Price and Promotion

Price and Promotion

University of Phoenix

Marketing 421/Marketing

Directed Studies

December 26, 2005

Week 4 Individual

Since the invention of online rentals, many companies have taken advantage of renting almost anything in today’s society. There are companies that rent motorcycles, cars, pets and other miscellaneous items that may assist in today’s everyday needs. Rentals have become the new creative way to try products prior to purchasing them. This writing will review Gamefly’s price and promotion in the video rental industry. Since Gamefly is the leader in online videogame rentals, this writing will review how they became successful in the retail/rental industry.

The first thing that will be discussed is the promotion of Gamefly. At the start of Gamefly, they promoted through popup ads circulated around the internet. This was a secure way for the organization to get started and have a suitable form of advertising at a low rate. As the company began to gain recognition, it started promoting through e-mail and magazine publications. This was an improvement in the advertising world for Gamefly, because they were now able to reach more contacts and have their product reviewed by consumers all over the world. Now that Gamefly has progressively grown to be one of the leaders of the industry, they are advertising through commercials, publications and web ads that have enhanced the way the Santa Monica firm is doing business. During the 2005 Super Bowl, Gamefly launched an ad that probably produced more product sales than any other rental agency in the industry.

With Gamefly being the leader in the videogame rental industry, they would try to remain on top of the industry by continuously advertising on channels that have the attention of video gamers. One of the major channels that Gamefly utilizes is G4TV. This channel is geared for the videogame industry and has the ability to promote many businesses that involve videogames. Since G4TV is an open-end channel, they also posses the ability to rate and suggest companies that provide the best service to the consumers. In one of the G4TV shows, they discussed video game rentals and Gamefly was at the top of the list for video game rental companies in the United States. This section on videogame rentals was good, because now Gamefly has shown that it can provide excellent service to its customers. With many forms of advertisement and new creative ideas, Gamefly will continue to grow and improve over the next five-years.

The next thing that will be discussed is the price of the rental. Gamefly charges approximately $19.95 a month for the rental of two (2) video games. This indicates that as a consumer, you can keep the games for as long as you like and return the items in a prepaid envelop supplied be Gamefly. This not only saves consumer’s time but it also keeps consumers form paying the price on postage for the rentals. Just a thought, if a consumer rents a game at a local rental agency, the game is due back to that firm on a designated date, and if the game is not returned on time, there are daily charges that would be applied to the account until the unit is returned. However, with Gamefly’s rental program there are no late fees and consumers can keep the units for a longer period of time.

The reason the pricing strategy for Gamefly works is because now individuals can not only rent from home, but never have to go to a physical game store. The internet serves as the store and all the consumers have to due is point and click for their rental. In addition, this is a low price service for consumers and consumers it allows consumers to keep the