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Market More Prepared for <I>Rings</I> Repeat

9 May, 2003 By: Holly J. Wagner

It's unlikely that anyone actually yawned last year when New Line Home Entertainment announced it would release The Lord of the Rings: The Fellowship of the Ring in two separate editions. But there was some confusion over what exactly a second edition would offer.

“Most of our readers got it. Initially, when the first announcements were made, there was some concern, but then everybody felt like New Line was upfront about it,” said Bill Hunt, editor of thedigitalbits.com. “The interesting thing to me is that a lot of people just bought the four-disc set, not even realizing there was different stuff on it.”

Retailers ordered low on the extended edition, figuring most fans had already bought the movie and wouldn't pop the extra money for what many people misunderstood as duplicated extras. Then there was the reality of the extended cut and demand for it that caught retailers by surprise.

“The problem last year is that when [Lord of the Rings sequel] The Two Towers opened in theaters, we had a huge demand for the extended edition [of Fellowship],” said Stephen Bissette, proprietor of First Run Video in Brattleboro, Vt. “We were hitting up Wal-Marts 20, 30 miles away for extra copies because we couldn't get any more through distribution, and I know some big retailers were complaining they couldn't get any more through distribution either.”

New Line is taking the same tack with The Two Towers, but this year fans and retailers will be prepared.

“We think people will be a lot more optimistic and will totally understand what the extended version is this year,” said Justine Brody, VP of marketing for New Line. “We expect ordering to be a lot more aggressive. The manufacturing for that type of packaging is a lot more ambitious; we can't restock on a dime. We think people won't want to run out this year.”

So far, that seems to be the case.

“How many hundreds or thousands of units could have been sold that weren't because during that two-week period when that consumer hunger was there to buy it, they couldn't buy it?” Bissette asked.

After last year's Fellowship dual-release schedule, customers know pretty much what to expect from the different versions. How that will play out once the first DVD streets is hard to predict, Bissette said.

“It's going to be a tough call,” he said. “I already hear customers talking about The Two Towers, and I've already had customers say, ‘I'm going to wait and buy [the extended edition].' We may end up doing better on rental of the first version.”

Consumers didn't quite get it with the first film.

“Many people held out for the extended version. I just figured it was going to be a standard one- or two-disc edition and the extended edition would have the same extras. It's kind of saying you have to buy two [sets] to get the complete supplemental material,” said Ron Epstein, moderator of the Home Theater Forum. “I just hate these marketing ploys. As long as they are upfront about it and offer people money off the upgrade, that's fine.”

New Line, in fact, did offer a break on purchases of the second edition to buyers of the first edition.

Consumers must have caught on to the dual-version idea, because New Line's research shows high purchase intent for both versions.

“When we measured it a couple of months ago, 60 percent of consumers said they intended to buy the theatrical version. Normally that intent to purchase is about 36 percent,” Brody said. “The research that we've done does indicate that some people say they are going to defer [wait for the extended version]. But all of those people say they will see Two Towers on DVD or VHS. It's a double-edged sword. Increased penetration of DVD players will offset any deferral.”

Promotions for The Two Towers are expected to be similar to promos on Fellowship, but even better. Instead of coupons in the theatrical cut offering discounts on the extended version, which in turn included movie ticket vouchers for the theatrical sequel, this year New Line will offer the discs with an “Adventure Card” linked to a promotional fan Web site.

“This year we have a lot more flexibility with our promotions because of the Adventure Card. All of our promotions will be offered online,” Brody said. “The card is basically an online coupon booklet. Users get various offers from promotional partners. This is groundbreaking. With the offers being updated monthly, there is a trip to New Zealand every month for six months.”

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