Slurpees, Big Gulps, and beef jerky, oh my.

Blockbuster (NYSE:BBI) is making the right call today, installing former 7-Eleven CEO Jim Keyes as its new CEO. I can't emphasize that enough.

Blockbuster is a dinosaur. If it clings to its image as a place to swap physical movies on DVD and videotape, digital delivery and video on demand will continue to guide it on a downward spiral toward obsolescence.

Saving Blockbuster isn't about embracing the new ways we'll all soon consume filmed entertainment; the playing field will be level when that digital future rolls around. The chain's one chance to live -- and keep its creditors at bay -- lies in reinventing its store.

You couldn't ask for a better captain to navigate these rough seas than Keyes. During his five years at the helm of the world's leading convenience-store chain, 7-Eleven always posted positive quarterly comps.

That's huge. With Blockbuster's money-draining Total Access program driving increased foot traffic into its stores for free DVD swaps, the company needs to do a better job of monetizing that flow. Lining the path to the checkout register with overpriced candy, soda, and snacks is a rookie mistake.

Blockbuster needs exclusive merchandise and entertaining diversions to become a destination-driven retailer that actually works.

Subsidizing its Total Access losses can't simply be about taking on Netflix (NASDAQ:NFLX). That's a road to heartbreak. Digital delivery will also find Blockbuster butting heads against companies like Apple (NASDAQ:AAPL), (NASDAQ:AMZN), and Comcast (NASDAQ:CMCSA).

Blockbuster needs to become a retailer again. It needs to become the convenience-store leader in entertainment retailing. In that sense, how can you not like Keyes here -- even if it may ultimately be too late to save the company?

Tomorrow, I'll be back with a few ways to save Blockbuster. Until then, check out some of our interviews with Keyes when he ran 7-Eleven:

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Longtime Fool contributor Rick Munarriz has been a Netflix subscriber -- and shareholder -- since 2002. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.