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Low Prices Make Target a Viable Home Media Retailer

20 Apr, 2005 By: Jessica Wolf

I've been a faithful Target shopper for many, many years. I'm one of those customers they love, who walk into the store specifically for toothpaste and shampoo, and wind up with an $87 checkout bill.

However, much as I love the store, love browsing, have always spent a lot of money there, up until I started writing a DVD merchandising column for Home Media Retailing magazine, I never quite thought of the store as an entertainment buying destination.

Even then, it took about a year or so for Target's DVD influence to really hit me as a consumer. The chain has always boasted great first-week pricing and quickly shifted product to create larger and snazzier new-release sections and endcaps for DVD. They were also one of the first retailers of their ilk to significantly shift away from VHS. During my weekly observations, it was clear the cassette began dwindling at Target a lot more quickly than at Wal-Mart or Kmart. It makes sense: DVD is much more in line with the chain's “cheap chic” mentality than bulky VHS ever was. It's been at least a year since I've seen VHS other than kidvid, fitness or the newest theatrical family it stocked in any major quantity at any of the several locations I still frequent.

Yesterday I started, for the first time, to think of Target as a CD buying location as well.

In the weekly circular for my area, Target advertised $5.98 prices on two brand new CD titles I've been wanting by The Kaiser Chiefs and The Bravery.

I made it to a store last night and grabbed the last copy of The Kaiser Chiefs' CD; The Bravery's was already sold out. I'm hitting up another location today in hopes of picking that one up, too; the price is so good, I'm willing to travel a bit for it.

It made me think about the record industry a little as I browsed the CD section of the store. Stocked nearby was a copy of the fabulous Damien Rice's O, priced at $14.99. Now this disc is amazing and awe-inspiring, and worth every penny of $14.99, but I couldn't help doing a little double take. I compared the two discs: same number of songs, same kind of alternative hype for the artists — an almost double price differential. I think the story of the record industry could be so different now if they'd approached CD pricing differently at the same time P2P networks started popping up. If the depletion of stock at Target for these two oh-so-trendy but affordable albums is any indication, people are still interested in buying CDs. If the label has created the opportunity for some aggressive pricing at retail, customers even make a special trip to get it.

Another thing Target often offers is store specials on DVD, dollars-off coupons are stickered to hot new releases for products that keep shoppers browsing the aisles.

Yesterday, I was also pleased to see a few DualDisc titles stocked on endcaps. Stocked near a supply of new DualDisc releases and priced at $2 was a special CD single from Bruce Springsteen containing the song “Devils & Dust.” Stickered on the packaging was a $2 coupon good toward the purchase of the full-length Devils & Dust album, which streets next week as one of the first DualDisc only titles to hit the market. What a great way to give the customer a taste, inspire a future visit and possible purchase, and also help educate on a new product.

In the same circular touting the amazing CD bargain, I noticed Target advertising the new Universal Media Disc, priced at $12.98. Now, I don't know what kind of wholesale cost Target got on that $27.98 SRP product, or what kind of margin it is making with $12.98 store pricing, but that price is right. That price could make the UMD a viable home entertainment software option.

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