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Brits Still Buy Their Movies in Stores

27 May, 2014 By: Erik Gruenwedel

E-commerce retailers such as Amazon slowly growing market share

The majority of Britons still purchase their packaged media — movies, music and video games — in retail stores, despite the fact e-commerce is growing market share incrementally, according to new research.

Through April 13, 68% of British consumers bought a movie disc, music CD or video game at national retailers such as Tesco, HMV, Sainsbury, Morrisons, Game Group and Play, according to Kantar Worldpanel, a consumer research firm. Meanwhile, 32% of consumers frequented online channels — notably Amazon — for packaged media — a 3% improvement from the same period in 2013.

Among the smaller chains, which account for 16% of the entertainment market, Argos is the largest with 1.4% market share.

Amazon grew its packaged-media market share 2.6% to more than 20% compared with a year ago. The e-commerce behemoth now takes two-thirds of all sales on physical entertainment products online and accounts for one in five of all products sold online in the United Kingdom. Among major retailers, all lost market share in physical sellthrough (notably HMV with a 4.3% decline), while Tesco remained flat and Game Group upped its market share 1.7%.

Indeed, supermarket behemoth Tesco remained Britain’s top entertainment retailer in the first quarter (ended March 31), generating more than 25% of Frozen (Walt Disney Studios Home Entertainment) and Warner Home Video’s Gravity U.K. DVD sales, according to Cue Entertainment.

The British Video Association, in its annual yearbook, said 73% of the £2.24 billion ($3.7 billion) consumers spent buying video entertainment in 2013 was on discs. In fact, more British households (22 million) reportedly bought packaged media than subscribed to satellite TV operator BSkyB (10.5 million) or subscription streaming services Netflix and Amazon Prime Instant Video (3.3 million) combined.

“It is testament to video’s massive popular appeal that in a tough economic environment, consumer spend in 2013 remained strong and even grew 0.5% year on year,” Lavinia Carey, director general, BVA, said in a statement.

While supermarkets remain among the top retail outlets for discs, they don’t fare as well selling packaged media over the Internet, accounting for just 4% of online entertainment spending, according to Kantar.

“This disparity is largely because the supermarkets were late to the market, resulting in a lack of awareness among shoppers that the grocers offer music, DVDs and video games on their websites. There is a huge opportunity for supermarkets to develop their online entertainment stores, particularly while their online grocery businesses are growing at 20%,” Kantar’s Fiona Keegan said in a statement.


About the Author: Erik Gruenwedel

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