Market Insight

Elektra abandons Blockbuster brand in Mexico

October 16, 2015  | Subscribers Only

Laura Aguilera Laura Aguilera Senior Research Analyst, Service Providers & Platforms

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Instead, the Grupo Salinas subsidiary is to transform Blockbuster stores into The B Store, shifting focus on the sale of technology and electronics items such as tablets, video games, and device accessories to compete with stores such as Best Buy, Radio Shack, Mix Up and CompuDabo.  

The B-Store will continue to offer movie rentals and purchases, but will significantly reduce the space dedicated to video from 70% of store space to only 20%. Grupo Elektra also plans to offer commercial products, and reinforce the company’s current financial services platform, including banking services, within B-Store locations. Indeed, some Blockbuster locations already share retail space with other stores such as pharmacies and cafes.

Our analysis

Elektra paid 408 million pesos ($31.1 million) for the chain in January 2014. As part of the deal Elektra acquired the rights to the Blockbuster brand for two years along with a total of 320 stores throughout Mexico. In 2013, Blockbuster Mexico rented 23 million movies, sold 5.3 million movies or games to 1.6 million customers. 

Since the purchase Elektra has closed 78 Blockbuster stores, leaving a total of 249 retail stores. However, the number of stores is not as important to the retail group as their location. Spread across 108 cities, the stores are predominantly located in middle-class areas – the target market for Salinas’ new financial endeavor, Acertum Bank (a division of Banco Azteca). Branches of the new institution, which centers on digital banking, will be located within or next to B-Stores, targeting higher socioeconomic levels than that those currently addressed by Banco Azteca.  

 

Geography
Mexico North America
Research by Market
Media & Advertising
Category
Digital Media Video
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