NIDEPENIDENT CHOICE FLICKS January 2001 This sample marketing plan has been made available to users of Marketing Plan Prom marketing planning software published by Palo Alto Software. Names, locations and numbers may have been changed and substantial portions of text may have been omitted from the original plan to preserve confidentiality and proprietary information You are welcome to use this plan as a starting point to create your own but you do not have permission to reproduce publish distribute or even copy this plan as it exists here equests for reprints academic use, and other dissemination of this sample plan should be emailedtothemarketingdepartmentofPaloAltoSoftwareatmarketing@paloalto.com.For productinformationvisitourWebsitewww.paloalto.comorcall1-800-229-7526 Copyright Palo Alto Software, Inc. 1995-2002
January 2001 This sample marketing plan has been made available to users of Marketing Plan Pro™, marketing planning software published by Palo Alto Software. Names, locations and numbers may have been changed, and substantial portions of text may have been omitted from the original plan to preserve confidentiality and proprietary information. You are welcome to use this plan as a starting point to create your own, but you do not have permission to reproduce, publish, distribute or even copy this plan as it exists here. Requests for reprints, academic use, and other dissemination of this sample plan should be emailed to the marketing department of Palo Alto Software at marketing@paloalto.com. For product information visit our Website: www.paloalto.com or call: 1-800-229-7526. Copyright Palo Alto Software, Inc., 1995-2002
Confidentiality Agreement The undersigned reader acknowledges that the information provided by in this marketing plan is confidential; therefore reader agrees not to disclose it without the express written permission of It is acknowledged by reader that information to be furnished in this marketing plan is in all respects confidential in nature, other than information which is in the public domain through other means and that any disclosure or use of same by reader, may cause serious harm or damage to Upon request this document is to be immediately returned to Signature or printed Date This is a marketing plan. It does not imply an offering of securities
Confidentiality Agreement The undersigned reader acknowledges that the information provided by _________________________ in this marketing plan is confidential; therefore, reader agrees not to disclose it without the express written permission of _________________________. It is acknowledged by reader that information to be furnished in this marketing plan is in all respects confidential in nature, other than information which is in the public domain through other means and that any disclosure or use of same by reader, may cause serious harm or damage to ________________________. Upon request, this document is to be immediately returned to _________________________. ___________________ Signature ___________________ Name (typed or printed) ___________________ Date This is a marketing plan. It does not imply an offering of securities
Table of contents 1.0 Executive Summary 2.0 Situation Analysis 2.1 Market Summary 2.1.1 Market Demographics 2.1.2 Market Needs 2.1.3 The market and trends 2.1. 4 Market Growth 2. 2 SWOT Analysis 2.2.1 Strengths 2.2.2 Weaknesses 2.3 Competition and buying Patterns 2233455555666 2.4 Services 2.5 Keys to Success 2.6 Critical issues 3.0 Marketing Strategy 3.1 Mission 3.2 Marketing Objectives 3.3 Financial Objectives 3.4 Target Marketing 3.5 Positioning 3.6 Strategy Pyramids 3.7 Marketing mix 3.8 Marketing Research 4.0 Financials, Budgets, and Forecasts 4. 1 Break-even Analysis 8899991 ales forecast 4.3 Expense Forecast 5.0 Controls 5.1 Implementation Milestones 5.2 Marketing Organization 14 5.3 Contingency Planning
Table Of Contents 1.0 Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 2.0 Situation Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 2.1 Market Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 2.1.1 Market Demographics . . . . . . . . . . . . . . . . . . . . . 2 2.1.2 Market Needs . . . . . . . . . . . . . . . . . . . . . . . . . 3 2.1.3 The Market and Trends . . . . . . . . . . . . . . . . . . . . 3 2.1.4 Market Growth . . . . . . . . . . . . . . . . . . . . . . . . 4 2.2 SWOT Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 2.2.1 Strengths . . . . . . . . . . . . . . . . . . . . . . . . . . 5 2.2.2 Weaknesses . . . . . . . . . . . . . . . . . . . . . . . . . 5 2.2.3 Opportunities . . . . . . . . . . . . . . . . . . . . . . . . . 5 2.2.4 Threats . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 2.3 Competition and Buying Patterns . . . . . . . . . . . . . . . . . . . . . 6 2.4 Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 2.5 Keys to Success . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 2.6 Critical Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 3.0 Marketing Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 3.1 Mission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 3.2 Marketing Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . 7 3.3 Financial Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 3.4 Target Marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 3.5 Positioning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 3.6 Strategy Pyramids . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 3.7 Marketing Mix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 3.8 Marketing Research . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 4.0 Financials, Budgets, and Forecasts . . . . . . . . . . . . . . . . . . . . . . . 9 4.1 Break-even Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 4.2 Sales Forecast . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 4.3 Expense Forecast . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 5.0 Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 5.1 Implementation Milestones . . . . . . . . . . . . . . . . . . . . . . . 13 5.2 Marketing Organization . . . . . . . . . . . . . . . . . . . . . . . . . 14 5.3 Contingency Planning . . . . . . . . . . . . . . . . . . . . . . . . . 14
Independant choice Flicks 1.0 Executive Summary Independent Choice Flicks(ICF)is an alternative video rental store located in Ann Arbor, MI. ICF will rent movies not often available from the larger chains: film festival movies, independent releases, foreign films and other arts" films Ann arbor clearly has the market for these types of films, as evidenced by the general demographics(liberal, educated, college town) and the popularity of the monarch Arts Cinema, a first run movie theatre concentrating on this same genre of movies This market has been ignored by the dominant stores in Ann Arbor. They may have a few films that fit these descriptions but in general they are far and few between It is too difficult for the large corporations to market to this specific segment particularly with their current business model which is putting a store in all cities that are very similar in feel and library with a concentration on large scale commercial releases Through the use of ICF's competitive advantage attention to customers it will grow steadily to profitability. This will be manifested in two ways, 1) providing outstanding customer service and knowledgeable help, and 2)supplying movies that have a demand in Ann arbor but have been previously ignored. the demand has yet to be addressed by the other players who leave it off their radar, assuming it is only for the fringe of the general population Fortunately, the fringe in Ann Arbor make up a large part of the general population here ICF will begin profita bility by month nine and will have projected profits of almost $32, 000 by year thre 2.0 Situation Analysis ICF has just begun their first year of operation. a comprehensive marketing plan will be instrumental in developing visibility to ensure future profitability. ICF offers a unique selection of artsy,non-commercial movie rentals. this selection differs considerably from the normal stock that Blockbuster would carry
1.0 Executive Summary Independent Choice Flicks (ICF) is an alternative video rental store located in Ann Arbor, MI. ICF will rent movies not often available from the larger chains: film festival movies, independent releases, foreign films and other "arts" films. Ann Arbor clearly has the market for these types of films, as evidenced by the general demographics (liberal, educated, college town) and the popularity of the Monarch Arts Cinema, a first run movie theatre concentrating on this same genre of movies. This market has been ignored by the dominant stores in Ann Arbor. They may have a few films that fit these descriptions, but in general they are far and few between. It is too difficult for the large corporations to market to this specific segment, particularly with their current business model which is putting a store in all cities that are very similar in feel and library, with a concentration on large scale commercial releases. Through the use of ICF's competitive advantage, attention to customers, it will grow steadily to profitability. This will be manifested in two ways, 1) providing outstanding customer service and knowledgeable help, and 2) supplying movies that have a demand in Ann Arbor but have been previously ignored. The demand has yet to be addressed by the other players who leave it off their radar, assuming it is only for the fringe of the general population. Fortunately, the fringe in Ann Arbor make up a large part of the general population here. ICF will begin profitability by month nine and will have projected profits of almost $32,000 by year three. 2.0 Situation Analysis ICF has just begun their first year of operation. A comprehensive marketing plan will be instrumental in developing visibility to ensure future profitability. ICF offers a unique selection of "artsy," non-commercial movie rentals. This selection differs considerably from the normal stock that Blockbuster would carry. Independant Choice Flicks Page 1
Independant choice Flicks 2.1 Market Summary ICF has collected good information about their market and knows a great deal of information about their archetype customer ICF will leverage this information to determine how to better communicate with and serve their customers Target Markets Under 30 Table 2.1: Target Market Forecast Target Market Forecast Potential Customers Under 30 幅娜游 12.00% 9.00% 10.70% 2.1.1 Market demographics The profile for the iCF customer consists of the following geographic, demographic, and behavior factors Geographics The immediate geographic target is the city of Ann Arbor with a population of 123,000 A 15 mile radius is in need of icfs services The total targeted population is estimated at 64, 500 Demographics Male and female Ages 18-55. This age range draws off a combination of university students and locals within the communit Have (or are getting) a college education and some with graduate degre An income over $40, 000(except the students who earn far less but have a decent amount
2.1 Market Summary ICF has collected good information about their market and knows a great deal of information about their archetype customer. ICF will leverage this information to determine how to better communicate with and serve their customers. Under 30 Over 30 Target Markets Table 2.1: Target Market Forecast Target Market Forecast Potential Customers Growth 2001 2002 2003 2004 2005 CAGR Under 30 12% 36,000 40,320 45,158 50,577 56,646 12.00% Over 30 9% 28,500 31,065 33,861 36,908 40,230 9.00% Total 10.70% 64,500 71,385 79,019 87,485 96,876 10.70% 2.1.1 Market Demographics The profile for the ICF customer consists of the following geographic, demographic, and behavior factors: Geographics • The immediate geographic target is the city of Ann Arbor with a population of 123,000. • A 15 mile radius is in need of ICF's services. • The total targeted population is estimated at 64,500. Demographics • Male and female. • Ages 18-55. This age range draws off a combination of university students and locals within the community. • Have (or are getting) a college education and some with graduate degrees. • An income over $40,000 (except the students who earn far less but have a decent amount Independant Choice Flicks Page 2
Independant choice Flicks of disposable income Non-conventional individuals Behavior Factors Enjoy alternative or less commercial, movie options Prefer to be stimulated intellectually when viewing their films. Participate in cultural activities 2.1.2 Market Needs ICF is providing the customer with a wide range of high quality film rental options. ICF seeks to fulfill the following benefits that are important to their customers Selection: A wide range of rental options that are unavailable at the larger, dominant rental chains Accessibility: All rentals are available from ICF's centrally located storefront. Additionally ICF is open a wide range of hours to accommodate customers various schedules. Customer service: The patron will be impressed with the level of attention that they receive Competitive pricing: All rentals will be priced competitively relative to the competition 2.1.3 The Market and trends ICF is a specialty movie rental store that competes in the broader movie rental business. the industry can be characterized as the"big two,"Hollywood Video and blockbuster. to be sure, there are some independent video rental stores, generally in small neighborhoods and towns, but in general, the big gorillas control everything and target the middle, the mainstream The movie rental business can be further characterized by selection and rental turnover. If a store offers a good selection and has a large number of rental turnovers then it is likely going to be successful. This is the gorilla's strategy. They support this strategy even more by selling some of their rentals as they become less popular to be able to reinvest the money into the newest releases. This last strategy only works with the mainstream market and not ICF's market because the mainstream market is attracted to what is new, the current releases. Once something has been out for a while, interest wanes With ICF customers the age of the video is irrelevant it is the thematic quality, irrespective of popularity and newness that dictates acceptance. There are two major chains, Blockbuster and Hollywood video that are expanding throughout America, often at the expense of the "mom and pop"outfits who are unable to compete against he giants. typically the giants will enter a town and over time drive the local, independently owned shops out of business because of their large selection and commercialization that people favor. blockbuster and Hollywood video however only address one segment (albeit the major one of the population the segment that prefers commercial releases
of disposable income). • Non-conventional individuals. Behavior Factors • Enjoy alternative, or less commercial, movie options. • Prefer to be stimulated intellectually when viewing their films. • Participate in cultural activities. 2.1.2 Market Needs ICF is providing the customer with a wide range of high quality film rental options. ICF seeks to fulfill the following benefits that are important to their customers: • Selection: A wide range of rental options that are unavailable at the larger, dominant rental chains. • Accessibility: All rentals are available from ICF's centrally located storefront. Additionally, ICF is open a wide range of hours to accommodate customer's various schedules. • Customer service: The patron will be impressed with the level of attention that they receive. • Competitive pricing: All rentals will be priced competitively relative to the competition. 2.1.3 The Market and Trends ICF is a specialty movie rental store that competes in the broader movie rental business. The industry can be characterized as the "big two," Hollywood Video and Blockbuster. To be sure, there are some independent video rental stores, generally in small neighborhoods and towns, but in general, the big gorillas control everything and target the middle, the mainstream. The movie rental business can be further characterized by selection and rental turnover. If a store offers a good selection and has a large number of rental turnovers, then it is likely going to be successful. This is the gorilla's strategy. They support this strategy even more by selling some of their rentals as they become less popular to be able to reinvest the money into the newest releases. This last strategy only works with the mainstream market and not ICF's market because the mainstream market is attracted to what is new, the current releases. Once something has been out for a while, interest wanes. With ICF customers, the age of the video is irrelevant, it is the thematic quality, irrespective of popularity and newness that dictates acceptance. There are two major chains, Blockbuster and Hollywood Video that are expanding throughout America, often at the expense of the "mom and pop" outfits who are unable to compete against the giants. Typically the giants will enter a town and over time drive the local, independentlyowned shops out of business because of their large selection and commercialization that people favor. Blockbuster and Hollywood Video however only address one segment (albeit the major one) of the population, the segment that prefers commercial releases. Independant Choice Flicks Page 3
Independant choice Flicks Market Forecast 100000 80.000 70000 60.000 50.000 Under 30 40.000 Over 30 30,000 10,000 2001 2002 2005 2.1. 4 Market Growth In 2000, the video rental industry had revenues exceeding $7. 3 billion dollars. the industry is forecasted to grow at 9% for the next several years. One major reason for this growth is the increasing costs of seeing movies out in theatres. It can cost upwards of $20-$25 for two people to see a movie in the theatre. These rising costs have driven demand for the video rental indust which offers far more reasonable rates and a wider selection although not as cutting edge Target Market Growth 1200% 8.00% 6.00% 4.00% 2.00%
0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 2001 2002 2003 2004 2005 Under 30 Over 30 Market Forecast 2.1.4 Market Growth In 2000, the video rental industry had revenues exceeding $7.3 billion dollars. The industry is forecasted to grow at 9% for the next several years. One major reason for this growth is the increasing costs of seeing movies out in theatres. It can cost upwards of $20-$25 for two people to see a movie in the theatre. These rising costs have driven demand for the video rental industry, which offers far more reasonable rates and a wider selection, although not as cutting edge. 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% Under 30 Over 30 Target Market Growth Independant Choice Flicks Page 4
Independant choice Flicks 2.2 SWOT Analysis The following SWoT analysis captures the key strengths and weaknesses within the company and describes opportunities and threats that ICF faces 2.2.1 Strengths Strong relationships with distributors. Excellent staff who are well informed and customer attentive a centrally-located store front. An unmatched selection 2.2.2 Weaknesses The struggle to raise brand awareness A limited budget to acquire customers Not having the buying power that the giants have, increasing acquisition costs 2.2.3 Opportunities a growing rift in the market between artsy and commercial films and the corresponding The opportunity to decrease customer acquisition costs over time as more customers are acquired through referrals The ability to leverage the fact that the giants"ignore the majority of the alternative/intellectual population segment. 2.2.4 Threats Competition from the giants if they decide to change their course and address the alternative crowd a significant increase in movie theatre technology that makes the in-the-movie experience more difficult to replicate at home Increased popularity of independent and foreign films ensuring that the giants carry these titles
2.2 SWOT Analysis The following SWOT analysis captures the key strengths and weaknesses within the company, and describes opportunities and threats that ICF faces. 2.2.1 Strengths • Strong relationships with distributors. • Excellent staff who are well informed and customer attentive. • A centrally-located store front. • An unmatched selection. 2.2.2 Weaknesses • The struggle to raise brand awareness. • A limited budget to acquire customers. • Not having the buying power that the giants have, increasing acquisition costs. 2.2.3 Opportunities • A growing rift in the market between artsy and commercial films and the corresponding viewers. • The opportunity to decrease customer acquisition costs over time as more customers are acquired through referrals. • The ability to leverage the fact that the "giants" ignore the majority of the alternative/intellectual population segment. 2.2.4 Threats • Competition from the giants if they decide to change their course and address the alternative crowd. • A significant increase in movie theatre technology that makes the in-the-movie experience more difficult to replicate at home. • Increased popularity of independent and foreign films, ensuring that the giants carry these titles. Independant Choice Flicks Page 5
Independant choice Flicks 2.3 Competition and buying Patterns Currently in Ann Arbor there are two different types of competitors 1. The industry gorillas: This refers to Hollywood video and Blockbuster. For all intent and purposes these two are indistinguishable. Both are large and very corporate in the sense that every store is the same, just like a McDonalds. Both stores compete on location, there is little that differentiates them One guarantees that new releases will always by in stock but you only get them for a two day rental. the other does not guarantee them in stock but you get them for five days. For the gorillas, they concentrate the most energy on the new releases this is what their customers seem to want 2. Local video rentals: These stores are small, locally-owned companies that typically cater to a neighborhood. Generally, they do not specialize in any one thing they usually have a wide range of offerings and the bulk of their customers live within blocks of the store. Ann Arbor has several of these People make video rental decisions based on a few factors, typically selection and convenience. If hey want selection of the latest and most popular movies they go to the gorillas. If they do not rent movies that often and are more interested in convenience then they might visit the local video store 2.4 Services ICF will provide Ann Arbor with an alternative movie rental store, a service that is not yet offered in Ann Arbor. The current offerings of typical rental stores are based on popular, commercial releases. There is a market for alternative releases evidenced by the popularity of the monarch Arts Cinema which shows this exact genre of movies in a first run movie theatre format. In essence, ICF will be the home extension of the monarch 2.5 Keys to Success Creative selection Passionate employees Professionalism Customer centric business model 2.6 Critical issues ICF is still in the speculative stages as a retail establishment. Its critical issues are to continue to take a moderate fiscal approach; expand not for the sake of expansion but because it makes fiscal
2.3 Competition and Buying Patterns Currently in Ann Arbor there are two different types of competitors: 1. The industry gorillas: This refers to Hollywood Video and Blockbuster. For all intent and purposes these two are indistinguishable. Both are large and very corporate in the sense that every store is the same, just like a McDonalds. Both stores compete on location, there is little that differentiates them. One guarantees that new releases will always by in stock, but you only get them for a two day rental. The other does not guarantee them in stock, but you get them for five days. For the gorillas, they concentrate the most energy on the new releases, this is what their customers seem to want. 2. Local video rentals: These stores are small, locally-owned companies that typically cater to a neighborhood. Generally, they do not specialize in any one thing, they usually have a wide range of offerings and the bulk of their customers live within blocks of the store. Ann Arbor has several of these. People make video rental decisions based on a few factors, typically selection and convenience. If they want selection of the latest and most popular movies they go to the gorillas. If they do not rent movies that often and are more interested in convenience then they might visit the local video store. 2.4 Services ICF will provide Ann Arbor with an alternative movie rental store, a service that is not yet offered in Ann Arbor. The current offerings of typical rental stores are based on popular, commercial releases. There is a market for alternative releases, evidenced by the popularity of the Monarch Arts Cinema which shows this exact genre of movies in a first run movie theatre format. In essence, ICF will be the home extension of the Monarch. 2.5 Keys to Success • Creative selection. • Passionate employees. • Professionalism. • Customer centric business model. 2.6 Critical Issues ICF is still in the speculative stages as a retail establishment. Its critical issues are to continue to take a moderate fiscal approach; expand not for the sake of expansion but because it makes fiscal sense to. Independant Choice Flicks Page 6
Independant choice Flicks 3.0 Marketing Strategy ICFs marketing strategy will be based on generating visibility of ICF with its targeted population segment. This will be achieved through a multi-faceted advertising campaign. the campaign will utilize advertisements in a local art/entertainment weekly guide advertisements at the local artsy movie theatre, and promotional activities with a couple of local restaurants that have similar demographics 3.1 Mission Independent Choice Flicks mission is to provide the customer with independent non -commercia movies. We exist to attract and maintain customers. When we adhere to this maxim everything else will fall into place. Our services will exceed the expectations of our customers by allowing them to find films that they never expected to find at any video store 3.2 Marketing Objectives Increase repeat customers by 7% each quarter. Decrease customer acquisition costs by 8% per year. Increase brand equity measured by the number of new customers that are already familiar with icf and their niche before arrival into the store 3. 3 Financial objectiv At least 10% growth rate after the second year of operation A 5% decrease in overhead costs per year for the first three years. Profita bility by 18 months 3.4 Target Marketing ICF's customers can be divided into two general groups that are differentiated by age, over 30 and under 30 Under 30: This market segment has a diverse interest that certainly overlaps with the over 30 crowd. The under 30 movies might have more of a concentration on action, violence, drugs, sex, etc. This is not to say that the movies are about these subjects solely it is just that these topics might relate better to someone under 30 than over 30 Over 30: This market segment has a bit more mature tastes the humor may be more sophisticated, they are more likely to enjoy a foreign film relative to the under 30 group Generally, the topics of the movies will reflect issues that this group is most used to or closer to their experiences ICF is focusing on these two groups because they are underserved in Ann Arbor. Currently, there are two large corporate rental chains Hollywood video and blockbuster that hold the majority of the market. In order for them to be successful, they must concentrate on the middle of the market the mean. This allows them to use economies of scale to drive down the costs of operating a movie rental business. While this works for the general population, it does not address the fringes at all. ICF is addressing the fringe movie rental market. Page 7
3.0 Marketing Strategy ICF's marketing strategy will be based on generating visibility of ICF with its targeted population segment. This will be achieved through a multi-faceted advertising campaign. The campaign will utilize advertisements in a local art/entertainment weekly guide, advertisements at the local artsy movie theatre, and promotional activities with a couple of local restaurants that have similar demographics. 3.1 Mission Independent Choice Flicks' mission is to provide the customer with independent, non-commercial movies. We exist to attract and maintain customers. When we adhere to this maxim, everything else will fall into place. Our services will exceed the expectations of our customers by allowing them to find films that they never expected to find at any video store. 3.2 Marketing Objectives • Increase repeat customers by 7% each quarter. • Decrease customer acquisition costs by 8% per year. • Increase brand equity, measured by the number of new customers that are already familiar with ICF and their niche before arrival into the store. 3.3 Financial Objectives • At least 10% growth rate after the second year of operation. • A 5% decrease in overhead costs per year for the first three years. • Profitability by 18 months. 3.4 Target Marketing ICF's customers can be divided into two general groups that are differentiated by age, over 30 and under 30. • Under 30: This market segment has a diverse interest that certainly overlaps with the over 30 crowd. The under 30 movies might have more of a concentration on action, violence, drugs, sex, etc. This is not to say that the movies are about these subjects solely, it is just that these topics might relate better to someone under 30 than over 30. • Over 30: This market segment has a bit more mature tastes, the humor may be more sophisticated, they are more likely to enjoy a foreign film relative to the under 30 group. Generally, the topics of the movies will reflect issues that this group is most used to or closer to their experiences. ICF is focusing on these two groups because they are underserved in Ann Arbor. Currently, there are two large corporate rental chains, Hollywood Video and Blockbuster that hold the majority of the market. In order for them to be successful, they must concentrate on the middle of the market, the mean. This allows them to use economies of scale to drive down the costs of operating a movie rental business. While this works for the general population, it does not address the fringes at all. ICF is addressing the fringe movie rental market. Independant Choice Flicks Page 7
