for about 4 years. (Off-periods were during times when I was scaling back on my budget, not because of any issues with Netflix).

    Sometime last year I had a situation where I got two damaged DVD’s in a row, but all I had to do was send them back and use their feedback system online to let them know. The very next day, before I had even dropped off the damaged movies in the mailbox, they were already shipping a replacement. and I was never hassled or suspected of trying to pull a fast one on them. I believe that a good way to judge a company is not just how they perform day to day, but how they handle problems. So, at the risk of jinxing myself now, three cheers for Netflix!

  44. You can rent movies free of charge with Redbox as long as you return them before 9pm the next day. Lookup “redbox codes” and they’ll be a whole list of promotional codes you can use to do this. Of course you’re limited mostly by new releases and they will charge you if you don’t return it on time.

  45. qmsterling says:

    I love Netflix! I have been a customer for 3 years now, have never had a problem: videos come quickly, and even the one or two that arrived broken (by some mail machine) were not charged to me. Best part: Netflix has movies you’ve never even heard of, much less seen at Blockbuster, that are some of the best.

  46. chstwnd says:

    I used to be with Netflix 3-4 years ago, and was very pleased with them. When my wife and I were considering a way to watch casual movies (we have no viable cable/satellite options), Blockbuster had just instituted the in-store exchange policy, so we tried them out. At the time, the benefits outweighed the negative impact of being tied to blockbuster. And then they got greedy. We’re back on Netflix now. Netflix’s response to BBO’s idiocy? Well, they just made their on-demand unlimited with no rate increase, and their snail-mail service has always been better than BBO.

  47. shadow735 says:

    I had a bad experience with netflix, one of the movies I sent back to them got lost in the mail. I canceled my subscription about a few months later because I couldnt aford it at the time.
    They billed me two times in the amt of $32 without my permission (probably because I was on auto bill) I called them up and after about 3 phone calls and much stress they “took off” the charge, well they only took off one of the charges.
    So I called again but they claimed only one charge was done I had to fax then a copy of my bank statement but they took thier time and I had to call my credit card company to dispute the charge, the charge was refunded and netflix was notified of this.
    All in all I am very hesitant to join again, besides I buy the new DvD’s I want when they come out and if I dont but want to see a movie I rent it at Albertson’s on Mondays when new realeases are 99 cents.

  48. Kelleah says:

    @waydown river: Several people have mentioned that they use a local video store, so where is this “Doesn’t anybody support local businesses anymore” come from? Either you didn’t read the comments or you’re trying to convince everyone of your superior moral code. Either way, you look like an ass.

    If local video stores are available and meet your needs, great. If not, there’s nothing wrong with taking your money to a company that will. Get off the cross, brother. Somebody else needs the wood.

  49. Daveed says:

    I’ve never had a problem with Netflix, I’ve never heard of them siding against the customer in any situation. Be it lost discs, scratches,or for anything.

    I moved and was missing two dvd’s at one time. I called them up, got a person immediately, they just said they’d mark them as lost and send me replacement discs right away.

    One time I did actually lose a dvd, I did pay for it (I think it was a 25 dollar fee), and when I found it a month later I mailed it back and got a full refund.

  50. PDX909 says:

    I used BB maybe twice about 8 years ago and said never again. Hollywood video were good for a while but since I’ve been using Netflix for 4 or so years I’ve never looked back. Their current customer service model really can’t be beaten, and the selection of old movies, TV seasons and world cinema is the reason I’ll stay with them. So yeah, the water’s great and we get bubbles too.