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August Sellthrough Up 8 Percent From Last Year

30 Sep, 2004 By: Judith McCourt

Consumer sellthrough spending on home entertainment product continued at a steady pace in August.

Consumers spent $864.29 million at the sales counter in August, up 8.2 percent adjusted for the comparable four-week period in 2003.

Consumer spending for the year through August stands at $9.04 billion, with $8.36 billion generated from disc sales.

DVD sales dominated the August landscape, accounting for 93 percent, or $806.66 million, spent buying home video product in the month. By comparison to August 2003, 85 percent of the monthly sales mix was DVD. Sales of DVD were up 15.7 percent from the comparable four-week period in 2003.

The distribution of dollars spent on discs was on a par with July and comparable to year-to-date percentages, suggesting that the migration from VHS to DVD is all but complete and will level off as long as cassettes are still available at retail. A look at the genre data further supports that the migration is reaching an end and that those who are still buying cassettes are doing so out of preference for the format.

An analysis of the sales mix for the top three selling genres: comedy, action/adventure and drama, which collectively accounted for 61 percent of the units sold through the midpoint of 2004, according to Nielsen VideoScan data, shows that about 95 percent of the units are now purchased in the DVD format.

Children's nontheatrical and the fitness genres, which accounted for 7 percent and 1 percent, respectively, of the units sold in the first six months of 2004, are also solidly in the DVD camp. In August, 70 percent of the units purchased in these two genres were discs. Although sales in these genres will continue to move to the DVD column, overall they will not push the needle much past the 95 percent mark. The effect of the last wave of the migration, however, will pummel VHS sales, which have been the mainstay of these genres. Cassette sales in August spiraled downward, dropping to $57.63 million, down 43.6 percent from the $102.09 spent a year ago in the same four-week period. In August 2003, almost half (48 percent) of all children's nontheatrical product was sold as VHS, and 67 percent of the fitness titles were cassette sales.

Buena Vista Home Entertainment was a solid front-runner in the August market share sweeps, with 24.6 percent of the consumer dollars spent buying videos in August.

Buena Vista releases claimed three of the top five seller spots for the month, and five titles landed in the top 10. Kill Bill Vol. 2, released under the Miramax brand, was the top pick for consumers for the month, with the sequel selling 2.81 million units, according to Video Store Magazine Market Research estimates. Hidalgo, released under the Touchstone moniker, was the No. 2 pick, with consumers buying 2.16 million units of the title. The Three Musketeers, a Disney property, sold 825,000 units, landing it in the No. 4 spot for the month.

Warner Home Video, which includes Warner, HBO and New Line, finished second in the August sweeps, with a 19.7 percent market share. Warner's top seller for the month was Taking Lives, which sold an estimated 577,000 units and finished No. 7.

Rounding out the top-five suppliers by market share were 20th Century Fox Home Entertainment (11.1 percent), Columbia TriStar Home Entertainment (10.2 percent) and MGM Home Entertainment (5 percent).

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