Tedeschi Bets on Blockbuster

Details: New England chain installing DVD kiosks in every store by year end

Published in CSP Daily News

By  Abbey Lewis, Executive Editor

ROCKLAND, Mass. -- In a total marriage of convenience that readies the chain for the future, Rockland, Mass.-based Tedeschi Food Shops has introduced NCR's Blockbuster Express-branded DVD-rental kiosks into most of its stores. As reported last week in CSP Daily News, the rollout saw placement of more than 100 kiosks in the company's 189 stores. By the end of the year, each Tedeschi Food Shop will be equipped with an NCR machine.

"It makes sense," Joe Hamza, vice president of sales and marketing for Tedeschi Food Shops, told CSP Daily News. "Customers look [image-nocss] for convenience when they come to us. Making entertainment convenient is the ultimate marriage. We're seeing a void in the market where the traditional movie-rental brick-and-mortars are disappearing. We're seeing a demand for this type of product. So if you can do a good job and create a credible destination for DVD rental, I think it's a win-win."

The deal, which is actually a licensing agreement between Tedeschi and NCR Corp., Duluth, Ga., is managed predominantly by NCR. The company owns, operates, services and maintains the kiosks. "We do everything," said Alex Camara, vice president and general manager of NCR Entertainment. "We went to Blockbuster and said, 'Listen, let's bring the two together. Let's put the Blockbuster brand on these kiosks, because we know there is a great kiosk opportunity out there. Let's not let Blockbuster get left behind.' And Blockbuster was very keen on the agreement."

The decision by Tedeschi to go with the NCR program was simple, the retailer said. The company demonstrated thatit had a quality product now and also had plans to update the machinery in the very near future. Hamza said Tedeschi was wowed by NCR's vision for "the evolution of the entertainment kiosk," which will soon include video-game rental.

"NCR has done a great job with the technology," Hamza said. "And the plan for future improvement on the kiosk is good. They're talking about deploying media directly to the kiosk where you can download it directly to a USB port. We know what their vision is and what the plan is for the long run. That's basically what attracted us to NCR."

No membership is required to rent a DVD at a Blockbuster Express kiosk; customers swipe their credit card and are charged $1 per night until they return the DVD. And each Tuesday, every machine is updated to include the most recent DVD releases. More than 900 new and classic DVDs are available per machine.

Since the rollout at the beginning of October, customer response has been "extremely positive," Hamza said. "The comments we get through our managers and the employees in the stores have been very positive. They like the kiosk itself: It's very intuitive; navigation is very simple and easy. The movie releases are really up-to-date. ... If I had to grade it, I'd say A-plus. [NCR] has done a great job and been extremely responsive."

According to NCR's Camara, the rental kiosks are an ideal fit for the convenience industry. "It's a convenience player," he said. "I was in a Tedeschi the other day, and I talked to the customers and asked them why they're here. And they said, 'You know what, it's convenience'."