THE MORNING BUZZ: Wall-toWal-Mart DVDs25 Mar, 2002 By: Thomas K. Arnold
This is a hot week in home video. The Academy Awards were held last night and indications are that the winners are going to enjoy a surge in demand on home video—the ones that are out, of course.
My question is this: are retailers capitalizing on this opportunity? To a lot of the smaller dealers I've spoken with in recent weeks, the Oscars are almost old hat. These retailers collect a few dozen past winners, display them in a corner of the store with a tired "Oscar winners" sign, and then toss in a few copies of this year's crop.
People, people! If I was a retailer, I'd pump the hell out of Oscar, and the funny thing is, the big video sellers — not the specialists — are the ones who are doing exactly that.
Take Wal-Mart, for example. The mass merchant's in-store plans are top secret, as always — Wal-Mart doesn't think much of tipping the hat to the competition in advance, although TV ads for the last couple of weeks have focused on DVD.
But online, it's another story. Last week, the home page for Wal-Mart.com defaulted to a huge banner ad that read, "Choose From Over 10,000 Movies!" DVDs of three nominated films — Moulin Rouge ($18.88), Training Day ($19.95) and the not-yet-released Harry Potter and the Sorcerer's Stone ($19.95) — were prominently featured with "click and buy" buttons.
That Harry Potter and the Sorcerer's Stone is included might come as a surprise to veteran Wal-Mart watchers who associate the chain with impulse buyers, as evidenced by its huge selection of budget-priced cassettes and discs.
But a spokeswoman tells me that at the online unit, where DVDs typically outsell cassettes, advance sales are very much part of the picture — so much that Harry Potter has been the top seller since it was announced in early February, just as it's been at Amazon.com.
The one thing that remains the same at both Wal-Mart incarnations, brick-and-mortar and virtual, is low price. Online, Harry's selling for seven bucks off the suggested list price, and that includes shipping.
Amazon.com is also selling Harry Potter for $19.95—but shipping is $2.98 extra.
But I digress. The fact is Wal-Mart, where video is only a small part of the mix, is making a big to-do about the Oscars, even to the point of preselling a title that's not even out on video yet — not to mention a huge banner ad on the home page of the entire online store.
Many video specialists are doing a lot less — and then they wonder how the mass merchants "steal" their business.
Price may be a factor, but clearly, there's a lot more to it than that.