TMCNet:  Few local video stores still thrive, but Family Video bucks the trend

[February 25, 2013]

Few local video stores still thrive, but Family Video bucks the trend

Feb 25, 2013 (Belleville News-Democrat - McClatchy-Tribune Information Services via COMTEX) -- Another video rental store is about to disappear in the metro-east.

One of the last Blockbuster stores in the area will close its doors in a few weeks, as the one at 105 Regency Park Drive in O'Fallon will go out of business April 7. The company filed for Chapter 11 bankruptcy in 2011. The once dominant video rental chain had stores in Belleville, Fairview Heights, Collinsville, Glen Carbon and Granite City. Other chains like Movie Gallery and Hollywood Video have also come and gone.


Cheaper alternatives like Netflix, a video rental via mail company, and dollar video rental vending machines such as Red Box have been cutting into Blockbuster's business to the point that Blockbuster also established its own video vending machines.

Furthermore, digital advancements in home computer technology has given consumers access to more movies from their laptops, tablets and cell phones. But some local movie lovers still want the best of both worlds.

Belleville resident Carla Young rents movies from Netflix, but still likes to make trips to Family Video in Belleville to choose from its collection of new and old Blu-ray videos.

"I like to get the movies, especially the Blu-rays, because they seem to be at a reasonable price," Young said.

"It's just the atmosphere here, even if it is to browse, it's the atmosphere to come in and look at movies," said Chris Young, also of Belleville. "It has a lot of the older movies that you can't find online." Julieta Wright, of O'Fallon, said she likes to rent from Red Box, but will also come to the Belleville video store to rent movies.

"I've been a customer for a long time," Wright said. "I always come here to get my movies." Glenview, Ill.-based Family Video has seen its business grown when more in the industry are calling it quits. Jacob Pierce, who is the manager of the store at 1838 Central Plaza Drive in Belleville, said Family Video's survival and success is attributed to customers' demand for face-to-face interaction and selection.

"I would say the most important thing to us is our customers," Pierce said. "That's why we have been successful. That's how we hope to stay successful. Their happiness and their entertainment is our number one priority. If we stick to that business model, we think we can stick around for the long haul." Keith Hoogland's father founded the business in 1977 in Springfield. He said the company became the first home video rental business in the country as the first video cassette recorders entered the market. Since Family Video's inception, the chain has expanded into 19 states and Canada. At last count, Hoogland said the company has 777 stores with plans to add more.

"It's not just surviving, we're doing great," Hoogland said. "Our best year was last year. We're going to set new records this year. Our business is doing better than great, actually." Hoogland said Family Video's business model of offering movies at cheaper prices than competitors, including free movies for children, has been a secret to its success. The company also owns most of its stores, rather than leasing its space.

However, the company is currently down-sizing in a way -- the business is remodeling some of its stores to include Marco's Pizza. The pizzerias are being added as stores that once covered 7,000 square feet are being reduced to 5,000 to 5,500 square feet to make room for Marco's. Hoogland said the shift from the bulky VHS to the thinner DVDs and Blu-ray means that stores do not need as much space, thus providing this opportunity to create in-house pizzerias.

Hoogland also said that computers are not killing his business. He said streaming videos online are still a small part of the business.

"Streaming is less than 2 percent of our business," he said. "Everyone thinks streaming videos is taking off, but it's just not true. It's just not there. We don't have capabilities in our homes yet or enough movies to do it yet or it costs more money to watch video on your computer screen. You have these problems because not enough people have fast enough Internet access. It's coming, but we're not going anywhere for five to seven years. We'll be doing well for that length of time, if not longer." Steve Myers, the manager at the Family Video store in Collinsville, said competition from online streaming has slowed business some, but not enough to hurt it. He said he still has many customers demanding traditional video store service.

"A lot of times you hear the news and different stories about everything on Netflix and online streaming on Hulu, but there is a lot of people who have no idea how to do that and don't have the capabilities for bandwidth to do that on their computer," Myers said. "They still want hard copies, and we're living proof of that. It still works." Said Pierce, "If we stick to that business model, we think we can stick around for the long haul." "We're doing well expanding and creating jobs," Hoogland said. "Not many are able to do that in this economy. It's amazing. Business is pretty good." Contact reporter Will Buss at wbuss@bnd.com or 239-2526.

___ (c)2013 the Belleville News-Democrat (Belleville, Ill.) Visit the Belleville News-Democrat (Belleville, Ill.) at www.bnd.com Distributed by MCT Information Services

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