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U.K. Retailers Up Packaged Media Price Cuts

22 Nov, 2017 By: Erik Gruenwedel

Home entertainment retailers in the United Kingdom are cutting prices earlier on new release DVD and Blu-ray Disc titles, according to new from Ampere Analysis. The London-based research firm said retailers are cutting SRP pricing less than two weeks after street date.

More than 50% of price changes are directly attributable to competitors such as Amazon Instant Video and Rakuten, the Japanese ecommerce and Internet service operating in the U.K.

With increased competition from online platforms, supermarkets selling titles as loss leaders, and ongoing cyclical changes in consumer behavior (i.e. subscription video streaming), price drops occur across almost all retailers at least four weeks after street date, according to Ampere.

Notably, Ampere found Sony Pictures Home Entertainment and Walt Disney Studios Home Entertainment to be the only U.S. studios not cutting prices on one or more of the 60 titles analyzed.

Regardless, the research firm contends accelerated price cuts risk not only negatively impacting studios’ ability to manage their own products' life cycles and the wider perceptions of the category.

“Fluctuations within this window also place those retailers who don’t follow suit at a distinct disadvantage,” read the report.

Ampere said peak price cutting on specific titles occurs from nine weeks after street date – and is more likely to be studio as well as retailer-driven. Price drops peak from 14-to-15 weeks after street date as titles end their 90-day “new release” period and enter a “recent release” promotional period.

The promotional period sees the greatest amount of price cutting across all titles and studios. The final surge in price reductions begins about six months after street date – with all new releases in the mix. Among studios, new releases are effectively re-categorized as catalog titles.

About the Author: Erik Gruenwedel

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