Videos on Call : Entrepreneur Delivers Tapes Directly to Homeowner’s Lockbox
You promised the kids you would pick up that videotape of “Spaceballs” for the Friday night slumber party, but things heated up at the office and you took lunch at the desk instead of the nearby video store.
Did you disappoint the little darlings? Never. You called P. M. Home Video of Fountain Valley, and the tape was waiting at the door when you arrived home, securely tucked into a blue steel lockbox that industry experts contend is the first of its kind to hit the doorjambs of America. And you didn’t even have to be there to accept delivery.
Steven O’Day, a 26-year-old Orange County entrepreneur, is the man to thank for this, the latest California convenience.
By combining the established concepts of pizza home delivery and the lockbox used by real estate agents, O’Day hopes to find an audience in a market that already offers its viewers a wide range of choices--everything from video stores specializing in classics and cult films to delivery vans that will drop off a large pepperoni pizza along with the movie.
“The customer’s time is worth more than waiting in line,” said Mark Harlan, general manager of P. M. Home Video, which serves videophiles in Fountain Valley and Huntington Beach. “And after all, they still have to choose the movie and put it in the VCR.”
The rental, pickup and delivery of a video from P. M.’s library--which concentrates on the top 40 films, new releases and children’s movies--costs $3.99, compared to the estimated $2.50 cost for renting from most standard video stores.
Market research by the Connecticut-based Fairfield Group shows a substantial consumer demand for pickup and delivery services, said Paul Eisele, president of the research firm, which specializes in home entertainment.
“To the extent that this satisfies that demand and is economically feasible, it could be a good idea,” Eisele said.
But that demand can be deceiving, Eisele said. Delivery is only feasible in densely populated urban areas with a high concentration of VCRs. But those areas also tend to be saturated with video stores, driving rental prices prohibitively low for the video store owner.
One such market is Southern California, where video pioneers started offering home delivery about three years ago--and where several such services have already folded.
“A number of companies have tried it and haven’t been able to succeed. They simply couldn’t generate enough business to offset their costs,” said Emil Reisman, owner of Beverly Hills Videocentre and West Hollywood Videocentre, two walk-in stores that also do delivery. “We’ve been doing delivery for two years, and we’re not getting a lot of business.”
Given today’s dicey market, O’Day could be driving his new company straight to the small-business graveyard, or he could be blazing new trails. It all depends, Reisman said, on the cost of the lockbox and the regularity with which movie viewers are renting.
“It may be an excellent idea,” Reisman said. “I don’t know.”
Like his 450 current customers, O’Day found that he just wasn’t up to picking up his own movies after a long day at work. One year of research and four failed prototypes later, he hit upon just the right device to solve the problem--a two-movie box that is hooked to the top of the door by a small bracket. The back side of the box is open for loading and unloading the tapes. When the box is locked to the bracket, the homeowner’s door becomes the fourth side, preventing theft of the videos.
When the customer arrives home and unlocks his door, he simply slides the entire assemblage off the door, enabling him to remove the videos from the open side.
Customers keep the bracket, while the box is delivered and picked up along with the movies. Viewers can slip their checks--along with the rewound video tape--into the box, or have their credit cards billed directly. After the initial bracket delivery, customers need never see O’Day’s drivers again.
Which comes in handy for the occasionally embarrassed connoisseur of the adult film. While O’Day said he has no clients who confine their viewing to his 25-title blue library, it is not uncommon for a customer to slip “Blazing Bedrooms” in with, say, “Hope and Glory.”
“The embarrassment factor is in there,” O’Day said. “ I wouldn’t feel real comfortable walking into a video store and ordering an adult film from a 16-year-old.”
O’Day hopes to increase his client list to 3,000 by the end of his first fiscal year, in which he expects sales of about $100,000. At that rate, he would be able to recoup his initial $70,000 investment and clear a profit of about $10,000, he said.
As soon as it is fiscally feasible, P. M. will expand its service area to include Irvine and other affluent, nearby areas. If all goes as planned, O’Day said he wants to open several satellite stores for easier delivery. He already has been approached with franchise offers, he said, and his client list grows daily.
“I figure my time is valuable,” said Joel Parker of Huntington Beach, O’Day’s first customer when P. M. began service April 1. “I don’t have to start up the car, drive it a couple of miles, fight the lines to pick a movie up, then return it and remember you have to do it all. I guess it’s the lazy man’s way.”
