This essay is about the market of traditional rental movie stores, which today are on a mature stage of the marketing cycle. The technique is constantly accelerating and contributes to evaluation of new ways to watch movie. New competitors are such as bigger chain of stores that can offer, in addition to their wide range of other goods, rental movies as a secondary selling. The substitute is of most part Internet based services from where you can watch movie online or download film legally as well as illegally.

These different sorts of new competitors or substitutes become a big threat on the traditional rental movie stores as these substitutes can offer the same prices or even lower.

With these new ways of watching film this will on turn change the behaviours of the customers that likes to watch movies. The problem for the traditional rental movie stores is trying to keep their existing customers and try keeping them loyal to their store, so that they won’t loose them to the competitors and substitutes. In this essay we have chosen some strategies of marketing that are relevant for the study, the theories we have used in this essay are: Involvement Theory, Product Life Cycle, and Theory of five competitive forces, Service Profit Chain, Total Communication, and the theory of leverage effect.

These theories are put together into a model showing, from the essay writers opinions, that rental movie stores should create loyalty to their customers compared to its contradiction of transaction marketing management.

The data that has been collected from the owners of the rental movie stores and their customers was collected from our four cases: Filmkedjan Farsta, Top 100, Dancho Film and Fruängens Video. The data was based on four interviews with the owners of the rental movie stores and 100 questionnaires to their customers. These two methods gave us our empirical data that together gave us the basis of analyzing it. The analyzing has been the base to the result and the result has been the base to the conclusion represented in the end of the essay.

One of the main conclusions of this essay is that traditional rental movie stores cannot compete with price, and therefore it is important for them to use loyalty as marketing strategy for a continuing survival on this changeable market.